Settlement Trusts

Protecting and preserving settlement funds

Why Protect Funds?

When people receive settlements, the money can often dissipate quickly. Business deals appear interesting, big purchases seem affordable, friendly loans look harmless. People often feel they can afford to be generous and experimental. All too often, however, this results in the settlement being depleted, leaving them with insufficient funds and unable to work or provide for their family.

Assura: The Settlement Trust Experts

Many trust companies work with conventional trust clients and seldom serve settlement beneficiaries. Assura Trust is different: we focus specifically on serving people who are settling personal injury claims. This allows us to deliver a higher level of service to our clients—one that produces more finely-tuned, comprehensive, and innovative support.

We also operate with a more personal and flexible style of service than you will typically experience at large national banks or local community bank trust departments. Assura Trust is an office of Midwest Trust Company, a Kansas-based firm with assets exceeding $13 billion. Headquartered in Denver, we work with consultants across the country to serve you quickly and comprehensively.


What is a Settlement Management Trust?
A Settlement Management Trust (SMT) is a protected account designed to hold, manage and distribute money received from a personal injury settlement. Its primary purpose is to protect and preserve the funds for the exclusive benefit of the person being compensated—the trust “beneficiary”—according to his/her needs. Trusts such as our Settlement Management Trusts are proven legal arrangements which place a part of the settlement proceeds safely within the care of a fiduciary whose job is to conserve the funds for the beneficiary only.

Using a trust as a component of a settlement ensures that the beneficiary has money for needs well into the future. At Assura Trust, we bring financial expertise and familiarity with the situation to a wide range of specialized services that deliver the kind of help money alone cannot provide.

We recommend Settlement Management Trusts in situations where future expenses are anticipated, but timing may be uncertain—such as with medical procedures, counseling, some educational needs, welfare, and support—and thus fall outside the spectrum of fixed, periodic payments. We also recommend them in situations where lack of future funds would make life particularly difficult, such as when full recovery is unclear, or when beneficiaries face new challenges like finding employment. Minimum Funding: $100,000


What is a Special Needs Trust?
A Special Needs Trust is a tool to maximize all benefit sources available to a severely injured party at the time of settlement of a personal injury claim. This is accomplished by preserving the plaintiff’s eligibility for Medicaid and Supplemental Security Income (SSI) by segregating the settlement proceeds into a trust for medical and non-support elements of care not covered by these Government programs. Settlement proceeds such as structured settlement annuities and the Growth Structured Settlement may be established to pay into the Special Needs Trust to help add asset diversification and tax savings.

Funding requirements for Special Needs Trusts are generally $500,000; however, exceptions may be granted. Please contact the Assura Team to discuss.

Third-Party vs. First-Party Special Needs Trust

Money owned by someone other than the SNT Beneficiary. Examples:
— Parents leave an inheritance to Child’s SNT.
— Grandma’s will provides testamentary trust for grandson with special needs.

  • Does not require Medicaid reimbursement.
  • Grantor chooses remainder beneficiaries.
  • May benefit people other than the Beneficiary with a disability.
  • Irrevocable.

Money owned by the SNT Beneficiary. Examples:
— Inheritance to special needs beneficiary’s personal name.
— Proceeds from a personal injury lawsuit.

  • Also called a “d4a” Trust because authorizing language found in 42 U.S.C. 1396p (d)(4)(a).
  • Requires reimbursement (or “payback provision”) to state Medicaid agency which expended funds on behalf of SNT Beneficiary during their lifetime.
  • Must “primarily benefit” the SNT Beneficiary.
  • Can be created by the individual, a parent, a grandparent, a Guardian or a Court.
  • Must be “disabled” (as determined by the SSA) as of the date the SSA reviews the SNT.
  • Beneficiary can contribute to their SNT up to age 65.
  • Irrevocable.


Courts across the country recognize the necessity to protect funds for children and incapacitated adults and often recommend trusts. Trusts are especially helpful to beneficiaries in cases involving children and incapacitated adults because they eliminate the need for continuing court supervision over expenditures, which is usually required if a guardianship of the estate is established. This greatly simplifies the process for a beneficiary.

Trusts for minors may be designed to simply hold funds until they reach the age of majority, or they might permit expenditures sooner for such things as tutoring or educational opportunities. After beneficiaries reach the age of majority, trusts can help protect assets from business disputes, divorce, or creditor claims. Minimum Funding: $100,000


A Medicare Set-Aside (MSA) is an interest-bearing account, such as a trust account, which is either professionally administered or self-administered, that holds the funds to pay for future medical and drug expenses that would otherwise have been covered by Medicare.

Centers for Medicare and Medicaid Services (CMS) recommends that parties to a settlement set aside funds, known as Medicare Set-Aside Arrangements for all future medical and/or prescription drug services related to a Worker’s Compensation injury or illness/disease that would otherwise be reimbursable by Medicare. In essence, the MSA effectively acts as “primary coverage” for injury-related treatment post-settlement. Once the funds are properly depleted, Medicare becomes the primary payor. Minimum Funding: $100,000


For individuals who have recurring medical needs, a Medical Care Trust is a personalized trust for beneficiaries needing medical services tailored to their unique needs while maintaining flexibility for potential procedures, counseling, physical therapy, and other recurring healthcare costs throughout their lives. The Assura Team can also work with beneficiaries’ doctors, nurses, caregivers, and others to help coordinate the beneficiaries’ various services in order to best meet their needs. Minimum Funding: $100,000