Lauren Allenberg’s new home in the city’s Green Tree neighborhood has an elevator and specially equipped bathrooms to accommodate her 5-year-old daughter, Ava, who has cerebral palsy and some developmental delays.
While Ms. Allenberg worked closely with the builder to customize the home, invoices for design features that meet specifications of the Americans with Disabilities Act were sent to the Achieva Family Trust on the South Side. The trust paid the bills from a fund it manages for Ava that was established with money her parents received in a legal settlement involving the hospital and doctors where Ava was born.
Ava’s parents also use the account to pay for some of her daily medical supplies and for special items like her modified stroller. Her mother hopes to tap into the money to buy a wheelchair-accessible van.
“I wanted the money from the settlement to go towards my daughter’s life plan,” said Lauren Allenberg, 34, who works as a business analyst for a financial firm. “With that amount of money, you don’t want to turn it over to the parents to blow or gamble away.”
Ms. Allenberg declined to disclose the settlement amount or terms of the case surrounding Ava’s birth injury, but said her attorneys recommended she and Ava’s father consider investing the cash at the Achieva Family Trust because putting the sum in a conventional bank or brokerage account could make Ava ineligible to receive state or federally funded disability benefits.
Federal law stipulates that people with disabilities can qualify for government assistance such as Supplemental Security Income and Medicaid only if their assets are less than $2,000 or less than $2,400 if they reside in a nursing home. But if assets greater than those amounts are held in a special needs trust, they don’t jeopardize government benefits and can be used for expenses ranging from Internet connections to medical equipment not covered by benefits or other insurance.
Established in 1998, the Achieva Family Trust was among the first of about six such trusts to be created in Pennsylvania. Others include the Arc Community Trust of Pennsylvania in King of Prussia and the Berks Community Trust in Sinking Spring, Berks County.
Since its launch, Achieva’s trust has grown to approximately $85 million in 2,100 individual accounts, said Amy Dolan Strano, trust president.
Its affiliate agency, Achieva, was founded in 1951 to provide support services for individuals with disabilities and their families. After a 1993 Congressional budget act authorized nonprofits to manage trusts for people with disabilities, the organization put together a committee of disability experts and parents to determine the feasibility of starting one.
Marsha Blanco, Achieva president and chief executive, and Richard Scott, an attorney who specializes in estates and trusts at Downtown firm Leech Tishman Fuscaldo & Lampl, “really got the ball rolling,” said Ms. Strano, an attorney who served on the initial planning committee and who chaired the trust’s before becoming its president in 2010.
Prior to establishment of such trusts, she said, families of people with disabilities wrangled with options for how to provide for their loved ones in the long term.
“In old estate planning policies, you would disinherit the person from the will because they would lose their government benefits,” said Ms. Strano. “If you had three children, you might leave your money to the other two and hope they would do the right thing and take care of the third with disabilities.”
Another issue that families encounter, she said, is that some banks and financial institutions may not be anxious to manage relatively small accounts for people with disabilities. “If someone gets $20,000 from Aunt Mary, the big banks are not interested in those smaller amounts,” she said. “Through the trust, we manage not just $20,000, but the entire pool.”
The minimum required to open a trust account at Achieva is $500 and the median value of its accounts now stands at $41,000, she said. “Some people have $1 million invested; some have $2,000. So it’s very accessible. We take the small amounts the banks won’t.”
Achieva offers three different types of accounts so families can decide how best to disperse the funds once the primary beneficiary dies.
For those in the pooled trust, when a balance remains in the account after the death of the person for which it was established, those assets become part of a charitable fund that Achieva distributes to other people with disabilities. That fund awards grants that can be used for items such as computer equipment, camp tuition or travel expenses.
In Achieva’s payback trust, funds remaining after the individual dies are used to reimburse the state Department of Public Welfare for any costs the department incurred to provide for that person’s medical care and expenditures. Any amount leftover can then be distributed to family or others as stipulated by the trust document, said Ms. Strano.
The third type is the common law trust funded entirely by family or friends but not by the individual’s own assets. No amounts need to be repaid to the state, and anything left when the individual dies can be distributed to beneficiaries named when the account was created.
All the trusts carry fees based on the size of the account, starting with 10 percent on balances up to $5,000. The fees are then graduated for accounts that exceed $33,001.
Most of Achieva’s accounts are in the pooled trust, said Ms. Strano. Many larger amounts are invested in payback trusts so that funds left over when the individual dies can go back to the family.
“My general impression is that a lot of Achieva trust’s accounts are smaller amounts of money,” said Frank Petrich, an attorney who specializes in elder law and who is of counsel to the firm Gray Elder Law.
“If I had $1 million, maybe I wouldn’t put it in Achieva’s pooled trust. [But] a lot of people don’t have that kind of money but they have a child with special needs and want to see that child protected.”
For them, he said, the common law or third-party trust might make more sense.
An advantage in investing with the Achieva trust, he said, is that its parent organization provides services to people with disabilities and has “knowledge of the disability community and resources available to help those with special needs.”
For Linda Jerick of Delmont, the Achieva trust has allowed her to provide care at home for her son, Adam Linsenbigler, who suffered a traumatic brain injury in a car accident in 2000.
Mr. Linsenbigler, 35, received an insurance settlement after the accident and receives disability payments. But his assets were too great for him to qualify for rehabilitation and therapy services, said Ms. Jerick.
After she learned about the Achieva trust, she invested her son’s money in the pooled trust so that he became eligible for the state’s Home and Community Based Waiver Program through which Medicaid pays for his therapies and allows him to live at home.
He works two days a week as a paper shredder for the Westmoreland County Blind Association in Greensburg, but requires an attendant to take him to and from the job. He cannot be left alone at home because he is mostly in a wheelchair and does not initiate tasks on his own, said his mother.
“His money is not much for what he’s had to deal with, but now it is available for his special needs,” said Ms. Jerick, who is her son’s primary caregiver.
For items not covered by her son’s medical benefits, such as a van equipped with a wheelchair lift and weekly therapeutic massages, she requests money from his trust account.
“They have very strict guidelines, which is fine with me,” she said, “If I didn’t have the trust, that money would be spent. I’m very grateful I can stay home and take care of him, and he gets the physical, occupational and speech therapy that he needs.”
Joyce Gannon: email@example.com or 412-263-1580.