REPRESENTATIVE Salerno

To amend sections 1339.51, 5111.15, and 5121.04 of

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the Revised Code relative to the creation of

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trusts to fund supplemental services for certain

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beneficiaries with physical or mental

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disabilities.

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BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 1339.51, 5111.15, and 5121.04 of the	6
Revised be amended to read as follows:	7

Sec. 1339.51.  (A) As used in this section:

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(1) "Ascertainable standard" includes a standard in a trust	9
instrument requiring the trustee to provide for the care, comfort,	10
maintenance, welfare, education, or general well-being of the	11
beneficiary.	12

(2) "Disability" means any substantial, medically	13
determinable impairment that can be expected to result in death or	14
that has lasted or can be expected to last for a continuous period	15
of at least twelve months, except that "disability" does not	16
include an impairment that is the result of abuse of alcohol or	17
drugs.	18

(3) "Political subdivision" and "state" have the same	19
meanings as in section 2744.01 of the Revised Code.	20

(4) "Supplemental services" means services specified by rule	21
of the department of mental health under section 5119.01 of the	22
Revised Code or the department of mental retardation and	23
developmental disabilities under section 5123.04 of the Revised	24
Code that are provided to an individual with a disability in	25
addition to services hethe individual is eligible to receive	26
under programs authorized by federal or state law.	27

(B) Any person may create a testamentary trust under this	28
section to provide funding for supplemental services for the	29
benefit of another individual who meets either of the following	30
conditions:	31

(1) The individual has a physical or mental disability and	32
is eligible to receive services through the department of mental	33
retardation and developmental disabilities or a county board of	34
mental retardation and developmental disabilities;	35

(2) The individual has a mental disability and is eligible	36
to receive services through the department of mental health or a	37
board of alcohol, drug addiction, and mental health services.	38

The trust may confer discretion upon the trustee and may	39
contain specific instructions or conditions governing the exercise	40
of the discretion.	41

(C) The general division of the court of common pleas and	42
the probate court of the county in which the beneficiary of a	43
trust authorized by division (B) of this section resides or is	44
confined have concurrent original jurisdiction to hear and	45
determine actions pertaining to the trust. In any action	46
pertaining to the trust in a court of common pleas or probate	47
court and in any appeal of the action, all of the following apply	48
to the trial or appellate court:	49

(1) The court shall render determinations consistent with	50
the testator's or other settlor's intent in creating the trust, as	51
evidenced by the terms of the trust instrument.	52

(2) The court may order the trustee to exercise discretion	53
that the trust instrument confers upon himthe trustee only if the	54
instrument contains specific instructions or conditions governing	55
the exercise of that discretion and the trustee has failed to	56
comply with the instructions or conditions. In issuing an order	57
pursuant to this division, the court shall require the trustee to	58
exercise histhe trustee's discretion only in accordance with the	59
instructions or conditions.	60

(3) The court may order the trustee to maintain the trust	61
and distribute assets in accordance with rules adopted by the	62
director of mental health under section 5119.01 of the Revised	63
Code or the director of mental retardation and developmental	64
disabilities under section 5123.04 of the Revised Code if the	65
trustee has failed to comply with such rules.	66

(D) To the extent permitted by federal law and subject to	67
the provisions of division (C)(2) of this section pertaining to	68
the enforcement of specific instructions or conditions governing a	69
trustee's discretion, a trust authorized by division (B) of this	70
section that confers discretion upon the trustee shall not be	71
considered an asset or resource of the beneficiary, histhe	72
beneficiary's estate, the settlor, or the testator'ssettlor's	73
estate and shall be exempt from the claims of creditors, political	74
subdivisions, the state, other governmental entities, and other	75
claimants against the beneficiary, histhe beneficiary's estate,	76
the settlor, or the testator'ssettlor's estate, including claims	77
based on provisions of Chapters 5111., 5121., or 5123. of the	78
Revised Code and claims sought to be satisfied by way of a civil	79
action, subrogation, execution, garnishment, attachment, judicial	80
sale, or other legal process, if all of the following apply:	81

(1) At the time the trust is created, the trust principal	82
does not exceed the maximum amount determined under division (E)	83
of this section;	84

(2) The trust instrument contains a statement of the	85
testator'ssettlor's intent, or otherwise clearly evidences his	86
the settlor's intent, that the beneficiary does not have authority	87
to compel the trustee under any circumstances to furnish the	88
beneficiary with minimal or other maintenance or support, to make	89
payments from the principal of the trust or from the income	90
derived from the principal, or to convert any portion of the	91
principal into cash, whether pursuant to an ascertainable standard	92
specified in the instrument or otherwise;	93

(3) The testator is deceased;

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(4) The trust instrument provides that trust assets can be	95
used only to provide supplemental services, as defined by rule of	96
the director of mental health under section 5119.01 of the Revised	97
Code or the director of mental retardation and developmental	98
disabilities under section 5123.04 of the Revised Code, to the	99
beneficiary;	100

(5)(4) The trust is maintained and assets are distributed in	101
accordance with rules adopted by the director of mental health	102
under section 5119.01 of the Revised Code or the director of	103
mental retardation and developmental disabilities under section	104
5123.04 of the Revised Code;	105

(6)(5) The trust instrument provides that on the death of	106
the beneficiary, a portion of the remaining assets of the trust,	107
which shall be not less than fifty per cent of such assets, will	108
be deposited to the credit of the services fund for individuals	109
with mental illness created by section 5119.17 of the Revised Code	110
or the services fund for individuals with mental retardation and	111
developmental disabilities created by section 5123.40 of the	112
Revised Code.	113

(E) In 1994, the trust principal maximum amount for a trust	114
created under this section shall be two hundred thousand dollars.	115
The maximum amount for a trust created under this section prior to	116
the effective date of this amendmentNovember11, 1994, may be	117
increased to two hundred thousand dollars.	118

In 1995, the maximum amount for a trust created under this	119
section shall be two hundred two thousand dollars. Each year	120
thereafter, the maximum amount shall be the prior year's amount	121
plus two thousand dollars.	122

(F) This section does not limit or otherwise affect the	123
creation, validity, interpretation, or effect of any trust that is	124
not created under this section.	125

Sec. 5111.15.  If a recipient of medical assistance is the	126
beneficiary of a trust created pursuant to section 1339.51 of the	127
Revised Code, then, notwithstanding any contrary provision of this	128
chapter or of a rule adopted pursuant to this chapter, divisions	129
(C) and (D) of that section shall apply in determining the assets	130
or resources of the recipient, histhe recipient's estate, the	131
settlor, or the testator'ssettlor's estate and to claims arising	132
under this chapter against the recipient, histhe recipient's	133
estate, the settlor, or the testator'ssettlor's estate.	134

Sec. 5121.04.  (A) The department of mental health and the	135
department of mental retardation and developmental disabilities	136
shall investigate the financial condition of the patients in	137
hospitals and residents in institutions, residents whose care or	138
treatment is being paid for in a private facility or home under	139
the control of the department of mental retardation and	140
developmental disabilities, and of the relatives named in section	141
5121.06 of the Revised Code as liable for the support of such	142
patients or residents, in order to determine the ability of any	143
patient, resident, or such relatives to pay for the support of the	144
patient or resident and to provide suitable clothing as required	145
by the superintendent of the institution.	146

The department of mental health shall investigate the	147
financial condition of patients receiving state-operated community	148
mental health services and of the liable relatives to determine	149
the patient's or relative's ability to pay for the patient's	150
support. In all cases, in determining ability to pay and the	151
amount to be charged, due regard shall be had for others who may	152
be dependent for support upon such relatives or the estate of the	153
patient.	154

(B) The department shall follow the provisions of this	155
division in determining the ability to pay of a patient or	156
resident or the patient's or resident's liable relatives and the	157
amount to be charged such patient or resident or liable relatives.	158

(1) Subject to divisions (B)(10) and (11) of this section, a	159
patient or resident without dependents shall be liable for the	160
full applicable cost. A patient or resident without dependents	161
who has a gross annual income equal to or exceeding the sum of the	162
full applicable cost, plus fifty dollars per month, regardless of	163
the source of such income, shall pay currently the full amount of	164
the applicable cost; if the patient's or resident's gross annual	165
income is less than such sum, not more than fifty dollars per	166
month shall be kept for personal use by or on behalf of the	167
patient or resident, except as permitted in the state plan for	168
providing medical assistance under Title XIX of the "Social	169
Security Act," 49 Stat. 620 (1935), 42 U.S.C. 301, as amended, and	170
the balance shall be paid currently on the patient's or resident's	171
support. Subject to divisions (B)(10) and (11) of this section,	172
the estate of a patient or resident without dependents shall pay	173
currently any remaining difference between the applicable cost and	174
the amounts prescribed in this section, or shall execute an	175
agreement with the department for payment to be made at some	176
future date under terms suitable to the department. However, no	177
security interest, mortgage, or lien shall be taken, granted, or	178
charged against any principal residence of a patient or resident	179
without dependents under an agreement or otherwise to secure	180
support payments, and no foreclosure actions shall be taken on	181
security interests, mortgages, or liens taken, granted, or charged	182
against principal residences of patients or residents prior to	183
October 7, 1977.	184

(2) The ability to pay of a patient or resident with	185
dependents, or of a liable relative of a patient or resident	186
either with or without dependents, shall be determined in	187
accordance with the patient's, resident's, or liable relative's	188
income or other assets, the needs of others who are dependent on	189
such income and other assets for support, and, if applicable,	190
divisions (B)(10) and (11) of this section.	191

For the first thirty days of care and treatment of each	192
admission and for the first thirty days of care and treatment from	193
state-operated community mental health services, but in no event	194
for more than thirty days in any calendar year, the mentally ill	195
patient or mentally retarded resident with dependents or the	196
liable relative of a mentally ill patient or a mentally retarded	197
resident either with or without dependents shall be charged an	198
amount equal to the percentage of the average applicable cost	199
determined in accordance with the schedule of adjusted gross	200
annual income contained after this paragraph. After such first	201
thirty days of care and treatment, such mentally ill patient or	202
mentally retarded resident or such liable relative shall be	203
charged an amount equal to the percentage of a base support rate	204
of four dollars per day for mentally ill patients and mentally	205
retarded residents, as determined in accordance with the schedule	206
of gross annual income contained after this paragraph, or in	207
accordance with division (B)(5) of this section. Beginning	208
January 1, 1978, the department shall increase the base rate when	209
the consumer price index average is more than 4.0 for the	210
preceding calendar year by not more than the average for such	211
calendar year.	212

Footnote a. The patient or resident or relative shall	233
furnish a copy of the patient's, resident's, or relative's federal	234
income tax return as evidence of gross annual income.	235

Footnote b. The number of dependents includes the liable	236
relative but excludes the patient or resident in the hospital or	237
institution. "Dependent" includes any person who receives more	238
than half the person's support from the patient or the patient's	239
liable relative.	240

(3) A patient or resident or liable relative having medical,	241
funeral, or related expenses in excess of four per cent of the	242
adjusted gross annual income, which expenses were not covered by	243
insurance, may adjust such gross annual income by reducing the	244
adjusted gross annual income by the full amount of such expenses.	245
Proof of such expenses satisfactory to the department must be	246
furnished.	247

(4) Additional dependencies may be claimed if:

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(a) The liable relative is blind;

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(b) The liable relative is over sixty-five;

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(c) A child is a college student with expenses in excess of	251
fifty dollars per month;	252

(d) The services of a housekeeper, costing in excess of	253
fifty dollars per month, are required if the person who normally	254
keeps house for minor children is the patient or resident.	255

(5) If with respect to any patient or resident with	256
dependents there is chargeable under division (B)(2) of this	257
section less than fifty per cent of the applicable cost or, if the	258
base support rate was used, less than fifty per cent of the amount	259
determined by use of the base support rate, and if with respect to	260
such patient or resident there is a liable relative who has an	261
estate having a value in excess of fifteen thousand dollars or if	262
such patient or resident has a dependent and an estate having a	263
value in excess of fifteen thousand dollars, there shall be paid	264
with respect to such patient or resident a total of fifty per cent	265
of the applicable cost or the base support rate amount, as the	266
case may be, on a current basis or there shall be executed with	267
respect to such patient or resident an agreement with the	268
department for payment to be made at some future date under terms	269
suitable to the department.	270

(6) When a person has been a patient or resident for fifteen	271
years and the support charges for which a relative is liable have	272
been paid for the fifteen-year period, the liable relative shall	273
be relieved of any further support charges.	274

(7) The department shall accept voluntary payments from	275
patients or residents or liable relatives whose incomes are below	276
the minimum shown in the schedule set forth in this division. The	277
department also shall accept voluntary payments in excess of	278
required amounts from both liable and nonliable relatives.	279

(8) If a patient or resident is covered by an insurance	280
policy, or other contract that provides for payment of expenses	281
for care and treatment for mental illness or mental retardation at	282
or from an institution, facility (including a hospital or	283
community service unit under the jurisdiction of the department),	284
or state-operated community mental health service, the other	285
provisions of this section, except divisions (B)(8), (10), and	286
(11) of this section, and of section 5121.03 of the Revised Code	287
shall be suspended to the extent that such insurance policy or	288
other contract is in force, and such patient or resident shall be	289
charged the full amount of the applicable cost. Any insurance	290
carrier or other third party payor providing coverage for such	291
care and treatment shall pay for this support obligation in an	292
amount equal to the lesser of either the applicable cost or the	293
benefits provided under the policy or other contract. Whether or	294
not an insured, owner of, or other person having an interest in	295
such policy or other contract is liable for support payments under	296
other provisions of this chapter, the insured, policy owner, or	297
other person shall assign payment directly to the department of	298
all assignable benefits under the policy or other contract and	299
shall pay over to the department, within ten days of receipt, all	300
insurance or other benefits received as reimbursement or payment	301
for expenses incurred by the patient or resident or for any other	302
reason. If the insured, policy owner, or other person refuses to	303
assign such payment to the department or refuses to pay such	304
received reimbursements or payments over to the department within	305
ten days of receipt, the insured's, policy owners', or other	306
person's total liability for the services equals the applicable	307
statutory liability for payment for the services as determined	308
under other provisions of this chapter, plus the amounts payable	309
under the terms of the policy or other contract. In no event	310
shall this total liability exceed the full amount of the	311
applicable cost. Upon its request, the department is entitled to	312
a court order that compels the insured, owner of, or other person	313
having an interest in the policy or other contract to comply with	314
the assignment requirements of this division or that itself serves	315
as a legally sufficient assignment in compliance with such	316
requirements. Notwithstanding section 5122.31 of the Revised Code	317
and any other law relating to confidentiality of records, the	318
managing officer of the institution or facility where a person is	319
or has been a patient or resident, or the managing officer of the	320
state-operated community mental health services from which the	321
patient receives services, shall disclose pertinent medical	322
information concerning the patient or resident to the insurance	323
carrier or other third party payor in question, in order to effect	324
collection from the carrier or payor of the state's claim for care	325
and treatment under this division. For such disclosure, the	326
managing officer is not subject to any civil or criminal	327
liability.	328

(9) The rate to be charged for pre-admission care,	329
after-care, day-care, or routine consultation and treatment	330
services shall be based upon the ability of the patient or	331
resident or the patient's or resident's liable relatives to pay.	332
When it is determined by the department that a charge shall be	333
made, such charge shall be computed as provided in divisions	334
(B)(1) and (2) of this section.	335

(10) If a patient or resident with or without dependents is	336
the beneficiary of a trust created pursuant to section 1339.51 of	337
the Revised Code, then, notwithstanding any contrary provision of	338
this chapter or of a rule adopted pursuant to this chapter,	339
divisions (C) and (D) of that section shall apply in determining	340
the assets or resources of the patient or resident, the patient's	341
or resident's estate, the settlor, or the testator'ssettlor's	342
estate and to claims arising under this chapter against the	343
patient or resident, the patient's or resident's estate, the	344
settlor, or the testator'ssettlor's estate.	345

(11) If the department of mental retardation and	346
developmental disabilities waives the liability of an individual	347
and the individual's liable relatives pursuant to section 5123.194	348
of the Revised Code, the liability of the individual and relative	349
ceases in accordance with the waiver's terms.	350

(C) The department may enter into agreements with a patient	351
or resident or a liable relative for support payments to be made	352
in the future. However, no security interest, mortgage, or lien	353
shall be taken, granted, or charged against any principal family	354
residence of a patient or resident with dependents or a liable	355
relative under an agreement or otherwise to secure support	356
payments, and no foreclosure actions shall be taken on security	357
interests, mortgages or liens taken, granted, or charged against	358
principal residences of patients or residents or liable relatives	359
prior to October 7, 1977.	360

(D) The department shall make all investigations and	361
determinations required by this section within ninety days after a	362
patient or resident is admitted to an institution under the	363
department's control or a patient begins to receive state-operated	364
community mental health services, and immediately shall notify by	365
mail the persons liable of the amount to be charged.	366

(E) All actions to enforce the collection of payments agreed	367
upon or charged by the department shall be commenced within six	368
years after the date of default of an agreement to pay support	369
charges or the date such payment becomes delinquent. If a payment	370
is made pursuant to an agreement which is in default, a new	371
six-year period for actions to enforce the collection of payments	372
under such agreement shall be computed from the date of such	373
payment. For purposes of this division an agreement is in default	374
or a payment is delinquent if a payment is not made within thirty	375
days after it is incurred or a payment, pursuant to an agreement,	376
is not made within thirty days after the date specified for such	377
payment. In all actions to enforce the collection of payment for	378
the liability for support, every court of record shall receive	379
into evidence the proof of claim made by the state together with	380
all debts and credits, and it shall be prima-facie evidence of the	381
facts contained in it.	382

Section 2. That existing sections 1339.51, 5111.15, and	383
5121.04 of the Revised Code are hereby repealed.	384