A Comprehensive Legal Summary | Updated June 2026
Introduction and Definition
A Special Needs Trust (SNT) is a trust designed to hold assets for a person with a disability without those assets being counted as available resources for means-tested public benefit programs such as New Mexico Medicaid (administered by the New Mexico Health Care Authority, HCA) and federal Supplemental Security Income (SSI). A properly structured SNT allows a beneficiary to receive supplemental support — specialty medical care not covered by Medicaid, assistive technology, additional personal care hours, home and vehicle modifications, transportation, education, recreation, and quality-of-life enrichment — without jeopardizing the government health coverage and income support that underpin long-term care for people with severe disabilities.
New Mexico special needs trust law is governed by the New Mexico Uniform Trust Code (NMSA 1978, Chapter 46, Article 7), which New Mexico adopted to provide a comprehensive and modernized statutory framework for trust creation, administration, modification, and trustee duties. The New Mexico Uniform Trust Decanting Act (NMSA 1978, Chapter 46, Article 12) provides trustees with a statutory mechanism to transfer assets from an existing trust into a new, SNT-compliant trust — including a specific provision (Section 46-12-113) addressing trusts for beneficiaries with disabilities. New Mexico Medicaid trust treatment is governed by the New Mexico Administrative Code at NMAC 8.281.510, which codifies the state’s rules for recognized Medicaid trusts and income diversion instruments. All New Mexico SNTs must also comply with federal Medicaid law under 42 U.S.C. § 1396p(d)(4) and SSA policy governing the SSI program.
New Mexico presents several distinctive planning characteristics. New Mexico is an income-cap state — applicants whose gross monthly income exceeds $2,982/month require an Income Diversion Trust (New Mexico’s term for a Qualified Income Trust/Miller Trust) to access long-term care or Community Benefit Waiver Medicaid. New Mexico is one of nine community property states, which introduces spousal consent and asset characterization requirements that are absent in common law states. The Arc of New Mexico maintains two established pooled trust programs — a first-party pooled trust and a third-party pooled trust — providing accessible trust options for beneficiaries with more modest assets. And New Mexico’s Uniform Trust Decanting Act includes a specific statutory provision for decanting into a special needs trust, giving trustees a valuable remedial tool without requiring court involvement in many cases.
Types of Special Needs Trusts
New Mexico recognizes three primary types of special needs trusts under state and federal law:
First-Party (Self-Settled) Special Needs Trusts
A first-party SNT is funded with assets belonging to the person with the disability — most commonly proceeds from a personal injury settlement, a direct inheritance, or savings that would otherwise disqualify the individual from Medicaid or SSI. Because the beneficiary’s own resources fund the trust, a Medicaid payback provision is required at death. Key structural requirements include:
- The trust must be established for the sole benefit of a person with a disability as defined under the SSI program.
- The beneficiary must be under age 65 at the time the trust is established and first funded. No new assets may be added after the beneficiary’s 65th birthday, though the trust continues for assets already held.
- The trust must be irrevocable.
- The trust must be established by the beneficiary, a parent, grandparent, legal guardian, or a court. The Special Needs Trust Fairness Act of 2016 allows the beneficiary to establish their own first-party SNT.
- The beneficiary may not serve as sole trustee of their own first-party SNT without risk that the trust will be treated as a countable resource.
- The trustee must hold sole and absolute discretion over all distributions. Any ascertainable standard obligating payment will render the trust countable for Medicaid and SSI purposes.
- Distributions should be made directly to vendors and service providers rather than as cash to the beneficiary, to avoid creating countable income under SSI rules.
- The trust must specifically state that the New Mexico HCA shall be repaid prior to any other assistance programs upon the beneficiary’s death. If the beneficiary received Medicaid in more than one state, each state that provided Medicaid benefits must be reimbursed under NMAC 8.281.510.
Third-Party Special Needs Trusts
A third-party SNT — sometimes called a supplemental needs trust — is funded with assets belonging to someone other than the beneficiary: parents, grandparents, other family members, or friends. Because the beneficiary never owned these assets, no Medicaid payback is required at death. The grantor freely designates who receives remaining trust assets after the beneficiary’s death, making third-party SNTs the preferred vehicle for family estate planning, gifts, and life insurance proceeds.
New Mexico’s Uniform Trust Code provides strong discretionary and spendthrift trust protections. A beneficiary’s creditors generally cannot compel a trustee to make distributions from a purely discretionary trust, protecting third-party SNT assets from creditor claims throughout the beneficiary’s lifetime. Because the assets were never the beneficiary’s property, they also pass entirely outside the HCA Medicaid estate recovery framework at death.
In New Mexico’s community property context, third-party SNT funding by a married grantor requires careful analysis. New Mexico community property law provides that all property acquired by either spouse during marriage is presumed to be community property — owned equally by both spouses. A grantor cannot transfer community property into a trust, including a third-party SNT for a disabled family member, without the written consent of the other spouse. New Mexico SNT counsel should identify whether funding assets are separate property or community property before the trust is funded, and should obtain the non-contributing spouse’s written consent if community property is to be transferred.
Pooled Special Needs Trusts — The Arc of New Mexico
New Mexico is well served by an established in-state pooled trust infrastructure through The Arc of New Mexico Trust Fund. The Arc of New Mexico offers two pooled trust programs, each serving a distinct beneficiary population:
Arc NM Master Trust I (Pooled D4C First-Party Trust): Established in 1998, Master Trust I is a first-party pooled trust under 42 U.S.C. § 1396p(d)(4)(C). It accepts assets belonging to the person with a disability and allows the individual to maintain Medicaid and SSI eligibility while holding meaningful assets in a sub-account managed by The Arc. Upon the beneficiary’s death, the HCA Medicaid payback obligation applies to the sub-account balance, though The Arc may retain a portion for its charitable mission as permitted under federal law.
Arc NM Master Trust II (Third-Party Pooled Trust): Master Trust II is a third-party pooled trust for assets contributed by family members and others who are not the beneficiary. No Medicaid payback applies at death. Master Trust II provides professional pooled management for families who prefer a pooled structure over a standalone third-party SNT — often the most cost-effective option for smaller trust amounts.
The existence of two well-established in-state pooled trust programs distinguishes New Mexico from states in this series where no dedicated in-state pooled trust is available. Families who choose The Arc of New Mexico should confirm that their SNT counsel reviews the specific sub-account terms and trust agreement provisions for compliance with current NMAC 8.281.510 rules.
Requirements for Legal Compliance
For SNT assets to be excluded from countable resources under New Mexico Medicaid and SSI rules, the trust must satisfy the following structural requirements:
- The beneficiary cannot exercise an unrestricted right to withdraw trust assets.
- The trustee must hold sole and absolute discretion over all distributions — no ascertainable standard may obligate payment.
- The trust must supplement — not supplant, replace, or substitute for — the public benefits to which the beneficiary is entitled.
- First-party trusts must be irrevocable, limited to beneficiaries under age 65 at establishment, and include a Medicaid payback provision specifically identifying the NM HCA as the first-priority remainder beneficiary.
- The beneficiary may not serve as sole trustee of their own first-party SNT.
- The trust must provide for reasonable compensation to the trustee and must reimburse the HCA before any other assistance programs upon the beneficiary’s death (NMAC 8.281.510).
New Mexico is a 1634 state — SSI approval triggers automatic New Mexico Medicaid enrollment through a data link between the Social Security Administration and the HCA. No separate Medicaid application is required once SSI is granted. Enrollment in the Community Benefit (HCBS) Waiver and other waiver programs requires a separate application and is subject to functional eligibility and available slots.
New Mexico is an income-cap state for long-term care and Community Benefit Waiver Medicaid. A beneficiary whose gross monthly income exceeds $2,982/month cannot qualify for nursing home Medicaid or the Community Benefit Waiver without an Income Diversion Trust — New Mexico’s statutory term for the instrument more commonly called a Qualified Income Trust (QIT) or Miller Trust. The Income Diversion Trust must be established before the Medicaid application is submitted. Each month, the beneficiary deposits income exceeding $2,982 into the Income Diversion Trust; that income is then applied toward the cost of care and no longer counts toward the Medicaid income limit. At the beneficiary’s death, any funds remaining in the Income Diversion Trust are subject to HCA Medicaid payback.
The Income Diversion Trust is a distinct instrument from the beneficiary’s SNT, and the two must be carefully coordinated to avoid double-counting income or inadvertently affecting eligibility. The SNT holds the beneficiary’s non-income assets and funds supplemental distributions; the Income Diversion Trust channels excess monthly income to allowable care costs under strict HCA rules. Medical Fund Advisors’ professional administration model coordinates between both instruments to ensure that each performs its intended function without disrupting the other.
New Mexico’s Medicaid asset limit is $2,000 for a single individual. A properly structured SNT removes all trust assets from the countable resource calculation. New Mexico Medicaid estate recovery is administered by the HCA; recovery claims are filed against the beneficiary’s estate for Medicaid benefits paid on their behalf. New Mexico’s estate recovery is generally limited to the probate estate, and an irrevocable SNT whose assets do not pass through the probate estate provides reliable protection from HCA recovery claims at the first-party trust’s termination. Third-party SNT assets are not subject to HCA recovery claims at all.
Limitations on Disbursements
A New Mexico SNT trustee may pay for any goods and services that supplement what New Mexico Medicaid and SSI already provide. Permissible disbursements include supplemental medical care not covered by NM Medicaid, dental and vision services, assistive and adaptive technology, additional personal care hours beyond those funded by the Community Benefit Waiver, home and vehicle modifications, transportation, education, vocational training, recreational activities, entertainment, travel, telephone and internet services, clothing, and personal care items.
Two distribution rules govern the effect of disbursements on SSI:
Food: As of September 30, 2024, food is no longer classified as In-Kind Support and Maintenance (ISM) by SSA. A trustee may now pay for groceries, restaurant meals, food delivery, and dietary supplements without reducing the beneficiary’s SSI payment. Payments should go directly to vendors rather than as cash to the beneficiary.
Housing: Payments for shelter-related expenses — rent, mortgage, property taxes, utilities, and condominium fees — can still reduce SSI by up to the federal ISM cap (approximately $351/month in 2026). New Mexico SNT trustees should consult specialized counsel before making housing-related disbursements and should consider ownership structures that may reduce or eliminate ISM exposure. In New Mexico’s community property context, housing owned jointly with a spouse requires additional analysis before the SNT makes payments on that housing.
The Income Diversion Trust coordination note from the compliance section applies in the disbursement context as well. Trustees must ensure that SNT distributions do not inadvertently create income or resources that affect the Income Diversion Trust’s monthly calculation or the beneficiary’s Community Benefit Waiver eligibility. Medical Fund Advisors maintains the records and tracking systems necessary to ensure this coordination occurs seamlessly.
Ancillary Issues
New Mexico as a Community Property State
New Mexico is one of nine community property states, which has significant planning implications for SNT funding and administration. Under New Mexico law, all property acquired by either spouse during marriage is presumed to be community property — owned equally by both spouses regardless of whose name is on the title. Neither spouse may transfer community property into a trust without the other’s consent.
When a parent or grandparent wishes to create a third-party SNT for a family member with a disability, the funding assets must first be characterized as separate property (owned before marriage or received as a gift or inheritance during marriage) or community property. If they are community property, the non-contributing spouse must consent to the transfer. When a married beneficiary receives a personal injury settlement, New Mexico law governs the community property or separate property characterization of each component of the award (pain and suffering versus lost wages versus medical expenses), which should be analyzed by New Mexico counsel before the first-party SNT is funded.
A notable tax advantage of community property: when one spouse dies, both halves of community property receive a full step-up in income tax basis to fair market value. This double step-up — compared to the single step-up applicable in common law states — can significantly reduce capital gains tax exposure when community property assets held in trust or inherited by survivors are eventually sold. New Mexico SNT planners and trustees should factor this stepped-up basis opportunity into the overall wealth planning strategy for families of beneficiaries with disabilities.
New Mexico Uniform Trust Decanting Act — NMSA 46-12-113
New Mexico adopted the Uniform Trust Decanting Act, effective January 1, 2017, codified in NMSA 1978, Chapter 46, Article 12. Section 46-12-113 specifically addresses trusts for beneficiaries with disabilities. Under this provision, a special-needs fiduciary — meaning a trustee with discretion over distributions for a beneficiary with a disability — may exercise the decanting power to transfer assets from an existing trust (the first trust) into a second trust that qualifies as a special needs trust under federal law, provided the exercise furthers the purposes of the first trust.
This statutory provision is particularly valuable for families whose existing trusts — often created as part of a general estate plan or personal injury settlement before the beneficiary became disabled — lack SNT-compliant language. Rather than pursuing a court modification of the original trust, a trustee may be able to accomplish the necessary restructuring through a NMSA 46-12-113 decanting, saving time, cost, and legal uncertainty. New Mexico SNT counsel should confirm that the first trust’s terms satisfy the applicable discretionary standard before proceeding and should analyze whether the decanting could trigger an HCA Medicaid divestment or transfer-of-assets review.
Income Diversion Trusts — New Mexico’s Miller Trust
New Mexico uses the term ‘Income Diversion Trust’ for what other states call a Qualified Income Trust or Miller Trust. The income cap of $2,982/month applies to both nursing home Medicaid and the Community Benefit (HCBS) Waiver. Any beneficiary whose gross monthly income exceeds this level must establish a properly drafted Income Diversion Trust before applying for long-term care Medicaid coverage.
Key requirements for the Income Diversion Trust in New Mexico include: the trust must be established before the Medicaid application is filed; only the beneficiary’s income may be deposited; the trust must be irrevocable and the beneficiary may not serve as sole trustee; and NMAC 8.281.510 requires the trust to specifically state that the HCA will be reimbursed before any other assistance programs upon the beneficiary’s death. If the beneficiary received Medicaid in multiple states, each state’s Medicaid program must be reimbursed in the order specified by NMAC.
The practical interplay between the Income Diversion Trust and the beneficiary’s SNT requires careful monthly coordination. Each month the beneficiary’s income must be correctly segregated — with the amount exceeding $2,982 deposited into the Income Diversion Trust and directed toward care costs, and the SNT continuing to fund supplemental distributions from trust assets. Medical Fund Advisors maintains the administrative systems to track and coordinate both instruments accurately, ensuring compliance with HCA rules and SSA policy simultaneously.
NMAC 8.281.510 — New Mexico Recognized Medicaid Trusts
The New Mexico Administrative Code at NMAC 8.281.510 codifies the HCA’s rules for Medicaid-recognized trusts. These rules govern both the structure of SNTs (what the trust must contain to be excluded from countable resources) and the Income Diversion Trust requirements (what the income diversion instrument must contain to qualify income for exclusion from the income cap calculation). NMAC 8.281.510 specifies the payback priority language required in first-party SNTs and Income Diversion Trusts, the conditions under which trust disbursements may be treated as countable income, and the procedures for HCA trust review.
Trustees and counsel drafting New Mexico SNTs should confirm compliance with the most current version of NMAC 8.281.510, as administrative code provisions can be amended through the rulemaking process independently of legislation. Medical Fund Advisors tracks NMAC updates and advises trustees when changes to HCA trust policy require adjustments to distribution practices or trust administration procedures.
New Mexico ABLE — STABLE Account
New Mexico residents with disabilities may open ABLE accounts through STABLE Account, a national ABLE savings program administered by the Ohio Treasurer of State and available to residents of participating states including New Mexico. Key 2026 features include:
Annual contributions from all sources are capped at $20,000. Employed beneficiaries may contribute an additional amount up to $15,560 above the standard cap under the ABLE to Work provision.
Account balances up to $100,000 are exempt from SSI resource counting. Balances above $100,000 suspend (but do not terminate) SSI eligibility.
New Mexico state income tax deduction: New Mexico offers a state income tax deduction for ABLE account contributions. The specific deduction amount should be confirmed with the New Mexico Taxation and Revenue Department for the current tax year, as the deduction structure has evolved with recent legislative changes. Contributing family members who file New Mexico income tax returns should confirm eligibility for the deduction with a New Mexico tax professional.
STABLE Account aggregate limit: The STABLE Account program’s aggregate limit for New Mexico accounts is $541,000 — among the highest in this series — providing substantial long-term accumulation capacity for beneficiaries who make consistent contributions over many years.
The ABLE Age Adjustment Act, effective January 2026, raises the qualifying disability onset age from 26 to 46, substantially expanding eligibility for New Mexico residents.
ABLE account estate recovery: New Mexico’s HCA exercises Medicaid payback rights against ABLE account balances at the account holder’s death for Medicaid benefits paid after the account was opened. Families may combine a third-party SNT (no payback) with a STABLE Account (tax-advantaged spending), with the SNT funding the ABLE account for day-to-day supplemental expenses while the SNT serves as the primary investment vehicle.
New Mexico Community Benefit Waiver
New Mexico’s primary HCBS program is the Community Benefit (CB) Waiver, administered by the HCA. The Community Benefit Waiver provides services for eligible individuals with disabilities and seniors who require a nursing facility level of care but choose to remain in community settings — their home, a family member’s home, or a supported living arrangement.
Services available under the Community Benefit Waiver include personal care assistance, adult day health services, home health aide services, home modifications, assistive technology, transportation, respite care, and care coordination. Financial eligibility requires gross monthly income below $2,982/month (or an established Income Diversion Trust) and assets below $2,000. Functional eligibility requires a nursing facility level of care determination by HCA.
New Mexico also operates separate waiver programs for individuals with developmental disabilities through the Developmental Disabilities Supports Division (DDSD), providing community-based supports including residential habilitation, day habilitation, employment support, and behavioral supports. Access to DD waiver services may involve a waitlist, and families should begin the application process early. SNT trustees coordinating with Community Benefit Waiver or DD waiver service plans should ensure that trust distributions supplement and do not duplicate waiver-funded services, preserving the trust’s value for items and services the waiver does not cover.
Administration and Oversight
New Mexico SNT administration involves a distinctive combination of complexity: income-cap state mechanics requiring an Income Diversion Trust, community property law affecting how assets may be transferred into trust, a well-established in-state pooled trust infrastructure through The Arc of New Mexico, and HCA trust rules under NMAC 8.281.510 that require careful compliance. Professional administration is the sound choice for any New Mexico SNT of meaningful size, providing the expertise to navigate these intersecting requirements reliably over what may be a decades-long administration.
The Complexity of the Role Demands Expertise
A New Mexico SNT trustee must simultaneously navigate federal SSI rules, HCA Medicaid policy under NMAC 8.281.510, the income-cap and Income Diversion Trust mechanics, community property considerations for married beneficiaries, Community Benefit Waiver and DD waiver service plan coordination, and the trustee duties imposed by the New Mexico Uniform Trust Code. The monthly Income Diversion Trust calculation and deposit must be accurately executed without triggering SSI income complications, and the SNT’s supplemental distributions must be structured to avoid inadvertent conflicts with waiver service plans. The NMSA 46-12-113 decanting option provides a structural tool for non-compliant trusts, but ongoing administration still requires the continuous expertise and institutional support that individual trustees rarely possess.
Trustees owe a fiduciary duty to act at all times in the beneficiary’s best interests under the New Mexico Uniform Trust Code. Errors in Income Diversion Trust administration — an incorrect deposit amount, a missed monthly deposit, a distribution to the wrong party — can result in a month of Medicaid ineligibility. Errors in SNT distribution — a housing payment that creates unexpected ISM, a cash distribution that becomes countable income — can affect SSI. These risks underscore the importance of professional trustees working with experienced administrators.
Professionals Bring Specialized Knowledge That Protects Benefits
With Medical Fund Advisors serving as professional administrator, legal counsel and families gain a partner with deep expertise in HCA Medicaid policy under NMAC 8.281.510, Income Diversion Trust and SNT coordination, community property funding analysis, Community Benefit Waiver service plan alignment, and The Arc of New Mexico pooled trust structures. Medical Fund Advisors ensures that monthly Income Diversion Trust calculations are correctly executed, that SNT distribution records satisfy HCA documentation requirements, and that community property considerations are properly addressed when trust funding occurs. For beneficiaries enrolled in the Community Benefit Waiver or DD waiver, Medical Fund Advisors coordinates distribution planning with the active service plan to maximize the benefit of trust resources without jeopardizing waiver eligibility.
Separating Trustee and Administrative Roles Adds Oversight
A professional trustee makes the fiduciary decisions: authorizing distributions, overseeing trust investments, ensuring compliance with NMAC 8.281.510 and the Uniform Trust Code, and maintaining the Income Diversion Trust relationship with HCA. Medical Fund Advisors handles day-to-day administrative operations: monthly Income Diversion Trust tracking, SNT distribution recordkeeping, bill payment, vendor coordination, waiver service plan alignment, and HCA reporting. This dual-role structure adds a critical layer of oversight in New Mexico’s complex planning environment, reducing error risk and ensuring no single party bears the full burden of simultaneous Income Diversion Trust and SNT administration.
The Recommended Structure
Best practice for New Mexico SNTs is a layered arrangement: a professional trustee handles fiduciary decision-making and NMAC 8.281.510 compliance; Medical Fund Advisors serves as day-to-day professional administrator handling Income Diversion Trust coordination, SNT distribution recordkeeping, community property analysis support, waiver service plan alignment, and vendor payments; and a trusted family member or advocate serves as trust protector with the power to review accounts and remove or replace the professional trustee if warranted. The beneficiary should not hold trust protector removal power over a first-party SNT. This layered structure is fully consistent with the New Mexico Uniform Trust Code and provides the governance depth appropriate for the multi-instrument complexity that New Mexico’s income cap environment creates.
New Mexico Idiosyncrasies
1634 State — SSI Triggers Automatic Medicaid: New Mexico automatically enrolls SSI recipients in Medicaid. No separate Medicaid application is required. Community Benefit Waiver and DD waiver enrollment requires separate functional and financial eligibility determinations and is subject to available slots.
Income Cap State — Income Diversion Trust Required: New Mexico is an income-cap state for long-term care and Community Benefit Waiver Medicaid. Beneficiaries with gross monthly income above $2,982/month must establish an Income Diversion Trust — New Mexico’s statutory term for the QIT/Miller Trust — before applying for Medicaid. The Income Diversion Trust must pre-exist Medicaid approval and is subject to HCA payback at the beneficiary’s death. The Income Diversion Trust is a distinct instrument from the SNT and must be carefully coordinated with it each month.
Community Property State — Spousal Consent and Characterization Analysis: New Mexico is one of nine community property states. All property acquired during marriage is presumed community property. A spouse cannot transfer community property into a trust — including a third-party SNT — without the other spouse’s written consent. When a married beneficiary receives a personal injury settlement, the community property characterization of each component must be analyzed by New Mexico counsel before the first-party SNT is funded.
Double Step-Up in Basis on Community Property: Upon the death of one spouse in a community property state, both halves of community property receive a full step-up in income tax basis to fair market value — a significant capital gains tax advantage compared to common law states. New Mexico SNT planners and trustees should factor this stepped-up basis opportunity into overall wealth planning for families of beneficiaries with disabilities.
NMSA 46-12-113 — Trust Decanting Into SNT: New Mexico’s Uniform Trust Decanting Act (effective January 1, 2017) includes a specific provision authorizing trustees to decant assets from an existing trust into a special needs trust for a beneficiary with a disability, provided the exercise furthers the purposes of the first trust. This is a valuable remedial tool for families whose prior estate planning predates the beneficiary’s disability or whose existing trust terms would jeopardize public benefit eligibility.
NMAC 8.281.510 — HCA Recognized Medicaid Trusts: New Mexico’s Administrative Code governs the structure and administration requirements for both SNTs and Income Diversion Trusts used in the Medicaid context. NMAC 8.281.510 specifies required payback priority language, conditions for countable income treatment of distributions, and HCA review procedures. Trustees and counsel must verify compliance with the current version of NMAC at the time the trust is drafted and must monitor for administrative code updates that may affect administration.
Arc of New Mexico — Established In-State Pooled Trusts: The Arc of New Mexico Trust Fund operates two pooled trust programs: Master Trust I (first-party D4C trust, established 1998) and Master Trust II (third-party pooled trust). These provide accessible, professionally managed pooled trust options for New Mexico beneficiaries whose assets are too modest to justify a standalone SNT with a professional trustee. New Mexico’s in-state pooled trust infrastructure is notably more developed than in many other states in this series.
New Mexico Uniform Trust Code: New Mexico adopted the Uniform Trust Code (NMSA Chapter 46, Article 7), providing a comprehensive statutory framework for trust creation, administration, and modification. Strong discretionary and spendthrift trust protections support SNT administration by insulating trust assets from creditor claims.
STABLE Account for ABLE — High $541,000 Limit: New Mexico residents access ABLE savings through STABLE Account (Ohio-administered). The aggregate account limit of $541,000 is among the highest in this series. Annual contributions are capped at $20,000 ($35,560 with ABLE to Work). A New Mexico state income tax deduction may be available for contributions — confirm the current amount with a New Mexico tax professional. HCA exercises Medicaid payback rights against ABLE balances at death.
Medicaid Recovery from Multi-State Recipients: NMAC 8.281.510 contains an uncommon explicit provision: if the beneficiary received Medicaid in more than one state, each state’s Medicaid program must be reimbursed in priority order specified by the rule. For beneficiaries who have lived in multiple states and received Medicaid coverage in more than one, the first-party SNT payback provision must account for multi-state recovery obligations. This is a distinctive New Mexico drafting requirement that SNT counsel should address explicitly.
Disclaimer: This summary is for general informational purposes only and does not constitute legal advice. New Mexico HCA Medicaid policy under NMAC 8.281.510, the New Mexico Uniform Trust Code, the New Mexico Uniform Trust Decanting Act, community property law, and applicable federal statutes are subject to change, and the application of New Mexico special needs trust law to individual circumstances requires analysis by a qualified New Mexico attorney experienced in special needs planning, elder law, and community property.
Prepared by Medical Fund Advisors | [email protected] | www.trustmfa.com