Does the nursing home get dad's life insurance policy? or does the family get it?

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My father is terminal and was given 6 months. He has a life insurance policy but has been placed in the nursing home, will they become the beneficary of the policy? We live in Texas

Answers 1 to 10 of 28
What arrangement was made when he entered the NH? What is in the contract? Is he self-pay or on Medicaid?

This is not related to his insurance, but if he is not on Hospice care I highly recommend it.
He isn't on hospice yet. What is your thought on this?
I suggest you have him evaluated for hospice and enroll him as soon as he is eligible. It is a very comforting, helpful program for both the patient and the family. My husband was on hospice about five weeks before he died, and I am certainly grateful for their help. They will provide help right in the nursing home where your father is.
My understanding was that third parties could not make a claim on a life insurance policy directly. If you are in a penalty situation where you could be liable for some bills due to gifting or for other reasons are in debt, you might end up using some of the payout but that would not be something the nursing home could directly claim. If in doubt, an eldercare attorney is often the best resource and option. I found a good one in Arkansas by picking the one with the website that explained the Medicaid issues that we were going to be dealing with the best. The consultation was about $300.00 and very much worth it.
The beneficiary listed on the life insurance policy receives the money.

Texas requires that any life insurance policy can't have a face value of more than $1500. before a person is eligible for Medicaid. Had my FIL lived longer and needed to apply for Medicaid we would have had to cash in his whole life policy for its cash-in value and apply that money towards his care.
To clarify, I should have written "death value". Texas Medicaid laws don't allow you to have a life insurance policy with a death value of more than $1,500. to be eligible for Medicaid. A policy with a death value of $1,500 or less is an exempt asset.
In PA it was "face value" and we had to cash in a couple smaller policies that had actual cash value to qualify for my Dad.
Thank You I believe we will be bringing him home next week and calling in Hospice. Thanks for all your answers and concerns. Please pray for us and the strength to face what is ahead. Thanks!!
RRcc - None of this is easy. Hospice is a wonderful resource and if you can make it work within your family and everybody understands what "comfort" care is.

Insurance is sticky for being an asset. There are issues in whole vs term and in ownership. Most elderly are on the policy as being the owner of the policy so it is an asset. BUT you DO NOT have to own your policy, others can own the policy and this is how you get around it being an asset, you just need a good financial advisor & attorney to get this worked out. I have "key-man" insurance policy and the business technically is the owner of my life insurance policy and pays the premiums. Did this years ago before I even had to think about dealing with Medicaid issues for my mom. Now whole life policies usually build up a cash value and have to be cashed in before Medicaid can happen. Term policies don't and are POD to whomever is the beneficiary. I have heard that some states are requiring the Medicaid recepient to have the Medicaid program be a beneficiary but I bet this will face legal challenges.

Regarding hospice, if you haven't chosen the hospice group, one thing to consider is if they have a end-of-life hospice facility. My MIL was in the panhandle and her hospice was at a freestanding hospice facility adjacent to the hospital. She went there after being in a NH and was there about 2 weeks before she died. For my mom, we have preselected VITAS for her hospice when her MD decides it is time. Vitas has a free-standing facility where she lives in central TX, and again, if need be she can be transferred there for the final, final, final days. If your dad might be one who needs serious class 3 or 4 pain medications (like opiates), an in unit hospice facility will work better as the go-to-your home hospice staff usually don't carry the big time pain drugs on them. Just something to think and ask about.
Great question. If your father is on Medicaid, the state can most likely take the life insurance policy pay-out during the asset recovery phase (after the parent passes away). Medicaid can take all of the proceeds except for what may be used for funeral, burial, and estate settlement expenses. The state of Kansas said they were even entitled to receive my father's VA life insurance benefit. (Shocking!) The VA says the state can't touch it. Still don't have an answer, yet we continue to pay the premiums. Because my father is on Medicaid and Hospice, and he had the $10k policy upon admission, again, we the unpaid caregivers are forced to hire an attorney to sort these details out. Don't know how being under Hospice care can over-rule whatever your state;s Medicaid mandates. Can an attorney please chime in here? Thanks again for posting this very important question. Good luck to all of you and your families.

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