Military Members Able to Name Special Needs Trusts as Beneficiaries of Survivor Benefits

The Disability Military Child Protection Act 2015 was signed by President Obama December 19, 2014. Congress is allowing members of the military to name special needs trusts as the beneficiaries of Survivor Benefits Plans (SBP).

What does this mean for military families? For military families with special needs children, this means a parent will be able to direct SBPs to these children without compromising the children’s’ ability to receive means-based public benefits. Previously, children with special needs that were the beneficiary of the SBP were left in a compromising position, as the benefit was a countable resource. Because the SBP was a countable resource, there existed a significant risk of potentially losing access to means based public benefits, such as Supplemental Security Income (SSI) or Medicaid.

Advocates have been working to advance a bill through Congress, known as the Disabled Military Child Protection Act 2015. What changed is that advocates pushed Congress to add the provisions of the Disabled Military Child Protection Act to the National Defense Authorization Act of 2015. Language was added to the appropriations bill with the support of several prominent National Academy of Elder Law Attorneys (NAELA) members.

Although this is a fantastic first step in the right direction, they are still working out how to implement internally. But one thing is clear from the Act, an irrevocable Special Needs Trust must be established first in order to assign the benefit in the trust.