How do pooled account trusts work in Michigan?
A pooled account trust is a type of special needs trust run by a non-profit organization. Although the trust manages funds for many beneficiaries, each person has their own separate sub-account. The non-profit pools the funds for investment and administration, which usually results in lower costs and more stable management than creating a stand-alone trust for each individual.

When and why consider a pooled account trust?
A pooled trust can be a helpful option when:

• The individual receives, or is expected to receive, Medicaid or SSI but has assets—such as an inheritance, settlement, or savings—that would otherwise affect eligibility.
• Families or guardians want a cost-effective, professionally managed solution rather than setting up a private special needs trust.
• There is a need for funds to support quality-of-life or supplemental expenses without jeopardizing government benefits.

What Can a Pooled Trust Pay For?

A pooled trust is designed to cover expenses that improve a beneficiary’s quality of life without replacing benefits provided by Medicaid or SSI. Funds can be used for a wide range of supplemental needs, including:

• Personal care items and household supplies
• Clothing and seasonal necessities
• Phone, internet, and cable services
• Transportation costs, including rideshare, bus passes, or vehicle modifications
• Medical and dental care not covered by insurance
• Therapies, counseling, and assistive services
• Adaptive equipment and mobility aids
• Education, training, and vocational programs
• Recreation, hobbies, entertainment, and travel
• Companion services and in-home support not paid for by Medicaid
• Computer equipment, electronics, and communication tools
• Costs related to housing that do not count as food or basic shelter (to stay compliant with SSI rules)

These expenditures must directly benefit the individual and cannot be used for gifts, general cash withdrawals, or expenses that would violate government-benefits rules.

How a Michigan Pooled Trust Affects Medicaid and SSI

A properly drafted pooled account trust allows a person to preserve eligibility for means-tested benefits while still accessing funds for supplemental needs. Key points include:

• Assets placed in a pooled trust are not counted as resources for Medicaid or SSI eligibility, as long as the trust meets federal and state requirements.
• Depositing funds into a pooled trust can prevent disqualification, especially after receiving an inheritance, settlement, or back-pay award.
• Distributions must be made carefully—improper payments for food or shelter may reduce SSI benefits, though they usually do not affect Medicaid.
• Medicaid “payback” rules apply when the beneficiary dies, meaning remaining funds may be used to reimburse the state for medical assistance provided.
• Beneficiaries still receive their regular Medicaid and SSI benefits, with the trust supplementing—not replacing—those programs.
• The trust must be administered by a non-profit, which is a core requirement for assets to remain exempt under federal law.
• Funds must be used solely for the benefit of the disabled individual, which is essential for maintaining benefits.