Is There a Difference Between "Supplemental" and "Special" Needs Trusts?
You may have heard the terms "special" needs trust and "supplemental" needs trust and wondered what the difference is.
Two decades ago when the field of special needs planning began, trusts were created for people with disabilities, these were generally called supplemental needs trusts. The thinking was that the purpose of the trusts was to supplement the assistance provided by Medicaid, Medicare, Social Security, Supplemental Security Income and other public benefit programs, whose level of support is often meager.
The term "special needs trust" refers to the purpose of the trust -- to pay for the beneficiary's unique or special needs. In short, the name “special needs trust” is focused more on the beneficiary, while the name "supplemental needs trust" addresses the shortfalls of our public benefits programs.
The reference to the trusts as supplemental needs trusts rather than special needs trusts is something of a survival. Whether supplemental or special, the trusts serve the same purpose of helping meet the needs of individuals with disabilities while still permitting them to qualify for vital public benefits programs.
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