MIL absolutely will not go into VA if it means the state will get her house. Any advice?

Some states permit the house to go to a family caregiver and still qualify for Medicaid, but GA is correct. In my state the family caregiver has to live there and provide care for a period of two years prior to the house being exempt from Medicaid Recovery. that means his legal address would become your mom's, tax returns, driver's license, voting records, banks, etc. Requirements vary by state, some do not permit it. Check with an elder law attorney that specializes in Medicaid planning.

Is the insurance company still planning to repair the house?

I'm far from knowledgeable about Medicaid but I do recall reading that there is an exemption for someone living in the house and caring for the elder. But that would mean, I believe, that your son would have to live there and take care of her for the requisite amount of time (2 years, I think).

Hopefully someone more knowledgeable can address the exemption and time requirement.

I certainly understand the issue on change!

Thanks. That's pretty much what I thought, but I kept hearing about an exemption, so thought I'd ask about it. Figured it was worth a try if it could convince her the house would be safe. She's had it for 60 yrs and wants to pass it to her son (my husband). She's worked her whole life as a single mom, is a veteran from WW II, and VERY independent. At 92, change doesn't come easy.

Yes, she can keep the house while on Medicaid. But, Medicaid will file leins against the house to collect what they have paid for her care when the house is sold.