Can missouir medicaid take a life insurance policy?

Can missouir medicaid take a life insurance policy?

Postby jaryn » Tue Apr 26, 2011 12:50 pm

my cousin has a life insurance policy with a death benefit of $10,000 and a cash value of a little over $6000. She owns the policy and is on Medicaid due to being a dialysis patient. She has been on Medicaid for over 10 yrs. Medicaid is telling her she has to buy a pre paid burial policy or turn the policy over to a funeral home. I am the beneficiary on this policy..What can I do to protect her death benefit to bury her when she is gone? Can she transfer ownership to me? She has until May 16th only to resolve this issue.
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Can missouir medicaid take a life insurance policy?

Postby dowle95 » Tue Apr 26, 2011 12:53 pm

You are past the time limit to transfer ownership, which is 5 years prior to your cousin going on Medicaid. This regulation is to keep people from doing just that to get out of paying back the state.

Medicaid is not saying you cannot bury her - that is why they're suggesting to buy a pre paid burial policy which is safe from Medicare liens.
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Can missouir medicaid take a life insurance policy?

Postby cearbhallan » Tue Apr 26, 2011 12:55 pm

medicaid is correct and they will pay for the burial expenses up to a certain point....if you do anything fishy you will be subject to fraud...be very careful, they look for these type of frauds....when she signed on to medicaid she gave up most of her rights regarding assets....especially 6k worth of assets..
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Can missouir medicaid take a life insurance policy?

Postby aisford38 » Tue Apr 26, 2011 12:56 pm

Ask if you can take a loan against the policy. With the money you can pay for pre-paid funeral expenses. The difference will be paid to you when your cousin passes.
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Can missouir medicaid take a life insurance policy?

Postby eliott81 » Tue Apr 26, 2011 12:57 pm

Nope! You're out of it. The state will allow so much for a modest funeral, the rest is theirs.
I suggest you talk this over with a funeral establishment.
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Can missouir medicaid take a life insurance policy?

Postby erhardt80 » Tue Apr 26, 2011 12:59 pm

They, Missouri Medicaid, must not have been aware of that asset. If a policy has a cash value greater than $1500, it is considered a countable asset Had they been aware of it she would not have qualified for Medicaid. She is fortunate that they are not taking punitive measures.

I am thinking that what they are allowing her to do is not exactly to turn the policy over to a funeral home but instead to establish a an Irrevocable Funeral Trust (perhaps through a funeral home). Current laws allow persons on Medicaid to retain assets for a proper funeral. Unfortunately, these amounts are usually woefully inadequate. However, a life policy used with an Irrevocable Funeral Trust allows for a lump sum deposit of $15,000 per individual. At passing, funds are paid to the funeral home of her choice. Using this technique, the family should have sufficient funds to pay for the funeral of the deceased. These funds are not subject to the spend-down process. Or they are requiring her to surrender the policy and use the cash value to fund a prepaid burial policy.

You can be sure that she will be required to make some changes. Seeking advice from an expert on elder law might be useful here.
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Can missouir medicaid take a life insurance policy?

Postby colton35 » Tue Apr 26, 2011 1:01 pm

You want to get your hands on her death money, so you can keep it, and make everyone ELSE in the state pay for her medical care? Sounds very greedy.

They've told you what to do to resolve it - if you're NOT being greedy, you would be perfectly satisfied with her cashing out and buying the prepaid funeral with her money - that's the option they offered. If you don't like it, it makes you look very, very greedy.
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