On December 15, 2014, Congress passed the Disabled Military Child Protection Act. This legislation grants military members the authority to name a “payback” special needs trust as a beneficiary of Survivor Benefit Plans (SBP).
Up until now, individuals who received SBP have often been locked out of Supplemental Security Income and Medicaid funded support programs. This Act permits monthly benefit stipends up to 55% of the military member’s pension to be paid for the benefit of a disabled child.
If there are any assets left in the trust when the recipient of SBP dies, the funds are paid back to Medicaid for the cost of the recipient’s care. These individuals will now be able to remain eligible for Medicaid which is the primary payer of residential placements such as group homes and other residential options for persons challenged with disabilities who need residential supervision and or assistance from a Medicaid Waiver program.