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Milestone Ages in Special Needs Planning:
4 Must-Do’s When Your Child Nears 18
Introduction
Parents of school-age children with disabilities spend the school years navigating services their minor child needs. Overwhelmingly, most parents are uninformed about the full range of “transition planning” they need to arrange for their child even while still in school, at what ages, why, and the consequences of not taking that action.
Transition planning is broader than the school graduation and vocational placement parents are familiar with through the school system, which services often end in Delaware at age 21 or high school graduation at age 22.
Parents are stunned to learn they should start taking action while the child is still 17.
Transition planning extends beyond educational services to 4 main areas, which, when it comes to public benefits programs, have their own milestone dates and vary by program and state. Nearing 18 is the time to approach all of them:
- Health and Financial Decision-Making
- Age-18 Determination of Disability for SSI (Which is Gateway to Social Security Disabled Adult Child Benefits and SSI Medicaid)
- Medicaid Transition (Child to Adult Eligibility)
- Estate Plan for Parents Providing for Child With Disability
I. Health and Financial Decision-Making
When a person reaches 18, no one has legal authority to make health or financial decisions for that person, unless that person: 1) has legal capacity to, and does, prepare Powers of Attorney (and related documents such as a HIPAA Authorization, designation of Social Security Representative Payee, and in some instances a Supported Decision Making Agreement) authorizing someone else to make those decisions, or 2) if the person lacks legal capacity to prepare Powers of Attorney, legal guardianship is obtained through the Delaware Court of Chancery.
The determination of capacity is a legal one. Competent counsel will meet with the person preparing the Powers of Attorney (who is the client) several times, including as appropriate and for proper duration, alone, to assess legal capacity and provide counseling, including on the powers authorized and choice of agent. Counsel has an ethical duty to communicate effectively with the client. It is essential to select an attorney with expertise and experience in the highly specialized area of special needs planning. Too often we see Powers of Attorney prepared by counsel lacking this expertise, where vital powers that client needs are not included, impeding instead of helping that client.
Guardianship is a remedy of last resort. Parents should contact competent legal counsel starting 3-4 months before the child turns 18. If guardianship is required, we file the petition with the Court before the 18th birthday, to be evaluated by the Court in advance and a guardianship order signed if not on the 18th birthdate then within days of it depending on the Court’s schedule. Petitioning for guardianship is not simple and takes time. Parents must provide data and statements about their child. This takes time for parents to find and submit to us. The Court process itself takes time. In every guardianship proceeding, the Court appoints an Attorney Ad Litem to visit the person with an alleged disability, the parents, and proposed guardian(s), for the purpose of being the “eyes and ears” of the Court to report to the Court.
II. Age-18 Determination of Disability for SSI (Which is Gateway to Social Security Disabled Adult Child Benefits and SSI Medicaid)
Supplemental Security Income (“SSI”) is a monthly cash benefit for persons who: 1) apply for and receive a Social Security Administration determination of disability, and 2) meet financial requirements (income and resources). Before a child reaches 18, income and resources of parents are “deemed” to that child. Because of that parental deeming, many parents of children under 18 never apply for SSI for the child. But since at age 18 parental deeming ends, 18 is a milestone age parents cannot ignore.
The vital importance of applying for SSI – to obtain the Social Security determination of disability - at 18 cannot be overstated. The two most immediate and important reasons a parent must know are:
A. Disabled Adult Child Benefit: 50% of Parent’s Monthly Social Security When Parent Retires and 75% of Parent’s Monthly Social Security When Parent Dies.
Under federal law, key requirements for the Disabled Adult Child benefit (called Child Disability Benefits) are a child determined by the Social Security Administration to have a disability that began before the age of 22 and who does not marry. Because the disability onset date must be before the age of 22, it is much easier to prove this disability before actually reaching 22. Waiting past 22 is a common and often fatal mistake, because evidence is more difficult to obtain over time as medical offices, schools, therapists, and other relevant professionals hold records for limited periods of time and staff changes. Proving disability to the Social Security Administration is difficult. Many lose on the first application and must appeal. The determination of disability requires a finding by the Social Security Administration that a person is unable to engage in “substantial gainful activity” which means, in general terms, the non-blind person cannot work for more than one year at a rate of $1,690 per month. Accommodations to allow that person to work are given a value and counted in the determination. Employers and other providers such as therapists who provide that accommodation must submit documentation and may be called to testify. It is essential to obtain that determination while good proof is available. Too often, and so sadly, we see families whose adult children have missed that window of proof, and it is too late for them to apply for this vital benefit.
The Disabled Adult Child benefit pays to the child, for the child’s life, 50% of the parent’s monthly retirement benefit when the parent retires (and the parent’s benefit is not diminished) and 75% of the parent’s monthly retirement benefit when the parent dies. The DAC benefit therefore can be a lifelong cash safety net for the child. Further, with the DAC benefit after 2 years comes automatic Medicare.
B. Gateway to SSI Medicaid (and Preserving the “SSI First” Advantage of Keeping SSI Medicaid After Converting to Social Security Disability)
Gateway to SSI Medicaid
While the monthly cash benefit of $994 in 2026 may be small, the value of SSI is its gateway to SSI Medicaid. In Delaware, with SSI comes automatic SSI Medicaid. Medicaid is health insurance. This is a significant benefit. So long as the child remains eligible for SSI, the child receives SSI Medicaid.
SSI is the gift that keeps on giving. The disability determination SSI requires distinguishes SSI Medicaid from low-income Medicaid (also called Medicaid Expansion or MAGI Medicaid) that may be more vulnerable to budgetary restraint. Also, by maintaining SSI financial eligibility, one maintains financial eligibility for other vital state programs, including Medicare state supplements for premiums and prescription costs, Medicaid programs that follow the SSI counting rules such as Home and Community Based Services, access to group homes, low income housing, and more.
Preserving the “SSI First” Advantage of Keeping SSI Medicaid After Converting to Social Security Disability
Delaware has a special rule. It states if a person receives SSI and SSI Medicaid, but loses SSI (and the SSI Medicaid that goes with it) because he converts to Social Security Disability Insurance (SSDI), the person gets to keep his SSI Medicaid so long as the person remains otherwise eligible for SSI not counting the monthly SSDI. I call this the “leap frog” rule. Leap first on SSI, pick up the SSI Medicaid, then later leap to SSDI whether as Disabled Adult Child benefit or the person’s own SSDI.
Time and again I see clients come to us who have not followed this order. They’ve applied for Social Security benefits when the benefit they’re eligible for is SSDI, not SSI. If at the time of application, the person is eligible for SSI and SSDI, but the SSDI amount is higher than the full SSI, then the person gets SSDI only. The person does NOT get SSI and the SSI Medicaid that comes with it.
It is true the SSDI recipient receives Medicare after 2 years. Federal (Extra Help) and State Medicare Supplements (QMB, SLMB, QI) programs exist to supplement the Medicare, even without SSI Medicaid.
But SSI Medicaid preserves options, especially in the 2 year gap while waiting for Medicare, provides supplemental health insurance to Medicare, and is important to pick up when the child is 18.
III. Medicaid Transition
State Medicaid programs, including for children, are a dizzying alphabet soup of differing requirements.
In Delaware, childhood disability Medicaid does not end at a single age. The transition depends on the specific program.
SSI childhood disability standards change at age 18, while Children’s Community Alternative Disability Program (CCADP) (formerly “Disabled Children’s Program”) child Medicaid program generally ends at age 19.
CCADP is Delaware’s Katie Beckett-type program allowing children with significant disabilities to qualify without parental income deeming. Delaware regulations expressly limit eligibility to children under 19. Accordingly, a child aging out of CCADP must transition to an adult Medicaid pathway (SSI- Medicaid, Medicaid expansion, HCBS waiver, etc.) at 19.
Delaware’s DDDS Lifespan Waiver is unusual in that it can begin during childhood and continue into adulthood without automatically terminating at age 18. However, families still face major transitions at adulthood because Medicaid financial rules, SSI disability standards, and adult support systems all change during the transition years.
The above are just examples.
Parents should take a proactive approach nearing age 18 to learn what is the next appropriate Medicaid program and what the child must do to apply for it.
The State caseworker should be trained to answer the parent’s questions and connect to the next State resource.
Other resources include local non-profit organizations specific to the child’s disability such as Autism Delaware, Community Navigators such as through the Developmental Disabilities Council, and service organizations such as Easter Seals Delaware.
Many parents find it more than worthwhile when their child nears 18 to engage the services of a private outside provider called a Care Manager to create and carry out a Transition Plan. Care Managers are companies, often nationwide but with Delaware “boots on the ground,” whose representative is tasked with knowing the Delaware Medicaid and public benefits applicable to the child, advising the parents on what to do next and why, and then helping the parents apply for those benefits. Typically the Care Managers can be hired on a per-task basis, or on an ongoing basis such as to arrange in-home care, secure housing, create a Life Care Plan, and other hands-on services. Regardless, many find it useful to establish the relationship, however small at first. Later, many of those same parents – who are themselves aging and concerned about their child living alone - opt to try to what is a growing trend, called a Test Run, where parents deliberately step back for a short period of time to “test” the individuals and plan they’ve set up to look after their child when they can no longer do so.
Housing is a vital question in the choice of next Medicaid as group homes in Delaware generally require Medicaid and only certain type(s) at that.
IV. Estate Plan for Parents Providing for Child With Disability
Nearing 18 is the time for parents of the child turning 18 to plan: 1) WHO will assist their child in all facets – health care, finances, public benefits coordination, housing – should the parents become incapacitated or die, and 2) HOW.
The WHO and the HOW are the estate plan. The legal documents set that forth. As with Powers of Attorney or Guardianship for the child, it is essential for parents to select counsel who is experienced and expertise in estate planning for parents with children with disabilities. Too often we see legal documents prepared by others that must later be modified, often by court order, because counsel didn’t realize a provision was problematic, or because Social Security rejects the language, or because a provision does not meet a requirement of law that state or federal agencies are looking for in reviewing the trust.
Most parents want a sibling to hold the money for a disabled child. While a sibling may be involved, often it is better for the sibling to work alongside a professional, which can be an individual, who has the requisite legal, public benefits, accounting, and tax knowledge and can provide or arrange for those services as part of their daily business.
The WHO of the estate plan requires significant reflection and counseling. Expert counsel will have relationships with competent professionals of all services areas to whom to connect families. Expert counsel will insist on a plan whose role players are brought in early to accept the role, be educated on it, and develop a cadence to stay involved in the life of the child and family so the role players are ready when needed.
The HOW of the estate plan is for expert counsel to apply their legal expertise and prepare. The interface of public benefits law, retirement benefits, trust law, and tax law is complex and near-nonexistent because each area of law defines concepts differently. Separate third party supplemental needs trusts for non-retirement assets and retirement assets are often appropriate. Clients of significant means, with income-producing assets, and and/or with private businesses have particularly complex considerations we routinely address. Sometimes the child with a disability will need a first party supplemental needs trust for resources he has over $2,000, such as an inheritance, personal injury settlement, or his own funds. ABLE accounts are almost always a necessary adjunct for cash flow and client independence. The HOW of the estate plan is complex, but once understood, obvious in importance, and once prepared well, clear in carrying out.
Conclusion
Nearing 18 is the milestone all of these conversations must begin. Routinely parents come in inquiring about Powers of Attorney or guardianship, not realizing the additional Transition Planning needed. We meet the requested need and counsel on next steps. Nearing 18 is the time to break these considerations into manageable pieces and start to address them one by one, before it may be too late for some benefits. The goal is positioning for the child’s future.
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