Can Mom use her whole life insurance cash value to pay for her funeral expense ahead before entering Medicaid which will be about 2 mos?


My Mom had a stroke leaving her paralyzed on left side She is now in a NH under medicare and 2nd insurance . She has about 2 mths left and she will have to go on Medicaid. I realize they will take everything she has as a asset, but I heard she could cash her face value in on her insurance to pay for her funeral expenses ahead of time . She has already paid for the grave site and closing of it many yrs ago. There is only two small policy with a cash value of about 3 thousand and 9 thousand on the other. Can this be used for her casket and funeral arrangements.

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Yes and the funeral home could likely take care of all of this for you. Now you do need to make sure that whatever the funeral & burial policies are NO CASH VALUE. They will need to be an irrevocable policy - has to be NCV so that no issues with Medicaid. The state will have a limit on what the funeral policy can be too. So you need to make sure it is under that limit. Most states have this at 10K so see what they can do to totally take care of everything with just the 9K policy.

About the rest of the spend-down, you might want to have a long conversation with the social worker regarding that specific items your mom may need if she stays paralyzed. The usual clothing she has may not be suitable for her, so if you can spend down some funds getting her a wardrobe that will work better for what her physical limitations will be, the better. My mom fell and shattered her hip in June and now is totally bedfast. Almost all of her wardrobe was pants & blouses and lots of short vests and short jackets and pj's. And now all totally unsuitable for someone who is bed bound. Well at least now I don;t have to go an buy another pair of those hideous SAS shoes she so loves! So I have gone and had to buy lots of short "dusters" and "sleep shirts" so that she is covered but they are short enough for quick / easy access for nursing staff and for her to put on after bathing. So if you can spend some funds towards stuff like this, it will be a good thing and be less worry later on. Also I ordered some extra oversized & cute terry bibs with velcro for them to use when she eats. Now hospice ordered some too, but the more the better as they can be jettisoned when they get too stained. Please laundry mark all the clothing too.

Also extra eyeglasses are a good spend down as they do go amiss.

Sometimes you can take out the cash value in the policy but still keep the policy in effect, so look into if this is something allowed with her policy.

If she needs any update to her legal and is cognitive to do this, that too is an acceptable spend-down. This is all a lot to do and it can seem overwhelming. You want to start to get her items together for the Medicaid application too. Good luck and keep a sense of humor in all this….
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Yes she can prepay..medicaid allows it.
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