SENATOR Fingerhut

To amend sections 1339.51, 5111.15, and 5121.04 of the

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Revised Code relative to the creation of trusts to

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fund supplemental services for certain

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beneficiaries with physical or mental 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	5
Revised be amended to read as follows:	6

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

7

(1) "Ascertainable standard" includes a standard in a trust	8
instrument requiring the trustee to provide for the care, comfort,	9
maintenance, welfare, education, or general well-being of the	10
beneficiary.	11

(2) "Disability" means any substantial, medically	12
determinable impairment that can be expected to result in death or	13
that has lasted or can be expected to last for a continuous period	14
of at least twelve months, except that "disability" does not	15
include an impairment that is the result of abuse of alcohol or	16
drugs.	17

(3) "Political subdivision" and "state" have the same	18
meanings as in section 2744.01 of the Revised Code.	19

(4) "Supplemental services" means services specified by rule	20
of the department of mental health under section 5119.01 of the	21
Revised Code or the department of mental retardation and	22
developmental disabilities under section 5123.04 of the Revised	23
Code that are provided to an individual with a disability in	24
addition to services hethe individual is eligible to receive	25
under programs authorized by federal or state law.	26

(B) Any person may create a testamentary trust under this	27
section to provide funding for supplemental services for the	28
benefit of another individual who meets either of the following	29
conditions:	30

(1) The individual has a physical or mental disability and	31
is eligible to receive services through the department of mental	32
retardation and developmental disabilities or a county board of	33
mental retardation and developmental disabilities;	34

(2) The individual has a mental disability and is eligible	35
to receive services through the department of mental health or a	36
board of alcohol, drug addiction, and mental health services.	37

The trust may confer discretion upon the trustee and may	38
contain specific instructions or conditions governing the exercise	39
of the discretion.	40

(C) The general division of the court of common pleas and	41
the probate court of the county in which the beneficiary of a	42
trust authorized by division (B) of this section resides or is	43
confined have concurrent original jurisdiction to hear and	44
determine actions pertaining to the trust. In any action	45
pertaining to the trust in a court of common pleas or probate	46
court and in any appeal of the action, all of the following apply	47
to the trial or appellate court:	48

(1) The court shall render determinations consistent with	49
the testator's or other settlor's intent in creating the trust, as	50
evidenced by the terms of the trust instrument.	51

(2) The court may order the trustee to exercise discretion	52
that the trust instrument confers upon himthe trustee only if the	53
instrument contains specific instructions or conditions governing	54
the exercise of that discretion and the trustee has failed to	55
comply with the instructions or conditions. In issuing an order	56
pursuant to this division, the court shall require the trustee to	57
exercise histhe trustee's discretion only in accordance with the	58
instructions or conditions.	59

(3) The court may order the trustee to maintain the trust	60
and distribute assets in accordance with rules adopted by the	61
director of mental health under section 5119.01 of the Revised	62
Code or the director of mental retardation and developmental	63
disabilities under section 5123.04 of the Revised Code if the	64
trustee has failed to comply with such rules.	65

(D) To the extent permitted by federal law and subject to	66
the provisions of division (C)(2) of this section pertaining to	67
the enforcement of specific instructions or conditions governing a	68
trustee's discretion, a trust authorized by division (B) of this	69
section that confers discretion upon the trustee shall not be	70
considered an asset or resource of the beneficiary, histhe	71
beneficiary's estate, the settlor, or the testator'ssettlor's	72
estate and shall be exempt from the claims of creditors, political	73
subdivisions, the state, other governmental entities, and other	74
claimants against the beneficiary, histhe beneficiary's estate,	75
the settlor, or the testator'ssettlor's estate, including claims	76
based on provisions of Chapters 5111., 5121., or 5123. of the	77
Revised Code and claims sought to be satisfied by way of a civil	78
action, subrogation, execution, garnishment, attachment, judicial	79
sale, or other legal process, if all of the following apply:	80

(1) At the time the trust is created, the trust principal	81
does not exceed the maximum amount determined under division (E)	82
of this section;	83

(2) The trust instrument contains a statement of the	84
testator'ssettlor's intent, or otherwise clearly evidences his	85
the settlor's intent, that the beneficiary does not have authority	86
to compel the trustee under any circumstances to furnish the	87
beneficiary with minimal or other maintenance or support, to make	88
payments from the principal of the trust or from the income	89
derived from the principal, or to convert any portion of the	90
principal into cash, whether pursuant to an ascertainable standard	91
specified in the instrument or otherwise;	92

(3) The testator is deceased;

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(4) The trust instrument provides that trust assets can be	94
used only to provide supplemental services, as defined by rule of	95
the director of mental health under section 5119.01 of the Revised	96
Code or the director of mental retardation and developmental	97
disabilities under section 5123.04 of the Revised Code, to the	98
beneficiary;	99

(5)(4) The trust is maintained and assets are distributed in	100
accordance with rules adopted by the director of mental health	101
under section 5119.01 of the Revised Code or the director of	102
mental retardation and developmental disabilities under section	103
5123.04 of the Revised Code;	104

(6)(5) The trust instrument provides that on the death of	105
the beneficiary, a portion of the remaining assets of the trust,	106
which shall be not less than fifty per cent of such assets, will	107
be deposited to the credit of the services fund for individuals	108
with mental illness created by section 5119.17 of the Revised Code	109
or the services fund for individuals with mental retardation and	110
developmental disabilities created by section 5123.40 of the	111
Revised Code.	112

(E) In 1994, the trust principal maximum amount for a trust	113
created under this section shall be two hundred thousand dollars.	114
The maximum amount for a trust created under this section prior to	115
the effective date of this amendmentNovember11, 1994, may be	116
increased to two hundred thousand dollars.	117

In 1995, the maximum amount for a trust created under this	118
section shall be two hundred two thousand dollars. Each year	119
thereafter, the maximum amount shall be the prior year's amount	120
plus two thousand dollars.	121

(F) This section does not limit or otherwise affect the	122
creation, validity, interpretation, or effect of any trust that is	123
not created under this section.	124

(G) Once a trustee takes action on a trust created by a	125
settlor under this section and disburses trust funds on behalf of	126
the beneficiary of the trust, then the trust may not be terminated	127
or otherwise revoked by a particular event or otherwise without	128
payment into the services fund created pursuant to section 5119.17	129
or 5123.40 of the Revised Code of an amount that is equal to the	130
disbursements made on behalf of the beneficiary for medical care	131
by the state from the date the trust vests but that is not more	132
than fifty per cent of the trust corpus.	133

Sec. 5111.15.  If a recipient of medical assistance is the	134
beneficiary of a trust created pursuant to section 1339.51 of the	135
Revised Code, then, notwithstanding any contrary provision of this	136
chapter or of a rule adopted pursuant to this chapter, divisions	137
(C) and (D) of that section shall apply in determining the assets	138
or resources of the recipient, histhe recipient's estate, the	139
settlor, or the testator'ssettlor's estate and to claims arising	140
under this chapter against the recipient, histhe recipient's	141
estate, the settlor, or the testator'ssettlor's estate.	142

Sec. 5121.04.  (A) The department of mental health and the	143
department of mental retardation and developmental disabilities	144
shall investigate the financial condition of the patients in	145
hospitals and residents in institutions, residents whose care or	146
treatment is being paid for in a private facility or home under	147
the control of the department of mental retardation and	148
developmental disabilities, and of the relatives named in section	149
5121.06 of the Revised Code as liable for the support of such	150
patients or residents, in order to determine the ability of any	151
patient, resident, or such relatives to pay for the support of the	152
patient or resident and to provide suitable clothing as required	153
by the superintendent of the institution.	154

The department of mental health shall investigate the	155
financial condition of patients receiving state-operated community	156
mental health services and of the liable relatives to determine	157
the patient's or relative's ability to pay for the patient's	158
support. In all cases, in determining ability to pay and the	159
amount to be charged, due regard shall be had for others who may	160
be dependent for support upon such relatives or the estate of the	161
patient.	162

(B) The department shall follow the provisions of this	163
division in determining the ability to pay of a patient or	164
resident or the patient's or resident's liable relatives and the	165
amount to be charged such patient or resident or liable relatives.	166

(1) Subject to divisions (B)(10) and (11) of this section, a	167
patient or resident without dependents shall be liable for the	168
full applicable cost. A patient or resident without dependents	169
who has a gross annual income equal to or exceeding the sum of the	170
full applicable cost, plus fifty dollars per month, regardless of	171
the source of such income, shall pay currently the full amount of	172
the applicable cost; if the patient's or resident's gross annual	173
income is less than such sum, not more than fifty dollars per	174
month shall be kept for personal use by or on behalf of the	175
patient or resident, except as permitted in the state plan for	176
providing medical assistance under Title XIX of the "Social	177
Security Act," 49 Stat. 620 (1935), 42 U.S.C. 301, as amended, and	178
the balance shall be paid currently on the patient's or resident's	179
support. Subject to divisions (B)(10) and (11) of this section,	180
the estate of a patient or resident without dependents shall pay	181
currently any remaining difference between the applicable cost and	182
the amounts prescribed in this section, or shall execute an	183
agreement with the department for payment to be made at some	184
future date under terms suitable to the department. However, no	185
security interest, mortgage, or lien shall be taken, granted, or	186
charged against any principal residence of a patient or resident	187
without dependents under an agreement or otherwise to secure	188
support payments, and no foreclosure actions shall be taken on	189
security interests, mortgages, or liens taken, granted, or charged	190
against principal residences of patients or residents prior to	191
October 7, 1977.	192

(2) The ability to pay of a patient or resident with	193
dependents, or of a liable relative of a patient or resident	194
either with or without dependents, shall be determined in	195
accordance with the patient's, resident's, or liable relative's	196
income or other assets, the needs of others who are dependent on	197
such income and other assets for support, and, if applicable,	198
divisions (B)(10) and (11) of this section.	199

For the first thirty days of care and treatment of each	200
admission and for the first thirty days of care and treatment from	201
state-operated community mental health services, but in no event	202
for more than thirty days in any calendar year, the mentally ill	203
patient or mentally retarded resident with dependents or the	204
liable relative of a mentally ill patient or a mentally retarded	205
resident either with or without dependents shall be charged an	206
amount equal to the percentage of the average applicable cost	207
determined in accordance with the schedule of adjusted gross	208
annual income contained after this paragraph. After such first	209
thirty days of care and treatment, such mentally ill patient or	210
mentally retarded resident or such liable relative shall be	211
charged an amount equal to the percentage of a base support rate	212
of four dollars per day for mentally ill patients and mentally	213
retarded residents, as determined in accordance with the schedule	214
of gross annual income contained after this paragraph, or in	215
accordance with division (B)(5) of this section. Beginning	216
January 1, 1978, the department shall increase the base rate when	217
the consumer price index average is more than 4.0 for the	218
preceding calendar year by not more than the average for such	219
calendar year.	220

Footnote a. The patient or resident or relative shall	241
furnish a copy of the patient's, resident's, or relative's federal	242
income tax return as evidence of gross annual income.	243

Footnote b. The number of dependents includes the liable	244
relative but excludes the patient or resident in the hospital or	245
institution. "Dependent" includes any person who receives more	246
than half the person's support from the patient or the patient's	247
liable relative.	248

(3) A patient or resident or liable relative having medical,	249
funeral, or related expenses in excess of four per cent of the	250
adjusted gross annual income, which expenses were not covered by	251
insurance, may adjust such gross annual income by reducing the	252
adjusted gross annual income by the full amount of such expenses.	253
Proof of such expenses satisfactory to the department must be	254
furnished.	255

(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	259
fifty dollars per month;	260

(d) The services of a housekeeper, costing in excess of	261
fifty dollars per month, are required if the person who normally	262
keeps house for minor children is the patient or resident.	263

(5) If with respect to any patient or resident with	264
dependents there is chargeable under division (B)(2) of this	265
section less than fifty per cent of the applicable cost or, if the	266
base support rate was used, less than fifty per cent of the amount	267
determined by use of the base support rate, and if with respect to	268
such patient or resident there is a liable relative who has an	269
estate having a value in excess of fifteen thousand dollars or if	270
such patient or resident has a dependent and an estate having a	271
value in excess of fifteen thousand dollars, there shall be paid	272
with respect to such patient or resident a total of fifty per cent	273
of the applicable cost or the base support rate amount, as the	274
case may be, on a current basis or there shall be executed with	275
respect to such patient or resident an agreement with the	276
department for payment to be made at some future date under terms	277
suitable to the department.	278

(6) When a person has been a patient or resident for fifteen	279
years and the support charges for which a relative is liable have	280
been paid for the fifteen-year period, the liable relative shall	281
be relieved of any further support charges.	282

(7) The department shall accept voluntary payments from	283
patients or residents or liable relatives whose incomes are below	284
the minimum shown in the schedule set forth in this division. The	285
department also shall accept voluntary payments in excess of	286
required amounts from both liable and nonliable relatives.	287

(8) If a patient or resident is covered by an insurance	288
policy, or other contract that provides for payment of expenses	289
for care and treatment for mental illness or mental retardation at	290
or from an institution, facility (including a hospital or	291
community service unit under the jurisdiction of the department),	292
or state-operated community mental health service, the other	293
provisions of this section, except divisions (B)(8), (10), and	294
(11) of this section, and of section 5121.03 of the Revised Code	295
shall be suspended to the extent that such insurance policy or	296
other contract is in force, and such patient or resident shall be	297
charged the full amount of the applicable cost. Any insurance	298
carrier or other third party payor providing coverage for such	299
care and treatment shall pay for this support obligation in an	300
amount equal to the lesser of either the applicable cost or the	301
benefits provided under the policy or other contract. Whether or	302
not an insured, owner of, or other person having an interest in	303
such policy or other contract is liable for support payments under	304
other provisions of this chapter, the insured, policy owner, or	305
other person shall assign payment directly to the department of	306
all assignable benefits under the policy or other contract and	307
shall pay over to the department, within ten days of receipt, all	308
insurance or other benefits received as reimbursement or payment	309
for expenses incurred by the patient or resident or for any other	310
reason. If the insured, policy owner, or other person refuses to	311
assign such payment to the department or refuses to pay such	312
received reimbursements or payments over to the department within	313
ten days of receipt, the insured's, policy owners', or other	314
person's total liability for the services equals the applicable	315
statutory liability for payment for the services as determined	316
under other provisions of this chapter, plus the amounts payable	317
under the terms of the policy or other contract. In no event	318
shall this total liability exceed the full amount of the	319
applicable cost. Upon its request, the department is entitled to	320
a court order that compels the insured, owner of, or other person	321
having an interest in the policy or other contract to comply with	322
the assignment requirements of this division or that itself serves	323
as a legally sufficient assignment in compliance with such	324
requirements. Notwithstanding section 5122.31 of the Revised Code	325
and any other law relating to confidentiality of records, the	326
managing officer of the institution or facility where a person is	327
or has been a patient or resident, or the managing officer of the	328
state-operated community mental health services from which the	329
patient receives services, shall disclose pertinent medical	330
information concerning the patient or resident to the insurance	331
carrier or other third party payor in question, in order to effect	332
collection from the carrier or payor of the state's claim for care	333
and treatment under this division. For such disclosure, the	334
managing officer is not subject to any civil or criminal	335
liability.	336

(9) The rate to be charged for pre-admission care,	337
after-care, day-care, or routine consultation and treatment	338
services shall be based upon the ability of the patient or	339
resident or the patient's or resident's liable relatives to pay.	340
When it is determined by the department that a charge shall be	341
made, such charge shall be computed as provided in divisions	342
(B)(1) and (2) of this section.	343

(10) If a patient or resident with or without dependents is	344
the beneficiary of a trust created pursuant to section 1339.51 of	345
the Revised Code, then, notwithstanding any contrary provision of	346
this chapter or of a rule adopted pursuant to this chapter,	347
divisions (C) and (D) of that section shall apply in determining	348
the assets or resources of the patient or resident, the patient's	349
or resident's estate, the settlor, or the testator'ssettlor's	350
estate and to claims arising under this chapter against the	351
patient or resident, the patient's or resident's estate, the	352
settlor, or the testator'ssettlor's estate.	353

(11) If the department of mental retardation and	354
developmental disabilities waives the liability of an individual	355
and the individual's liable relatives pursuant to section 5123.194	356
of the Revised Code, the liability of the individual and relative	357
ceases in accordance with the waiver's terms.	358

(C) The department may enter into agreements with a patient	359
or resident or a liable relative for support payments to be made	360
in the future. However, no security interest, mortgage, or lien	361
shall be taken, granted, or charged against any principal family	362
residence of a patient or resident with dependents or a liable	363
relative under an agreement or otherwise to secure support	364
payments, and no foreclosure actions shall be taken on security	365
interests, mortgages or liens taken, granted, or charged against	366
principal residences of patients or residents or liable relatives	367
prior to October 7, 1977.	368

(D) The department shall make all investigations and	369
determinations required by this section within ninety days after a	370
patient or resident is admitted to an institution under the	371
department's control or a patient begins to receive state-operated	372
community mental health services, and immediately shall notify by	373
mail the persons liable of the amount to be charged.	374

(E) All actions to enforce the collection of payments agreed	375
upon or charged by the department shall be commenced within six	376
years after the date of default of an agreement to pay support	377
charges or the date such payment becomes delinquent. If a payment	378
is made pursuant to an agreement which is in default, a new	379
six-year period for actions to enforce the collection of payments	380
under such agreement shall be computed from the date of such	381
payment. For purposes of this division an agreement is in default	382
or a payment is delinquent if a payment is not made within thirty	383
days after it is incurred or a payment, pursuant to an agreement,	384
is not made within thirty days after the date specified for such	385
payment. In all actions to enforce the collection of payment for	386
the liability for support, every court of record shall receive	387
into evidence the proof of claim made by the state together with	388
all debts and credits, and it shall be prima-facie evidence of the	389
facts contained in it.	390

Section 2. That existing sections 1339.51, 5111.15, and	391
5121.04 of the Revised Code are hereby repealed.	392