How do I secure my grandmother's life insurance policy before putting her in a nursing home or living assistant program? - AgingCare.com

How do I secure my grandmother's life insurance policy before putting her in a nursing home or living assistant program?

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She has Masshealth and Medicare coverage. We live in Massachusetts, and I'm afraid that the state may go after these policies. She is 90 and has paid for these policies for many years. How do I protect policies?

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momsno1 I agree. I just have to get in touch with them. The whole thing sounded bazaar to me and my sister. My mother bought the life insurance to pay for her funeral, so there really won't be a lot leftover, but I will be checking with a lawyer, too. Thanks, for the heads up.
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No followup from original poster of this question?
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bushels, I believe you've been given incorrect information about what you can do with leftover money. I recommend you run this by an elder law attorney.
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When my mother was in a nursing home for one month and paying it herself (she is now in assisted living) the administrator told me that my mothers' whole life policy would be taken by Medicaid when the time comes that she runs out of money and goes into the nursing home.I was pretty surprised as I thought life insurance was off limits. Wrong. The funeral home told me that we could use the policy to prepay her funeral (not sure how they do this, I assumed they become the owner, but I haven't checked yet). There will be money left over, and I asked what happens to that, and she said we (her children) could use it for our own funeral expenses (prepaid), as Medicaid will take it if we don't. I have dragged my feet as mom is still in the assisted living, and will be there for awhile, but she is almost 94. I only checked with one funeral home, so I will be calling around to see if they were correct, also calling the insurance co. to see if I can make them the owner.
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dianerankkin,
Regarding your original question: If by chance her life insurance contract(s) were used to fund a trust, and if the trust was established longer than 60 months ago, it would not be an asset that Medicaid could touch. Medicaid has a 5 year look-back, as you may already know, so if she had a trust established at least 5 years ago, that's not a countable asset.

However, I would advise that you consult with an Elder Care attorney to address your specific situation, in order to determine assets that Medicaid would count.
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I think we've got two different threads going here. The original question was how to protect life insurance from Medicaid. Now we're talking about using life insurance to enhance your life before you die. Good thoughts, but not pertinent to original question.
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I think we've got two different threads going here. The original question was how to protect life insurance policies from Medicaid. Now we're talking about how best to use a policy to benefit a person before he dies. Good thoughts, but not pertinent to the original question.
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When I worked with an HIV nonprofit in the 1990s, some of the people with AIDS sold their life insurance policies for some fair amounts. Then they would use the money to live and pay for care. The purchaser received the death benefit when the person died. It worked well if there was no beneficiary who would need the death benefit.
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I heard that you can claim that your relative, either mother or grandmother etc, and state they are in their last days and will not live much longer. They will release some of the funds. I found that out to late. They don't advertise this. I had 300,000 and could not keep up the payments. Shortly after I heard a commercial that you could sell the life insurance for an amount agreed upon by you and the Ins company. Also, they will release certain amounts to help pay for their care. I am SICK that I did not see the add re selling the policy. Take action people, don't do like I did.
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michelleshevlin, good luck getting the insurance company to make the funeral home the owner of the insurance policy. We were dealing with AIG and CUNA and neither would do it.
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