Is a Settlement Planner Necessary When Your Client Doesn’t Want to Structure?

A commonly held belief in the legal community is that settlement planners only provide structured settlement services. Unfortunately, that misconception can lead to missed opportunities to protect claimants’ long-term financial security. While we believe that structures are a valuable financial option for most personal injury settlements, not all cases will be the right fit for a structure.

Here are 5 reasons to bring in a settlement planner on every case:

• Needs-based government benefits may be affected: Needs-based government benefits such as Medicaid (Medi-Cal in California), SSI, SNAP (food stamps), and subsidized housing use asset tests to determine eligibility. Assets as low as $2000 ($3000 if married) may disqualify a claimant from receiving needs-based benefits. A settlement planner needs to evaluate the impact of a settlement on government benefits and can work with the claimant to create a strategy for benefit preservation if needed.

• Your client may benefit from a Special Needs Trust: If your client is disabled and under age 65, placing the settlement proceeds in a special needs trust (SNT) can help preserve the proceeds, while allowing the claimant to maintain eligibility for needs-based government benefits. For claimants over the age of 65, a pooled special needs trust (PSNT) may be a viable option. Many trust companies have minimums for investment, but there are options for both SNTs and PSNTs that allow deposits of $100,000 or less. A settlement planner can help coordinate the establishment of the trust and the vetting of potential trustees.

• There may be outstanding liens: The presence of outstanding liens can be a major hindrance to settlement resolution. Moreover, making certain that there are no unrelated charges in the lien recovery is an important step that if bypassed, can spell trouble for the claimant’s attorney. A settlement planner can provide access to a reputable lien resolution expert to audit the lien report and assist your client with efficient lien resolution.

• Your client may need to consider a Medicare Set-Aside (MSA): If your client is currently on Medicare or expects to be within 30 months of the settlement and their recovery includes funds for medical costs, they may need to consider placing a portion of the settlement into a Medicare Set-Aside. With changes to the Liability Medicare Set-Aside process on the horizon, this is an especially important time to involve a settlement planner on your cases. A settlement planner can help determine whether an MSA is necessary and, if so, what the amount should be and how to fund the account.

• A structured settlement may still be an option as a funding instrument: Most people understand structured settlements as an alternative to a lump sum settlement. Even if your client doesn’t want to structure their settlement in the traditional sense, a structured settlement annuity can serve as a cost-effective funding tool for other types of financial vehicles. For instance, a structured settlement can be arranged to fund a special needs trust with regular payments. It can also be used for fund a Medicare Set-Aside account, saving the claimant money in the long run. A settlement planner will walk the claimant through all potential options to determine which alternatives best meet their needs.

Contact Traci Kaas to learn more

At Traci Kaas, we believe that all claimants deserve the opportunity to make informed decisions about their settlements. For more information, contact us today at 800-354-2258 or info@tracikaas.com.