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By Rob Wrubel, CFP®
Many families with special needs members are worried about the social security system, Medicaid and the ability of these programs to continue at their same levels in the future. Most of us believe and plan for a government benefit to provide some level of service and care for our disabled family member.
Right now, some of the best programs available are only available through the gateway and funding mechanisms of Medicaid, Social Security or state programs that have been created to fill gaps. Many residential facilities and those that support employment are fully government funded and only available to people who qualify for government programs.
Families must expect change. The rules governing programs change. States add and cut programs over time. Right now, the health care system is adapting. Most families with special needs members I speak to look forward to a universal health care system as they worry about cuts to Medicaid. Universal health care promises to keep coverage in place for people with disabilities. (There are other issues good and bad about the plan and we can save those discussions for another day). But even this will likely change.
One concept gaining traction is for families to take a hard look at how they are planning for future needs. They are asking themselves how they might be able to supply a system of care that is more permanent, highly customized and privately funded.
Families are looking to create their own private social security system.
Is this right for you?
Right now, my experience tells me that most families have not taken the basic steps to plan for their special needs family member’s future. They have not put together a financial plan and funding mechanism. They have not reviewed and updated their estate documents. They have not become educated about what assistance is available today.
If you fall into this camp, a privately funded system is not going to be right for you, today. It might make sense down the road once you have taken the first steps to putting a strong plan in place based in today’s landscape.
My suggestion for you then is the following. Sit down with a financial planner and put together family goals and a funding plan. Meet with an estate planning attorney and make some decisions about a special needs trust. Start a working life-plan document to identify other key people who are involved in your special needs family member’s life.
These are the basics.
The next step is to decide if you have the resources, time and ability to put together a plan to provide those resources that are typically paid for by the government.
Your family will need a case manager. While you are around, you provide this service to your family. You make appointments, review therapists and doctors and advocate in schools, hospitals and living facilities.
Today, organizations are sprouting up to provide support for a different population—baby boomers and their parents. These organizations often provide the same supports that a case manager from Social Security or a state agency provide.
You will need transportation. People with disabilities often have transportation facilities that can be accessed—sometimes it is door-to-door. Can you replace that?
You will need employment assistance. Most states have work programs to help people with disabilities participate in the work force. Some programs seek to get a person to full employment, others seek to have employment become part of a life and wellness plan.
You will need to protect assets. Current regulations require people with disabilities to be impoverished to gain access to programs. You will need to take steps to protect assets of the special needs person if you choose to forego the government programs. You may build a trust plan that allows the trustee to opt in and out of government funding.
You will need a team. Build the right team to help your family make important decisions. That team includes key professionals, other family members and important people in your life.
You will need funding. This will certainly be the most important piece of the puzzle. Government funding may represent tens or hundreds of thousands of dollars a year of services that you will have to replace. You will need to review your current asset levels, manage them well and decide how to structure holdings to provide income and growth to fund all the expected future expenses.
Too often, families with special needs members sit and wait for government support. They give up control and independence.
You can build a plan for the future that meets your family’s best intentions. You can make the biggest difference by taking action today. Call me today to get started.
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