There’s A New Financial Tool for Those with Disabilities

Details of Louisiana’s first pooled special needs trust

Louisiana’s first pooled special needs trust (PSNT) offers a new option for families and individuals with disabilities to manage their financial resources while maintaining access to essential government benefits.

The tool was created by Louisiana Guardianship Services, Inc. (LGSI), a Louisiana nonprofit organization established in 1992 that serves developmentally disabled and elderly adults across Louisiana. It is designed to serve families looking to provide long-term financial security for their loved ones with disabilities. With a PSNT, families no longer need to worry about how an inheritance, legal settlement, or other financial gift could affect their loved one’s benefits. Instead, these resources can be carefully managed within the trust, ensuring that the beneficiary continues to receive the support they need without interruption.

What is a Pooled Special Needs Trust?

A pooled special needs trust is a type of financial trust that allows individuals with disabilities to protect their assets without jeopardizing their eligibility for government programs like Medicaid and Supplemental Security Income (SSI). Many government benefits have strict income and asset limits, and receiving an inheritance or other funds could disqualify an individual from these programs. By placing those funds in a special needs trust, individuals can use the resources for their care while staying within the financial limits required to retain their benefits.

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Unlike individual special needs trusts, a pooled trust combines the resources of multiple beneficiaries into one collective investment fund. This pooled investment is managed by a nonprofit organization, which uses its expertise to maximize the financial benefits while keeping management fees low.

Each beneficiary has their own account within the trust, and funds are used specifically for their needs. The funds can be used for supplemental expenses, including medical care, education and other services that improve the quality of life for the beneficiary.

“The creation of Louisiana Guardianship’s Disability Pooled Trust marks a significant step forward to ensuring that individuals with disabilities can enjoy a higher quality of life and continued access to necessary support, all within a sustainable and charitable financial model,” said Jason Frank, professor of Elder Law at Tulane University Law School and founder of the First Maryland Disability Trust. “Working with LGSI’s staff attorney Steven Bain gives me confidence that LGSI is well-situated to provide this trust benefit to individuals with disabilities in Louisiana.”

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Benefits of a Pooled Special Needs Trust

1. Cost Efficiency One of the major advantages of a PSNT is the cost savings. Managing an individual special needs trust can be expensive, as legal and administrative fees quickly add up. However, a PSNT pools resources from multiple individuals, reducing the cost of managing each account. The pooled funds benefit from professional management without the high fees often associated with individual trusts, making this option more affordable for families with limited resources.

2. Professional Management A PSNT is managed by experienced professionals who specialize in navigating the complex rules surrounding government benefits for individuals with disabilities. This expertise helps ensure that the trust is administered properly, safeguarding the beneficiary’s eligibility for programs like Medicaid and SSI.

3. Flexibility and Customization While the funds are pooled for investment, each beneficiary has an individual account that can be tailored to their specific needs. The trust can be used for a wide range of expenses, including healthcare not covered by Medicaid, education, housing, therapy and recreational activities that improve the quality of life. The flexibility of a PSNT allows beneficiaries to enjoy a higher standard of living.

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4. Preservation of Government Benefits One of the most important benefits of a PSNT is its ability to preserve government benefits. Without a special needs trust, any funds received by an individual with a disability could push them over the asset limits set by Medicaid and SSI, resulting in the loss of vital benefits. By placing these funds into a PSNT, individuals can maintain their eligibility for these programs while using their own resources for supplemental needs.

5. Charitable Benefit Upon the death of a beneficiary, any remaining funds in their account do not go back to Medicaid, as is often required with individual trusts. Instead, these funds may be retained by the nonprofit. The retained funds are then used to support other individuals with disabilities. This creates a charitable legacy, benefiting future beneficiaries and enhancing the resources available to individuals in need.


Jason D. Asbill is a Louisiana attorney and the executive director of Louisiana Guardianship Services, Inc (LGSI). LGSI’s mission is to restore dignity and peace of mind to vulnerable adults through professional guardianship and advocacy when there is nobody else. For more information, visit www.laguardianship.org.

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