Upon retirement the military member may elect coverage in the Survivors Benefit Plan (SBP). This coverage can be for a spouse only, spouse and children, or children only coverage.
When Joe retired we discovered that we couldn't elect this coverage for Kayla and have it designated to go to a special needs trust. The law stated it could only be designed to a person and the Defense Department's interpretation of person did not include a trust.
As parents we want to provide for our childrens' future as best we can and not having this option to designate the payments of the SBP to go to a special needs trust for Kayla was frustrating. We could still chose to designate Kayla as a beneficiary if we wanted to, but we would have to be very careful with how much could be allotted to her - any monthly payment she would receive could potentially affect her eligibility for government benefits programs such as Medicaid, SSI, and housing programs.
Individuals with disabilities can not have more than $2000 in assets before it affects their eligibility for those programs. I've often been frustrated by the constrictions on all of this. Isn't the goal to help Kayla be as independent as possible? How independent can you be if you're restricted to $2000 in assets? If we're able to help provide for her future so she doesn't have to rely on all of those government benefits is that really such a bad thing? I don't think it is, but it's unnerving to think if we do something as simple as designating her as a beneficiary we could be jeopardizing her chance at programs she may truly need and could benefit from.
Around the time of Joe's retirement I read there was legislation being introduced, or had been introduced, to allow military members to designate SBP payments to a special needs trust, but when it came time to sign that paperwork there was no law in affect. The person at the office where we had to fill out the SBP paperwork hadn't heard anything about it.
Joe signed the paperwork for his SBP elections in November. In March I read an article (New Law Eases Burden for Special Needs Military Kids) that the President had indeed signed The Disabled Military Child Protection Act (I wish they would use People-First Language like The Military Child With Disabilities Act) which would allow the military member to have the SBP be paid to a special needs trust. This was signed in December (it figures!).
Hopefully the Defense Finance and Accountability Service will consider having an 'open season' for retired service members to allow them to elect the SBP for a trust.