Consider Using a Pooled Trust with MassHealth Nursing Home Planning

If a single person wants MassHealth assistance with paying for nursing home care, but has more than the $2,000 in assets that MassHealth will permit her to keep, one option is to transfer the excess assets to a pooled trust.

A pooled trust is a trust managed by a non-profit for the benefit of disabled individuals.  MassHealth regulations permit a single person to transfer assets to a pooled trust and still qualify for MassHealth.  Transferring excess assets to the pooled trust would allow you to qualify for MassHealth while having funds held in the trust that you can dip into to supplement your care.  For example, MassHealth won’t pay for those new dentures you need, or for a chair car to take you to your grandchild’s graduation.  After you pass away, the pooled trust keeps about 25% of the balance (to support its mission of assisting disabled adults), and MassHealth is paid back for whatever it has paid the nursing home on your behalf.

Because of the payouts at the end to the pooled trust and to MassHealth, you can see that this is not a vehicle for preserving all of your assets for your family – but it is still a good planning option.  First, MassHealth pays a lower rate to the nursing home than private payers, so in the end, you are paying the nursing home, but less than if you were to pay privately.  Second, by transferring the funds to the pooled trust, rather than spending all your assets down to $2,000, you establish a “savings account” into which you can reach for extra expenses that MassHealth does not cover, such as companion care, or a home health aide for visits home.  After the pooled trust and MassHealth are paid, your family will receive any balance.

For examples of pooled trusts in our area, check out:

PLAN of Massachusetts and Rhode Island

CJP Disabilities Trust II