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We have to put my Mother in a nursing home.

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Is she private paying or on Medicaid?
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Sorry, you actually answered that question. Nevermind.
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Igloo572, wow, thank you for this information. I am the beneficiary of her life insurance policy. Does that mean the policy is safe?
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The answer to the question is NO, the nursing home can not take possession of your mother's insurance policy. If other factors apply, you did not address them.
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Christine - most states allow a separate funeral & burial fund under 2K. And most allow a NCV (no cash value) funeral /burial policy under 10K. About the policy that you are paying for....who is the beneficiary? Is it you or moms estate? If its you, then it will not matter for medicaid or MERP. If its moms estate, then the $ is used for the funeral & burial and those types of death expenses are almost always a Class 1 or a Priority expense of moms estate and payable before any MERP recovery.

So your probably good on this.

Have you priced funerals? Easily 8K. Average is like 10K. If funds are limited you may need to do a cremation as it can be done under 2K. My mom (on NH Medicaid) had a traditional preneed done & my folks had bought a mausoleum in early 1980's & a seperate small funeral floral set aside and none where an issue for medicaid & all reported. If you can & when your in a pit bull mood, visit a FH to get an idea on what the options are now & before you are dealing with emotion.

Btw if you get a cremation done, there are companies that turn the ashes (human or pet) into diamonds which can become jewelry. Really truly mom can become a brooch.
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Make sure you prepay her funeral or cremation. Medicaid will allow her to have an irrevokable funeral trust. Anyone going on medicaid should do this before all the money is spent down. That way funeral costs are covered.
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My mother is in a NH, on Medicaid, and still has her life insurance policy. It is a low face value policy with cash value of about $1500. I disclosed this to the nursing home when she entered a year ago and so far nothing has happened. I am having her premiums paid out of my checking account. I hope there's no rude awakening when she dies. I'm counting on that money to help bury her.
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Nursing home cannot "take" anything. If she is on Medicaid, then likely Medicaid would claim such assets to satisfy what they have paid out,

Grace + Peace,
Bob
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Babalou has asked whether mom is going in on Medicaid which should answer the question. She is right that all assets with the exception of her home, one car and $2,000.00 must be used for her care. Any cash value of the policy must be used to pay the nursing home. If there is a house there is the potential for it to provide her income from rent. The car provide her transportation. Medicaid as they go through the qualification process will request mom's financial records to determine if there were gifts to anybody during the past five years, this includes monetary and property gifts. Everything that has been sold must be for fair market value. If it has not been mom will be charged a penalty where Medicaid will not pay for a period of time that is determined on the value of any gifts. This is a dollar for dollar penalty period. If the cost of the nursing home is $10,000.00 a month and they find she has sold her house worth $100,000.00 for $50,000.00 her penalty would be $50,000.00 to anybody, including family, so five months that mom's care would have to be paid another way. The program is called MERP, Medicaid Estate Recovery Program. An attorney that specializes in Medicaid planning may be able to make recommendations on how to preserve some of Mom's assets.
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Is she on Medicaid? Can she qualify if she does a "pay down"? In that case, Medicaid allows prepayment for funeral expenses to come out of any assets before they are assigned to the NH. If she is not on Medicaid and can't be on it, I think Babalou's suggestion of working through an elder care attorney is your best option.
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I think the answer to that question hinges on whether your mom is paying out of pocket for the nh, or if she is going to be relying upon Medicaid. Medicaid, not the NH will require that all of mom's assets be used for her care. Life insurance policies that have cash value ("whole life") generally have to be cashed in. You should really discuss this with a certified elder care attorney.
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