Generally speaking, both Illinois and Missouri allow an exemption under Medicaid for prepaid funerals. However the rules are very technical and if you are going to purchase a prepaid funeral plan, you really should do that only under the direction and guidance of an experienced elder law attorney.
In this Elder Law Minute, Wes Coulson, Illinois Elder Law attorney, continues with the series What You Can and Can’t Keep with Medicaid and discusses prepaid funerals and explains the Medicaid rules concerning the exemption allowed in both Illinois and Missouri when applying for eligibility.
What you can and can’t keep with Medicaid: Prepaid Funerals
Hi, I’m Wes Coulson and this is your Elder Law Minute. This is another in our series on the Medicaid rules relating to what assets you can and cannot keep consistent with eligibility. Today I want to talk about prepaid funeral and burial or cremation plans.
I need to start with an important disclaimer and that is that what I’m going to say here is generally speaking. Each state has very technical rules and if you’re going to buy a prepaid funeral, you really should do that only under the direction and guidance of an experienced elder law attorney.
So, generally speaking, each state allows you to have a prepaid funeral. In Missouri, as an alternative to having $1500 worth of life insurance; in Illinois, in addition to that. A main requirement is that it needs to be irrevocable, which means it’s a done deal. What both states are particularly interested in they don’t want people to, for instance, buy a top of the line $25,000 funeral, have it counted as exempt, and then when the person dies say, “Okay, we’re going to change our mind down to a $2500 cremation plan and give us the rest of the money back.” So, they want to make sure that whatever you’ve chosen you’re actually spending the money on, not using it as a means to protect some money down the road.
But again, tricky stuff here, you need to confer with an elder law attorney. Thanks.
For more information on Medicaid and Asset Preservation, visit these articles:
- What you can and can’t keep with Medicaid: Asset Limits – Single or Widowed Applicants
- What you can and can’t keep with Medicaid: Asset Limits – Married Applicants and Community Spouse Resource Allowance
- Prepaid Funeral Arrangements: The Benefits of Pre-Planning
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