Start planning for your dependent early on
Caregivers planning for the financial future of their adult dependent over 22 years old who has special needs often have different issues to consider than caregivers of younger dependents.
For caregivers with younger dependents receiving special education services, the nature of the disability, interventions, ultimate prognosis and outcomes are uncertain. They will try different therapies and educational and treatment modalities and be proactive in positively impacting their dependent’s abilities. But these caregivers are often unaware of the type of long-term care support their dependent will need and whether they will be able to function independently. They are unsure how their hard work, therapy, doctor visits and advocacy efforts will pay off in the long run. Caregivers of younger dependents are hopeful for positive outcomes, adaptations and results.
By the time a dependent turns 22, caregivers have a clear sense of their capabilities, the support they require and what the future holds for them. Caregivers know whether their dependent will go to college or be gainfully employed. They know their dependent’s activities of daily living skill level, interpersonal skills and competencies. They know if their dependent will be self-sufficient, need government benefits, can live alone or will need supplemental assistance and support provided by caregivers or loved ones.
Caregivers of both younger and older dependents need to calculate how much money is needed to supplement education, medical, social, recreational, housing or vocation services. Government benefits must be supplemented through additional planning efforts as well. These issues are directly related to calculating how much money is needed when special education services end at age 22.
When your dependent turns 22 years old
After a dependent’s 22nd birthday, mandated education services are no longer provided. The Individuals with Disabilities Education Improvement Act (IDEIA) of 2004 requires that children with disabilities receive:
- An initial evaluation to determine if the child is a person with a disability,
- A free appropriate public education that emphasizes special education and related services designed to meet their unique needs and prepare them for further education, employment and independent living,
- Education as close to home as possible and in the least restrictive environment with children who do not have disabilities and
- Supplemental services (such as speech therapy, occupational therapy or a classroom aide) to complete their education.
Caregivers of dependents with special needs who turn 22 and transition from their individualized education program (IEP) and special education services into the adult services arena are faced with many new issues and obstacles. A well-designed transition plan by the educational team and student will help with successful transition for further education or employment. The nature, scope and severity of the disability will determine whether additional transition, rehabilitation, day programming, medical or vocational services are needed. Some adults with special needs will continue to receive government benefits such as supplemental security income (SSI) and Medicaid, while others will not.
Many private health insurance policies do not cover students or adult dependents with special needs past the age of 22. Caregivers need to carefully review their health policies and contact their benefits department to determine extended coverage for their dependents. Coverage varies from plan to plan. Some policies provide extended coverage, while others do not.
Get the facts about the costs for medical care
The cost of medical care is staggering for those who do not receive government health insurance benefits. Many states provide supplemental health care coverage for people with special needs over age 22, which may not be tied to SSI eligibility. These supplemental policies may require an extra premium or larger coinsurance percentage or deductible. However, many states do not provide supplemental health care policies for adults with disabilities. Caregivers need to check with the social service agency that administers Medicaid in their county or state to determine the level of coverage and services provided in their area since they vary from state to state. In addition, many states offer choices between Medicaid providers. Coverage between those plans vary as well.
Caregivers of adults with special needs often experience sticker shock from large medical bills if their dependent is not receiving government health insurance benefits or if they are not covered under a caregiver’s individual or group health policy. These caregivers should seek knowledgeable professionals and advocates to help secure needed health care benefits and services for their dependent. Advocacy organizations in most states advise caregivers on health insurance-related issues.
Find a special needs planner you trust
Special needs planning, when coordinated with a properly funded special needs trust, helps caregivers plan for the financial future of their dependent with special needs. If structured by knowledgeable special needs professionals, assets can pass to a special needs trust and not count toward the $2,000 SSI limit for an individual — which means that government benefit eligibility will be maintained and money can be used to supplement the lifestyle of the person for whom the trust was established. The trustee needs to make certain that the money is used for supplemental purposes only.
An important part of special needs planning is to make certain that a mechanism is set up to provide enough money to meet long-term needs. Caregivers with dependents under 22 whose multiple needs are being met through local school systems might find themselves with additional bills after their dependent graduates from the education system. Caregivers may find they now have to pay out of pocket for additional speech therapy, occupational therapy, counseling, physical therapy or other services previously provided under the terms of the IEP. When planning for a person under 22 with special needs, caregivers cannot forget to incorporate important benefits and services provided by the local school system. Replacement services and costs need to be carefully planned. They will become the responsibility of the caregiver or their dependent after their 22nd birthday.
Due to the complexity of federal and state laws, you may require a specially trained professional who can work with your other advisors to help you plan for the future of your dependent with special needs.
For more information about this and other related topics, visit the MetLife website at www.metlife.com/specialneeds or call 1-877-638-3375.