Exempts individual retirement accounts as a countable resource for public assistance. This act also prohibits the state as a creditor against an ABLE account in the event of death of a beneficiary.

What This Bill Does

This Rhode Island bill makes two related changes to how the state handles certain financial accounts when people apply for public assistance programs. First, it would prevent the state from counting Individual Retirement Accounts (IRAs) — savings accounts people set up to save money for retirement — as a financial resource when determining whether someone qualifies for public assistance benefits. Currently, having money saved in an IRA could potentially disqualify someone or reduce their benefits, even though that money is meant for retirement, not everyday expenses.

The Second Change: ABLE Accounts

The bill also addresses ABLE accounts, which are special tax-advantaged savings accounts designed specifically for people with disabilities. These accounts allow people with disabilities and their families to save money for disability-related expenses without losing eligibility for government benefits. Under this bill, if an ABLE account holder passes away, the state of Rhode Island would not be allowed to claim money from that account to pay back Medicaid or other public assistance costs — a practice sometimes called "estate recovery."

Who Is Affected

This bill would affect two main groups: low-income Rhode Islanders who have IRAs and are applying for public assistance programs, and Rhode Islanders with disabilities who hold ABLE accounts. For the first group, it means retirement savings wouldn't work against them when seeking help. For the second group and their families, it provides greater financial security by ensuring that money saved in an ABLE account can be passed on after death rather than claimed by the state. The bill has been referred to the Senate Finance Committee for further review.