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Aged, Blind and Disabled Manual Section: Financial Eligibility Requirements Policy Manual Number: 110.055 Chapter: ABD Trusts

May 1, 2026 Division of TennCare 5 d. Self-Settled Trust A self-settled trust is a trust created by a person with his own funds for his primary benefit. A self-settled trust is a countable resource. e. Special Needs Trust A Special Needs Trust is a trust: i. Established for the sole benefit of a disabled individual (as defined by the Social Security Act) who is under age 65 by: 1. The disabled individual; 2. A parent; 3. A grandparent; 4. A legal guardian; or 5. The court. ii. Established with assets of the disabled individual under age 65; and iii. Provides that upon the death of the disabled individual, the State of Tennessee will receive all amounts remaining in the trust up to the total amount of medical assistance paid on behalf of the individual during her lifetime. NOTE: This trust exclusion continues after the individual reaches age 65. However, the trust cannot be added to or otherwise augmented after the beneficiary reaches age 65. Funds contained in a Special Needs Trust are excluded as resources. Income of a Special Needs Trust is not counted as income to the disabled individual (beneficiary of the trust) unless actually distributed in the form of cash or in-kind payments for food or shelter. The Estate Recovery Unit must be notified of the existence of a Special Needs Trust, as well as when a TennCare Medicaid individual with a Special Needs Trust passes away. When the individual passes away, the closure notice will remind the family to contact the Estate Recovery Unit. f. Pooled Trust A pooled trust is a trust: i. Established for the sole benefit of a disabled person (as defined by the Social Security Administration (SSA)) by: 1. The disabled individual;