Can You Transfer a Whole Life Insurance Policy and Still Get Medicaid?
Question:
Can the ownership of a whole life insurance policy be changed to make someone Medicaid eligible prior to the application being submitted?
Response:
No, the cash value of the policy is a countable asset and any transfer would cause a period of ineligibility for benefits based on that cash value. However, if there is a significant difference between the policy’s cash value and the death benefit, it can make sense to eliminate the cash value by borrowing against it and spending down the proceeds. Someone will still have to pay the premiums on the policy, but it may be worth the cost in order to reap the benefits upon the death of the insured.
Related Articles:
Handling a Whole Life Insurance Policy When Applying for Medicaid
Are Really Small Life Insurance Policies Non-countable for Medicaid Eligibility?
Are IRAs Countable Assets for Purposes of Medicaid Eligibility?
Will Transfer of Home & Rental Property Work Under Medicaid Rules?
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