Pittsburgh attorney sets up 'opioid trusts' for beneficiaries with addiction issues

Aug. 12--Attorney Martin Hagan specializes in estate planning and has answered questions about nearly all aspects of setting up wills, trusts and similar legal documents.

But four years ago, he got a question he hadn't anticipated.

"I had clients with a child who had a substance abuse disorder, and they were basically asking me, 'What do I do in this situation?'" said Hagan, a partner at Meyer Unkovic & Scott, a Downtown Pittsburgh law firm.

The American Family Survey, commissioned annually by the Deseret News and conducted by YouGov, found that 12 percent of families in 2017 reported having an opioid-addicted relative. Nationally, opioid overdoses are now the leading cause of death for people under 50, the Centers for Disease Control and Prevention reported last year.

As the opioid epidemic continues to impact Pennsylvanians and people nationwide, families are in constant search of answers as to how they can help loved ones with addiction issues.

That has led attorneys like Hagan to get creative and establish a sort of "opioid trust."

"People were saying, 'I don't want to leave anything outright to this child because of what I've heard can happen to the money,'" Hagan said. "So what do you do?"

Estate-planning attorneys regularly establish trust funds for beneficiaries with intellectual disabilities, who are entitled to public-health benefits through Social Security or Medicaid and receive supplemental trust payments that add to those.

"An opioid trust is a completely different issue," Hagan said. "I usually start by asking parents what they're currently doing for their child -- Are they giving them money? Are they paying for basic support needs? Is that money going to buy drugs? Have you cut them completely off?"

All about recovery

At a recent estate-planning conference in Harrisburg, Hagan spoke with a substance abuse psychologist.

"It was very instructive for me," Hagan said. "He basically said the trust should never provide any kind of support to the child. I know that sounds cruel, and it can worry parents ... but the way this doctor expressed it is that the name of the game is recovery. The goal is to get that person into recovery and, through trial and error, eventually they might be able to stay clean long-term."

With that in mind, an "opioid trust" is set up to pay recovery-related expenses: rehabilitation bills, therapist payments and treatment bills.

"You want a person to go out and get a job," Hagan said. "It's the kind of tough-love aspect that this psychiatrist said is the only way this type of trust will be beneficial."

The cardinal rule, Hagan said, is that money is never distributed directly to the beneficiary, nor is any property that could be easily converted into drug money.

"You provide other, in-kind benefits," he said. "Maybe you give them the use of a car, but not the title to that car."

Choosing a trustee

Another challenge in these situations is choosing a trustee.

"Another sibling or family member can be a bad situation because even if they have a good relationship with the addict, things can get very hostile," Hagan said. "You can go with the bank, but bankers are not geared toward dealing with addicts, and they'll quickly grow tired of the harassing phone calls and antisocial behavior you're subjected to sometimes."

Enter Pittsburgh-based Achieva. Founded in 1951, it has grown to include a number of services and organizations -- including The Arc of Westmoreland.

Its Achieva Family Trust does standard trust disbursements but also has a team of social workers and counselors, "and they get hands-on involved working with trust beneficiaries," Hagan said. "They can do the same thing for a child with substance abuse disorder."

Hagan estimates he's set up about a half-dozen "opioid trusts" in each of the past four years.

"It's becoming more prevalent now," he said. "And it's not a condition that's limited to the urban or rural poor. Addiction comes out of middle- and upper-class communities, too -- it's an equal-opportunity drug."

Occasionally, Hagan encounters parents who "are in a fair amount of denial about the seriousness of this," but more often than not are just looking for answers.

"You have a couple in their 60s or 70s, they have children and want to provide for them, and they're coming up short in terms of what they can do," he said.

Patrick Varine is a Tribune-Review staff writer. You can contact Patrick at 724-850-2862, pvarine@tribweb.com or via Twitter @MurrysvilleStar.

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