Can I Transfer Life Insurance to Help Qualify for Medicaid?
The discussion about the affect of life insurance on a Medicaid application has a lot to do with money. It is true that most of the Medicaid application process has to do with money, but the rules regarding life insurance are a little more straightforward than other assets. There are a lot of questions people have about applying for Medicaid which makes hiring an elder law professional a necessity during the application process. With help on your side, you can be better prepared for some of the surprises the application process brings.
Term Life Insurance
Term life insurance is a type of life insurance with an expiration date on it and has no cash value. Since term life insurance does not have any cash value, it has no effect on your Medicaid application. You can keep your term life insurance policy in effect and keep your beneficiary on your policy.
Whole Life Insurance
A whole life insurance policy has a cash value and an investment portion that make the policy an asset to the policy holder. This is an asset that could delay your Medicaid approval and have an effect on your benefit award. It is important that this policy be protected from Medicaid. The Mattar Firm specializes in just that.
What Can I do?
The Mattar Firm has strategic ways to protect your assets under the law. In most states, using the money to buy a funeral plot and pay for final arrangements qualifies as an exempt expense.
Life Insurance Payouts
The death benefit on a life insurance policy is normally not considered an asset of the Medicaid applicant’s estate. However, the potential payout from the investment portion of a whole life policy is considered an asset and can delay approval of Medicaid benefits.
When it comes to applying for Medicaid, you should never try to do it on your own. The Mattar Firm legal staff has many years of experience in handling non-crisis and crisis Medicaid application processes. We invite you to give our helpful Medcaid planning lawyers a call before you apply for Medicaid to make sure that you are making the right decisions and doing the right things with your income and assets.