How do I tell my brother that mom's insurance money has to be gone before she can sign up for Medicaid?

Since you've wisely seen an attorney, I'd go one more step and ask the attorney to tell your brother how it has to be. This is perfectly normal. Life insurance with cash value is considered an asset and must be spent down like other assets before one can expect the government to foot the nursing home bill. He needs to understand that many if not most of us have seen our "inheritance" used this way. It's the price of our elders living longer, and sometimes, sicker.
It would be nice if he were more understanding and listen to you, but it sounds like you need the backup of an attorney.
Take care,
Carol

I agree with all of the answers. I am a retired attorney and held family conferences frequently, and included absent siblings via a tel con. Above all, let your brother know sooner rather than later. It will give him time to adjust his unrealistic expectations! Best wishes to you in a difficult situation.

I agree with Carol and there is no getting out of this one when it comes to the money issue and help from the government. Either he accepts it or moves on without it. You are doing what is best for your mother. Why does the sibling concern him or herself with what money they will inherit when a parent passes? Is that the only interest they have and not the welfare of the parent? Geesh I hear alot of these stories on here and it is sad. My father has nothing and I tend to him. Even if he did have anything I would do what is right for him and not think about what is in it for me when he passes. Money can sometimes be the root of all evils with families. Sad but true. Best of wishes to you and yes I would contact the attorney as Carol has suggested here. Thank God you have one!

A note to readers in general ... my understanding is that life insurance policies are only "counted" as an asset if the Medicaid applicant is the "owner of record" of the policy. My parents set up my Dad's life insurance policy with my mother (rather than himself) as the owner. When my mother died, I inherited her policy on Dad's life as the new owner. I, not my father, make all the annual payments on this policy. I have been advised by a Medicaid attorney that because my father is not the owner of the policy, it can not be counted as an asset if/when the time comes to apply for Medicaid.

Be sure, when you asked on an application whether your parent "has a life insurance policy," that you know who the owner of any such policy is ... the fact that a policy insures the life of your parent does not mean that your parent is the policy owner of record (though that is likely to be the case by default unless your parent deliberately set things up differently).

Ownership of a life insurance policy can be transferred (by the original owner), but I assume there are all the same penalty/lookback periods related to such a transfer as for other kinds of gifts, so this is probably useless information for those of you with parents nearing the time of applying for Medicaid. Still, I mention it to those who are nowhere near that time, because it may be worth sitting down with a parent who is still healthy and talking about the best way to set up a policy in the first place (or to transfer an existing policy if the parent is amenable and the beneficiary is in a position to take over making the annual payments).

In my case, it's not a lot of money, but knowing that we'll get it back in the end will make it easier for my husband and me financially to "front" funds for whatever my Dad needs above and beyond what Medicaid supplies if/when the time comes that he has to apply.

I think Carol's idea that the lawyer should explain it to your brother (for a fee, of course -- lawyers don't use their time without charging) is best in this case. Prettymom, your brother is being foolish. That money was never his to count on. Mom could have at any time decided to cash that policy in. I have told my kids/stepkids that I have insurance that will go to them equally if I happen to die before cashing it in, but that I expect I will use it myself in my retirement, especially if I have medical needs. It is too bad your brother has this sense of entitlement, but as Carol says, few people who live a long life will leave much for family to inherit.

Your brother's attitude is Not Your Fault. You mother's need is Not Your Fault. You have nothing to feel bad about and certainly nothing to feel guilty about. It is what it is. Let the lawyer explain it to Brother. (And maybe he will take it more maturely than you expect. Little brother do grow up, you know!)

PaulaK, you make a very good point, and it is definitely something for all of us to be aware of. Since Prettymom has seen a lawyer, the ownership of the policy no doubt has been looked at. But your information is valuable for the rest of us!