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Research
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Best
Practices in Pooled Trust Programs *
Rick Berkobien,
MSW
Statement
of Problem and Background
Conceptual/Theoretical Model
Research Questions or Hypotheses
Methodology
Progress to Date
Key Findings and Potential Implications
Statement of Problem and Background
Pooled trusts,
usually operated by non-profit organizations, are used by families and others
to provide financial care for the person with MR or other disability. In lieu
of establishing an individual trust account for a son or daughter, families
"pool" resources with other families in one trust. The organization
then manages and invests the trust as a single fund which reduces administrative
fees as there is only one account, and increases the total amount of principal
for investments. Beneficiaries then receive earnings based on their share of
the principal. Some organizations also operate a type of trust which an eligible
individual with a disability can fund with his or her personal money. Pooled
trusts allow families with smaller amounts of money to use trusts (in lieu of
bank trusts that usually require larger accounts) and are usually managed by
an organization that is operated by or affiliated with a disability group.
Pooled trusts
are especially beneficial to people with MR receiving services through Supplemental
Security Income (SSI) and Medicaid. SSI and Medicaid are usually means-tested,
meaning the person's assets cannot exceed a certain amount, and the person must
usually contribute toward his or her cost of care with the proceeds from any
earnings, SSI or Social Security Disability Insurance checks. Many of these
individuals are then left with only a small personal care allowance (as low
as $30 per month in many states) for clothing, toiletries and related items,
that parents often subsidize because the amount is grossly insufficient. If
the parents then die and leave their son or daughter an inheritance to help
cover these costs, the inheritance will likely be considered an asset, and the
heir will be charged a full "cost-of-care" charge, which would quickly
deplete this inheritance meant as supplemental funding. Pooled trusts usually
do not impact the individual's SSI and Medicaid in this manner as the trust
restricts distributions to certain limits or usage. This helps to ensure that
an inheritance to provide supplemental income will not be lost (Berkobien,Varnet,
& Davis, 2002).
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The project
used a community-based model of aging in-place for families of persons with
intellectual and developmental disabilities.
Research Questions or Hypotheses
The aims of
this project are to increase understanding of quality practices in pooled trust
programs; to aid families in using trust programs or alternatives; and, to increase
the family's ability to develop effective future plans that address financial,
legal and service/support areas.
The study
has two research questions.
1) What information do families and individuals need to make an informed choice
about using pooled trust programs?
2) How are pooled trust programs organized and what services do they offer?
What are the experiences and levels of satisfaction of families who have used
pooled trust programs?
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The Arc conducted
three studies to answer the research questions.
Study 1. A
forum of trust program representatives, parents who have developed a financial
plans and legal/financial planning experts was convened to begin the process
of identifying best practices for pooled trusts. Through a consensus process,
participants identified information, practices and strategies to increase the
family's knowledge and skills in using trust program services (or alternatives)
and program quality (e.g., advantages/disadvantages of a pooled trust; strategies
to determine adequate trust amount; questions and methods families can use to
identify program quality). Forum outcomes were summarized in a draft document
later used to produce a publication for families and advocates, Pooled Trusts
Programs for People with Disabilities: A Guide for Families.
Study 2. Trust
programs were surveyed by mail to elicit the following: structure of program
(separately incorporated, administered by another organization); governance;
quality assurance mechanisms (internal, external evaluations); populations served
(people with MR only, cross-disability); geographic locale served; service monitoring;
state-specific regulations that impact program; type(s) of trusts provided;
investment minimums, fee structure; disposition of trust remainder upon beneficiaries'
death; and, steps undertaken in developing their program. This information was
used for background in producing the pooled trust document.
Study 3. The
Arc conducted a survey of families who have used pooled trust programs or conducted
other financial planning to determine their experiences and satisfaction with
these programs or other planning methods used. Questions included: type of financial
plan used (pooled trust, individual bank trust); reason(s) for choosing plan;
obstacles to planning (lack of information, lack of resources) resources; satisfaction
level with program/plan; methods or strategies used or helpful in making decisions
(training, materials, professional's assistance); family members participating
in decision-making (including relative with disability); and demographic information.
The survey was disseminated through The Arc's newspaper to its members.
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All studies
are now complete. The document developed from study 1, Pooled Trusts Programs
for People with Disabilities: A Guide for Families, is published in hard copy
and on The Arc's web site. It is also being disseminated by the RRTC's Clearinghouse.
The information from study 2 provided valuable additional information used in
developing the pooled trust guide. The PI also decided to do a search for additional
pooled trust programs and identified 9 new ones and 2 that ceased to exist.
The Internet was searched and all identified programs were contacted to assist
in the search and to verify their existence. Thirty-five are listed in the pooled
trust guide.
Study 1. To
gather information on best practices of pooled trust programs, forums were held
at The Arc's conventions in 1998 and 1999. The invited participants were those
who operated pooled trusts and attorneys who were experts in financial planning.
Many were also parents of a son or daughter with a disability. The forum participants
were led through a process of examining pooled trust programs and identifying
key features representing quality in the operation. The forum outcomes were
documented in a draft of Pooled Trusts Programs for People with Disabilities:
A Guide for Families. The draft document was sent for review to forum participants
and to all other of the 28 known pooled trust programs in the U.S., both those
affiliated and not affiliated with The Arc. Contact information for these programs
came from a list that The Arc maintains. About half of the reviewers were participants
in the forum. The comments and recommendations from these reviewers were used
to prepare a revised document. The document received a final review from two
attorneys, two pooled trust directors, two RRTC staff and two parent advocate
advisors to the project. Data analysis from this study addressed research question
#1: What information do families and individuals need to make an informed choice
about using pooled trust programs?
Study 2. The
trust program survey was developed in collaboration with the National Guardianship
Association and pilot-tested by three forum participants. It was sent as a mail
survey to the 28 known pooled trust programs. This study was designed to address
research question #2: How are pooled trust programs organized and what services
do they offer? Data was collected from 10 programs. It was determined that the
best use was as additional information for developing the pooled trust guide
for families.
Study 3. The
family survey was mailed to The Arc's total membership in the quarterly newspaper.
Families who are using a trust program or who have undertaken other financial
planning were solicited to respond to a questionnaire. The family survey was
designed and field-tested to minimize response burden in terms of length of
time to complete and readability/comprehension of questions. Closed-ended questions
were used with multiple responses. Data from the family survey was analyzed
to examine the types of financial planning families have used, amounts of financial
investments, level of satisfaction with various services, unmet needs and related
areas, and examined to determine if respondent's role (parent, professionals),
age, ethnicity, geographic locale, access to programs, training or other assistance,
and similar variables are significant factors in decisions about types of planning,
amount of financial investment and level of satisfaction. Data analysis of this
study responded to research question #3: What are the experiences and levels
of satisfaction of families who have used pooled trust programs? The results
were published in The Arc's newspaper.
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Key
Findings and Potential Implications
Families'
needs for information on guardianship and alternatives, trusts and planning
for services and supports are well documented (Heller & Factor; 1991, Heller
& Factor, 1993). However,
early studies indicate that few families conduct financial planning for a family
member with a disability. Heller & Factor (1991) found that only 31% of
families in their study contacted an attorney to initiate planning. The survey
(study 3) conducted by this project heard primarily from families who were engaged
in future planning. Seventy-four percent of the 223 respondents had a financial
plan in place for their family member with a disability. Only 5 % of these respondents
used a pooled trust.
Many of the
26 % who had not develop a financial plan assumed that such planning for the
relative with a disability is just for people who are wealthy. This supports
the importance of educating families about options other than a trust established
with a financial institution. The use of a pooled trust is one option. However
it is not universally available, as only 22 states are known to have pooled
trusts operating, and not all of these are available to families statewide.
This research has the potential to improve trust services and help build the
capacity of families to "take control" of financial future planning,
a complex area that may intimidate families.
Findings from
these studies and others of the RRTC will be used to produce a new publication
for families to guide them in future planning. It will combine and be an update
of two publications of The Arc popular with families (A Family Handbook on Future
Planning, How to Provide for Their Future now out of print). It will incorporate
RRTC research from the consumer initiated planning (Heller) and family initiated
housing projects (Factor). While not replacing the need for an attorney or other
professional, the publication will guide families to increased decision-making
and control of financial, legal and services/supports planning.
* Previously on the grant, no longer on this project