Update on Irrevocable Funeral Trusts and Medicaid Eligibility

Earlier this year I wrote about problems that are cropping up for Medicaid applicants who purchased irrevocable funeral trusts. The problem is that certain County Boards of Social Services were/are counting some of the dollars in the irrevocable funeral trust as if they are available resources (assets). The theory was that the items are ‘for the living,” and not “for the funeral of the deceased.” The result is that a Medicaid applicant thinks he is eligible for MLTSS to pay for his nursing home care, but his application is rejected for “excess resources.”  This can cause catastrophic consequences, considering as the cost of a nursing home in New Jersey is at least $12,000 a month and the decision is received months after the expected date of eligibility, leaving the individual (and his spouse) exposed to enormous bills. Such a decision by a county welfare board creates a legal problem that requires adept legal representation to address.

Recently, one county advised us that the following items are “disallowed:”

  • Acknowledgement cards- $10
  • Crucifix- $25
  • Flower Car- $350
  • Gratuity- $30
  •  Limo- $425
  •  Register Book- $25
  • Specially:  Prayer Cards- $50

When you are setting up an irrevocable prepaid funeral trust, discuss these details with the funeral director and try to obtain current guidance from the funeral director or an elder law attorney regarding what will or won’t cause a “Medicaid eligibility problem.” The State issued a policy memorandum, but it does NOT inform the public of what the consequence is of making a mistake of this sort. This is an example of the numerous legal traps that are embedded within the MLTSS program and aren’t always obvious on the surface to people who are filing applications. Although appeals are possible (Medicaid Fair Hearings), it would be preferable if people could know in advance exactly what the rules are so they can plan accordingly.

Call for advice on NJ Medicaid eligibility, applications & appeals …..732-382-6070

Unsure about VA Burial? Now You Can Inquire in Advance.

Setting up meaningful funeral and burial arrangements is an important component of estate planning and end of life planning.  Many veterans are unsure about whether they or their family members are entitled to burial in a VA Cemetery.  Family members may not realize that  VA burial is a possibility and may miss an opportunity despite the fact that service in the military was very important to the identity of the decedent.  Now, the VA is taking steps to let everyone figure out what burial services are available to veterans and their families well before death.

Eligible individuals are entitled to all of the following: burial in any open VA national cemetery, opening/closing of the grave, a grave liner, perpetual care of the gravesite, and a government-furnished headstone or marker or niche cover, all at no cost to the family. Veterans are also eligible for a burial flag and may be eligible for a Presidential Memorial Certificate.  It’s important to know if your loved one is eligible for this before making alternate arrangements for a private funeral that may otherwise not be needed.

It certainly can be emotionally difficult to tackle the task of making pre-arrangements. However,  pre-planning and pre-funding a funeral will be helpful to the surviving family members who will be struggling with their grief.  In fact, if a person requires nursing home care and will be applying for Medicaid, they can fully pre-fund an irrevocable funeral trust, and the value of that trust will be an exempt asset that won’t preclude eligibility. So whether one seeks to have a VA burial, or one privately paid, these arrangements should be fully explored and planned in advance whenever possible.

Call us about estate planning for veterans and non-veterans alike … 732-382-6070