Estate Plan Guidance for ALS Patients and Families
An ALS diagnosis changes life quickly. Families face decisions about medical care, financial affairs, and future costs. The urgency to act is real.
Most people know Lou Gehrig’s disease is a progressive disease, but few realize how fast expenses grow. Long term care, life sustaining treatments, and health insurance coverage can reshape a family’s entire financial plan. The cost of mechanical ventilation, feeding tubes, or clinical trials often reaches six figures. That reality makes setting up a trust for ALS patients a crucial step. It protects assets, directs financial decisions, and gives loved ones a clear process to follow.
An estate plan with a trust works hand in hand with documents like a living will, power of attorney, or healthcare proxy. These legal tools guide medical decisions when the patient is unable to act. They also protect eligibility for Medicare, Medicaid, and financial aid programs that pay for treatments and reduce burden. With the right attorney, financial planner, and medical team, ALS patients can build resources that speak for them and support family members long after the disease progresses.
Steps in Setting Up a Trust for ALS Patients
Step 1. Build your team: attorney, financial planner, medical team
Start with an attorney or lawyer experienced in trusts and special needs planning. Add a financial planner who knows disability benefits and long term care costs. Ask the medical team to outline likely treatments and timelines so the estate plan matches real care needs.
Bring: ALS diagnosis notes, list of assets, life insurance policy details, health insurance information, family contact list.
Cost guide: a lawyer-drafted revocable living trust often runs about $1,500 to $2,500 depending on complexity. Special needs language adds work and cost.
Why this matters: Medicare can start right away with ALS, and SSDI timing is accelerated by law. Planning early lets the trust coordinate with benefits.
Step 2. Choose the right trust structure
Most people compare three options. Revocable living trust for control while the disease is early. Irrevocable trust for protection and defined rules. Special needs trust to keep Medicaid and SSI eligibility while holding assets for the patient’s benefit.
What to ask the attorney: will a 1917(d)(4)(A) special needs trust or a pooled trust under 1917(d)(4)(C) protect Medicaid while paying for medical care and daily support.
Key rule of thumb: the Social Security Administration recognizes these exceptions when drafted correctly.
Step 3. Name decision-makers for money and health
Pick a trustee you trust, whether a close friend, family member, or professional. Name backups. Appoint a durable power of attorney for financial decisions, and a healthcare proxy or medical power of attorney for healthcare decisions.
Quick distinction to explain to family: the durable power handles money and legal acts. The healthcare proxy handles medical decisions when the person is unable to decide. Different documents. Different roles.
Documents to draft now: power of attorney, healthcare proxy, living will. Use plain language about life sustaining treatments like mechanical ventilation and feeding tubes so the medical team can act on the patient’s wishes.
Step 4. Fund the trust so it can actually pay for care
Retitle assets to the trust as the attorney instructs. Typical funding includes checking and investment accounts, property, and a life insurance policy. Update beneficiary designations so payouts line up with the plan.
Option that adds liquidity: a viatical settlement lets eligible ALS patients sell a life insurance policy for a large lump sum cash payment that helps pay medical care, long term care, or home modifications. Funds can go into the trust for managed disbursement.
Example: a policy with remaining premiums becomes cash today so the trustee can cover ventilation equipment, paid caregivers, and transportation without waiting for a claim.
Step 5. Coordinate benefits: Medicare, Medicaid, SSDI, health insurance
ALS patients do not face the usual 24-month Medicare wait. Coverage ties to SSDI entitlement, which is expedited for ALS, and recent law removed the five-month SSDI wait period for ALS applicants. This speeds access to doctors, clinical trials, and durable medical equipment.
Action list: keep private health insurance active where it helps. Confirm what Medicare will cover. Ask the financial planner to check Medicaid eligibility rules in your state if long term care is expected. Use the trust or a special needs trust to protect eligibility while paying approved expenses.
Step 6. Put care choices in writing with clarity
Use the living will and healthcare proxy to record preferences about mechanical ventilation, feeding tubes, and other treatments. The medical team needs clear instructions so the plan matches the person’s wishes when ALS progresses.
Reality check for planning: long ventilation in ICU is costly, often thousands of dollars per day. Families plan better when documents address how to pay and who decides.
Step 7. Add complementary tools and set review points
Create a short binder or shared digital folder. Include the trust, powers of attorney, healthcare proxy, insurance cards, and contact information for the trustee and medical team. Schedule reviews at diagnosis milestones or big cost changes.
Helpful complement: consider an ABLE account if eligible, which can work alongside a special needs trust to handle qualified disability expenses without breaking benefits. Families often use both.
Community resource: your local ALS Association chapter can point to care services and benefits guidance.
Trust Options to Include in an ALS Estate Plan
ALS patients and their family members often hear about “trusts” but may not know how they differ. Below is a side-by-side look at the main trust types used in an estate plan when dealing with a progressive disease like Lou Gehrig’s disease.
| Trust Type | When It Helps ALS Patients | Key Benefit for Financial Affairs & Medical Care |
| Revocable Living Trust | Early after an ALS diagnosis, when the patient still has decision-making ability and wants flexibility. | Patients keep control of assets and can adjust the plan as medical decisions, expenses, or family needs change. |
| Irrevocable Trust | When protecting assets from creditors or planning for Medicaid eligibility in long term care settings. | Locks assets outside the estate, which may reduce the burden of costs and protect access to Medicaid. |
| Special Needs Trust | For ALS patients who want to qualify for Medicaid or Supplemental Security Income while still holding resources. | Preserves government benefits while allowing funds to cover expenses Medicare or health insurance will not cover. |
Potential Challenges, Costs, and Time Required for ALS Patients
Ongoing legal costs that add up
A revocable trust can cost $1,500–$3,000 to draft. A special needs trust that complies with Medicaid rules can run closer to $5,000–$7,000 once the lawyer accounts for government benefit language. Annual reviews as ALS progresses often add $200–$400 per hour for updates. Families end up paying not just once, but again and again.
Time lost in appointments
Setting up a trust requires multiple meetings. An attorney meeting often takes two hours. A financial planner may need two or three sessions to map long term care costs. The medical team needs at least one dedicated consultation to discuss mechanical ventilation, feeding tubes, and clinical trials. In practice, families spend 20–30 hours across several weeks just coordinating information before the first draft is ready.
Funding the trust with assets is not automatic
Banks require in-person visits to retitle accounts. Insurance companies demand notarized forms to move a life insurance policy into the trust. Property transfers often mean filing deeds with county offices, which carry $50–$200 filing fees and long wait times. Each step delays when the trust can actually start paying expenses.
The trustee’s role is heavy
Once the trust is active, a trustee, often a close friend or family member, handles ongoing financial decisions. That means paying bills, managing health insurance coverage, and submitting claims. For ALS patients with complex medical care, the work can take 10–15 hours a month, every month, for years.
Emotional labor in healthcare decisions
Documents like a healthcare proxy and medical power guide choices, but they don’t remove the responsibility. Family members may still face decisions about long term care, life sustaining treatments, or participation in clinical trials. These conversations can take place at hospital bedsides, at midnight, when loved ones are already drained.
There is another option.
Using Viatical Settlements to Fund a Trust
Trusts provide structure, but many ALS patients need immediate financial support to make them work. A viatical settlement offers that option. By selling a life insurance policy, ALS patients can receive a lump sum of cash today, instead of waiting until the policy pays out. That money can then flow directly into the trust to cover care and support loved ones.
Case in point: An ALS patient with a $250,000 life insurance policy may qualify for a viatical settlement worth up to 70% of the policy value. That means possibly $175,000 available right now. Instead of worrying about how to pay for a feeding tube, mechanical ventilation, or in-home nursing, the trustee has immediate funds to act.
Ways viatical funds support the trust:
- Cover medical care and treatments: pay out-of-pocket costs for clinical trials, mobility devices, or home modifications.
- Relieve financial burden on family members: free up cash so loved ones are not draining savings or retirement accounts.
- Strengthen long term care planning: set aside resources in the trust that can handle monthly expenses for years, not just emergencies.
With this approach, the trust becomes more than a legal shell. It becomes a funded tool that supports healthcare decisions, pays expenses, and protects family members as ALS progresses. American Life Fund specializes in viatical settlements for ALS patients, giving families a clear point of contact when they need cash quickly.
Check out our eligibility criteria.
Final Steps in Setting Up a Trust for ALS Patients
By this point, the trust is funded and active. The last part of setting up is making sure the people, documents, and benefits all line up. These are not afterthoughts, they are part of the setup process itself.
Assign roles with clarity
A trustee manages the money, a durable power of attorney covers financial decisions, and a healthcare proxy handles medical decisions. Setting these roles now prevents conflicts when ALS progresses and the patient is unable to act.
Align the estate plan with medical documents
A living will, medical power of attorney, and healthcare proxy should all match the trust’s instructions. The medical team needs consistency to follow the patient’s wishes on life sustaining treatments such as mechanical ventilation or feeding tubes.
Confirm benefit protection
For ALS patients who rely on Medicare, Medicaid, or private health insurance, the trust must be drafted carefully. A special needs trust or pooled trust ensures that financial aid and coverage remain intact while still paying for uncovered expenses.
Schedule regular reviews
ALS is a progressive disease. Treatments change, costs rise, and family needs shift. Reviewing the trust with an attorney and financial planner each year is part of completing the setup, not just ongoing maintenance.
Ready to see if your life insurance policy can work today?
Contact American Life Fund to explore whether you qualify for a viatical settlement that can help fund your trust, lighten financial burden, and protect your family’s future:
- Phone: (877) 261-0632
- Email: info@americanlifefund.com
- Mailing Address: 3295 River Exchange Dr #350, Norcross, GA 30092
