Planning for Disabled Children: Living Transitions Upon Older Adults’ Death

While everyone needs to plan for the future, it becomes critical for the parents of special needs and disabled children.

MITCHELL KITROSER, ESQ.

One of the most challenging aspects of my law practice concerns the need for parents of disabled and special needs children to plan ahead, not just beyond their own life expectancies, but also to the possibility that there will be a time during their lives when they will be unable to be helpful to their disabled child.

Oftentimes, I have encountered parents who are not only overseeing their children’s needs but are also acting as primary caregivers for their children. The initial conversations are sometimes difficult as a parent or parents confront their own mortality in conjunction with their child’s current and future financial, legal, medical, social, and residential needs. When we add into the discussion the fact that each child is unique with his or her own set of strengths and weaknesses, the complexity and nuance involved in this planning becomes apparent.

Every parent I have met is looking for the ideal plan to protect their child and give that child as rewarding and safe a life as possible. This discussion is intended to cover, at least partially, some of the major issues that need to be considered in planning for a child with disabilities.

It is an unfortunate truth that finances and the total of financial resources available to each family will significantly affect the quality of the protective bubble parents can create around a child. It is axiomatic that more money is better, although no guarantee of success. Money buys flexibility and options in housing, case managers, and financial advisors. Regardless of the limitations on the number of resources available, however, any plan is better than the failure to plan.

Let’s start off by taking a look at the failure to plan, which results in a 60-year old with disabilities living with parents in their mid to late eighties. The parents and the child have transitioned roles to the point where the child is now a caregiver instead of a care recipient. The parents are rapidly chewing through their life savings and their child has never lived outside their home. There is now a desperate need to make transitional decisions before one or both parents die or need skilled nursing care. Unfortunately, this transition is going to have to happen at a time in life when the 60-year old “child” is well set in his or her ways. Oftentimes, the parents are planning to rely upon their other child or children, who have lives and burdens of their own, to pick up the responsibilities for caring for their disabled sibling. This type of transition will not be easy for anyone in this family.

Planning for an adult child with disabilities requires consideration of legal, residential, social, medical, and financial issues. Legal matters involve the ability to make decisions about finances, medical treatment for oneself, and social and residential decisions.

Residential decisions involve where an individual with disabilities can safely and rewardingly live, whether independently, with family and familial assistance, in a group home setting, or in a facility. Social issues include concerns about safe and unsafe relationships, potential risk of exploitation, and even issues involving marriage. Medical decision making involves the ability of a child to make both basic and more complex medical decisions for him- or herself. Financial decisions involve the ability to handle and manage money, budget and pay bills, work, and contract.

Legal Issues

I approach the legal issues of planning for children with disabilities from the perspective of mental incapacity. Put simply, some people have greater mental incapacity challenges than others. To properly protect a person with issues of mental incapacity requires an initial analysis of the level of incapacity and a determination, from a legal perspective, of where that individual falls on the legal spectrum. Additionally, thought has to be given to whether the person is expected to maintain that level of capacity or see it improve or diminish over time. Capacity, to a lawyer in this context, means the ability to understand the nature of legal documents and the comprehension of the responsibility and authority being delegated to another person, usually a family member.

If a disabled child has the ability to understand legal documents, that child can, once he or she attains age eighteen or higher, sign a durable power of attorney (DPOA) and a designation of health care surrogate. The attorney-in-fact designated on the DPOA will have the legal power to handle most if not all things financial and contractual for the child, including dealing with insurance companies, obtaining disability benefits, paying bills, and managing finances for the child (Williams, n.d.a). The health care surrogate will have the authority to consult with medical professionals and make medical decisions for the child (Williams, n.d.b). Of course, care should be taken not only in the selection of individuals to fill these roles but also in selection of successors in the event the initially appointed person is unable to serve at some future time. Consideration also needs to be given to employing these documents to address a child’s needs if the child is susceptible to undue influence, since powers of attorney and health care surrogate documents can be changed by the child at a future time.

If the child is unable to understand the nature of the legal documents and was developmentally delayed, Florida law provides for the appointment of guardian advocates to handle these responsibilities. Guardian advocacy provides a family with the ability to protect a developmentally disabled child without the cost and intrusion of a full guardianship. Although there is some court involvement with guardian advocacies, the involvement is typically minimal, and retention of an attorney is not required once the case is created and ongoing (Florida State Statute on Guardian Advocacy, 2018).

For those children with disabilities that are not developmental in nature, the law provides for the appointment of guardians where necessary. In most cases involving families and disabled children, the guardian will be a family member and the process will not be unduly difficult. Unfortunately, some guardianship cases involving adult children come into being due to mental illness (typically schizophrenia or bipolar disorder). These cases can be difficult as the children often resist the attempt to help them and see it as an intrusion on their freedom.

Guardianships involve significant oversight by the court and the guardian is required to be represented by an attorney, which makes the process more costly. An attorney experienced in guardianship should be chosen because there are statutory requirements for actions by guardians and annual plans and accountings that will have to be filed. An experienced attorney will be able to guide the family and avoid mistakes that would lead to possible contempt hearings (Florida State Statutes chapter 744, 2018).

Regardless of which legal solution is employed, the goal is to provide someone who can make medical, financial, and in some cases, social decisions for the disabled person.

Residential And Social

Perhaps the most difficult issues for families of disabled children involve decisions about where a child will live and with whom that child will socialize. Parents, wanting to provide what is best for their child, often decide that their child is safest and happiest living at home with them. Putting aside for a moment the ongoing stress this arrangement puts on the parents, the other question to consider is whether keeping a disabled child at home is really in the child’s best interest from a long-term perspective. Life spans being what they are, parents will typically die before their children do. Each family needs to determine the wisdom of not moving a child into a residence outside the family home while the parents are young enough to oversee the transition and support their child during and after the move. Additionally, should the first transition not work as planned, making efforts earlier in the parent’s life span increases the likelihood that a parent can still modify and adapt the plan to suit the child’s needs. Over the years, I have found that this topic is the most difficult for parents to discuss. Nevertheless, I feel it is a vital component in a well-rounded life plan for a disabled child. The Special Needs Alliance (n.d.) has a resource list of residential options.

Medical

Until a child is eighteen years old, parents have the legal authority to make medical decisions for him or her. Once a child celebrates his or her eighteenth birthday, the child becomes an adult in society’s eyes and even the child’s parents lose the authority to speak with a young adult child’s doctors and nurses. This comes as a shock to unfortunate parents when a child gets injured while studying at a University away from home. Parents can discover, at the worst possible time, that the child would have to waive his or her privacy rights under HIPAA or the parents will not have the ability to speak with a child’s medical providers.

Another important concept to remember with respect to medical issues is that when a person appoints a health-care surrogate to make health-care decisions for him or her, the surrogate only has authority in the event that the person who appointed the surrogate is unable to make his or her own health-care decisions. For many parents of children with developmental disabilities, this limitation is insufficient to provide the parents with the legal authority that they feel is required to properly protect their child. For this reason, guardian advocacy or even guardianship is considered a preferable alternative when it comes to handling medical matters for developmentally delayed children or children with mental illnesses.

Financial

This exhaustive topic could be the subject of its own article. Resources available for a child will vary from one family to another and sometimes will change over the course of the parent’s lifetime. Additionally, the parents’ own needs as they age may interfere in the ability to provide a fully funded plan for their child.

The sheer amount of money needed for some children may, and often does, exceed the family’s ability to provide for that child. How much is needed will vary from child to child. Who a parent can trust with the money is yet another consideration that causes sleep-less nights. Changes in life circumstances for a parent, death of a spouse, remarriage, judgment creditors that arise due to future litigation, and dementia in the parent can all destroy a carefully crafted plan. Where the funding will come from is another issue requiring thought. An analysis of available government benefits should also be made, particularly if there is concern that there will be insufficient funds available.

To me, the perfect plan involves the creation of a trust to be managed by professionals but with family oversight. Many families resist the idea of using professional trustees due to the cost involved. Despite this understandable reluctance, I often advocate for using professionals, either exclusively or in partnership with families, because I believe that professionals provide advantages in a plan.

For one thing, a professional trust company offers consistency over time. Unlike humans, the trust company does not die. A professional trust company takes a fee but it never steals. If mismanagement occurs, it carries insurance and has a deep pocket. It has access to professional money managers for investment decisions. Some of my clients have been able to finance the funding of this trust from their own assets, but this is uncommon.

Usually, funding a disabled child’s trust includes the use of some family assets in conjunction with a whole life insurance policy that will fund the trust with sufficient assets to care for the child and pay for that child’s needs for the rest of the child’s life. The life insurance should be placed into the trust as soon as possible to avoid any risk of a future creditor attaching that policy or an exploitation occurring late in the parent’s life.

Depending upon the disabled child’s needs and the family’s resources, the cost of the policy may be anywhere from easily attainable to an enormous strain on the family’s remaining resources. When I draft, I like to appoint a “trust protector” in my trusts with the authority to replace the professional trustee with a new professional trustee in the event disagreements become problematic. Finally, the trust should include supplemental needs trust language in the event government disability benefits are required at some future time.

Significant analysis should be undertaken to determine what government benefits are available to any disabled child. For families with limited resources, qualification for Social Security Insurance, Medicaid, Section 8 housing, and food stamps can make the difference between a safe, albeit basic, existence and homelessness. For children with some means at their disposal, Social Security Disability Insurance and Medicare benefits may still be attainable, and those benefits will be significant over the child’s lifetime (Nelson-Reade, n.d.).

Summing Up

Planning for a child with disabilities requires the implementation of a multi-faceted approach to the overall life plan for a child. Regardless of the level of assets a family has to assist with their plan, the making of the plan is a vital to help ensure that the disabled child is as well supported as possible. Families also need to be mindful of the fact that we are all mortal and subject to life events at any time, putting any plan that depends upon one individual at risk. Good planning includes the layering of alternates for every role that parents think that their child could need in the future, when the parents are no longer able to supervise the plan they created.

Mitchell Kitroser

A 1982 graduate of St. John’s University School of Law, Mitchell Kitroser is the founder and managing attorney of Kitroser Lewis & Mighdoll, a law firm focusing on guardianship, elder law, wills, trusts, probate, trust administration, and litigation related to these areas of practice. The firm also assists with Medicaid planning, special needs planning and trusts, real estate transactions, small business matters, emergency planning, and end-of-life planning. The practice also assists personal injury attorneys with wrongful death litigation and catastrophic injury litigation.