The life insurance policy is for the amount of 60,000. My deceased sister left her this money through her life insurance policy. I don't want it to affect my mother's Medicaid. So I don't know if it would be wise to forfeit the claim and let it go to the other beneficiaries or claim it and see what options she may have that will not affect her Medicaid and SSI benefits, if there are any? She left her this money so that she could be taken care of, but unfortunately it is causing more harm than help. Please advise as to what options there are available.
FYI: She resides with me full time in the state of Florida I am also one of her POA as well as my other sister.
Thus, it would be better for her to accept the money and immediately convert it to something not countable, e.g., a Medicaid annuity, prepaid funeral and burial, household items, new car, etc. I give a lot of these suggestions in my Medicaid Secrets book (by the way, the 2015 edition is just out. www.MedicaidSecrets.com).
However in Florida, if countable assets are disposed of in manner that does not impose a Medicaid eligibility penalty in the same month they are received, it is quite possible that no penalty will ensue.
Otherwise, for each month your mother is over the asset limit of $2,000, she will not be eligible for benefits.
In addition to the other suggestions provided, there may be other options to preserve the proceeds for your mother's benefit while she is receiving Medicaid.
Consider a Personal Service Contract between you and she. The value of the contract can be paid in lump sum to you without penalty (may be a taxable event).
Also consider using a Supplemental Needs Pooled Trust. Transferring funds to this existing irrevocable trust sponsored by 501c3 organizations allow her to maintain Medicaid eligibility while having access to the funds transferred for almost anything related to her health, maintenance, and welfare while receiving benefits.
Does she own a home with a mortgage that can be paid down?
I encourage you to explore all the options available to preserve the cash for her use while she is receiving Medicaid benefits.
I, too, am paying down my mother's money for her care. It's not my money, it's her money.
Taxpayers should not have to foot the entire bill for our elders, especially if people have money to pay for their medical care. I'd suggest you spend it down on your mother (it's her money).
I hired a Medicaid consultant along with an Elder Care Attorney. I am thankful Medicaid is available to help me and my mother. Think about what would happen if it weren't available.
I've also kept up her Medicare and BC/BS to help her get the best care she can while in the facility.
My will goes into a trust for the designated beneficiaries that is set up for care of my wife. Upon her death the trust will be covered by our wills and go to the heirs.
See and discuss this with a qualified elder affairs attorney. Never rely of posted advice.
I found grist of this disclaimer on TechByter Worldwide. {adapted for my postings}
Regarding my posts: I participate and post for informational purposes only. I assume no responsibility for accuracy. Any actions you take based on my posting information are entirely at your own risk. Products and services are mentioned for informational purposes only and their various trademarks and service marks are the property of their respective owners. I am independent; I collect information from various Internet sources share it thru Dave M. Knowledge Network
See All Answers