Bill Text: IN HB1221 | 2011 | Regular Session | Amended
Bill Title: Life insurance and Medicaid.
Spectrum: Slight Partisan Bill (Republican 3-1)
Status: (Passed) 2011-05-16 - Effective 07/01/2011 [HB1221 Detail]
Download: Indiana-2011-HB1221-Amended.html
Citations Affected: IC 12-15.
Synopsis: Life insurance and Medicaid. Allows the state to use federal
or state Medicaid funds to pay life insurance premiums and expenses
for a Medicaid applicant or recipient who has irrevocably named the
state as the beneficiary of an in force life insurance policy or assigned
a life insurance policy to the state. Provides that life insurance proceeds
that exceed the amount of Medicaid benefits be paid to the beneficiary
of the recipient. Provides that the value of a life insurance policy
owned by an applicant or recipient may not be considered in
determining Medicaid eligibility if the applicant or recipient has
irrevocably named the state as the beneficiary or assigned the life
insurance policy to the state.
Effective: July 1, 2011.
January 12, 2011, read first time and referred to Committee on Public Health.
February 10, 2011, amended, reported _ Do Pass.
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(1) made an irrevocable election to name the state as a beneficiary of the life insurance policy for an amount that is not greater than the amount of Medicaid benefits provided to the recipient; or
(2) collaterally assigned the life insurance policy to the state under a written agreement submitted to and recorded by the issuing company of the life insurance policy.
(b) Any policy under which the state is named as an irrevocable beneficiary or that has been collaterally assigned to the state may not be sold, assigned, or the ownership transferred to any person or entity. This restriction exists as long as the policy names the
state as an irrevocable beneficiary or as long as the policy is
collaterally assigned to the state.
(c) Policy proceeds that exceed the amount of Medicaid benefits
provided to a recipient shall be paid to a beneficiary named by the
applicant or recipient.
(1) establishes one (1) irrevocable trust that has a value of not more than ten thousand dollars ($10,000), exclusive of interest, and is established for the sole purpose of providing money for the burial of the applicant or recipient;
(2) enters into an irrevocable prepaid funeral agreement having a value of not more than ten thousand dollars ($10,000); or
(3) owns a life insurance policy with a face value of not more than ten thousand dollars ($10,000) and with respect to which provision is made to pay not more than ten thousand dollars ($10,000) toward the applicant's or recipient's funeral expenses;
the value of the trust, prepaid funeral agreement, or life insurance policy may not be considered as a resource in determining the applicant's or recipient's eligibility for Medicaid.
(b) Subject to subsection (d), if an applicant for or a recipient of Medicaid establishes an irrevocable trust or escrow under IC 30-2-13, the entire value of the trust or escrow may not be considered as a resource in determining the applicant's or recipient's eligibility for Medicaid.
(c) Except as provided in IC 12-15-3-7, if an applicant for or a recipient of Medicaid owns resources described in subsection (a) and the total value of those resources is more than ten thousand dollars ($10,000), the value of those resources that is more than ten thousand dollars ($10,000) may be considered as a resource in determining the applicant's or recipient's eligibility for Medicaid.
(d) In order for a trust, an escrow, a life insurance policy, or a prepaid funeral agreement to be exempt as a resource in determining an applicant's or a recipient's eligibility for Medicaid under this section, the applicant or recipient must designate the office or the applicant's or recipient's estate to receive any remaining amounts after delivery of all services and merchandise under the contract as reimbursement for Medicaid assistance provided to the applicant or recipient after fifty-five (55) years of age. The office may receive funds under this subsection only to the extent permitted by 42 U.S.C. 1396p. The
computation of remaining amounts shall be made as of the date of
delivery of services and merchandise under the contract and must be
the excess, if any, derived from:
(1) growth in principal;
(2) accumulation and reinvestment of dividends;
(3) accumulation and reinvestment of interest; and
(4) accumulation and reinvestment of distributions;
on the applicant's or recipient's trust, escrow, life insurance policy, or
prepaid funeral agreement over and above the seller's current retail
price of all services, merchandise, and cash advance items set forth in
the applicant's or recipient's contract.
(1) the applicant or recipient is more than one thousand five hundred dollars ($1,500) for assistance to the aged, blind, or disabled; or
(2) the applicant or recipient and the applicant's or recipient's spouse is more than two thousand two hundred fifty dollars ($2,250) for medical assistance to the aged, blind, or disabled.
(b) In the case of an applicant who is an eligible individual, a Holocaust victim's settlement payment received by the applicant or the applicant's spouse may not be considered when calculating the total cash value of money, stock, bonds, and life insurance owned by the applicant or the applicant's spouse.
(c) In the case of an individual who:
(1) resides in a nursing facility or another medical institution; and
(2) has a spouse who does not reside in a nursing facility or another medical institution;
the total cash value of money, stock, bonds, and life insurance that may be owned by the couple to be eligible for the program is determined under IC 12-15-2-24.
the total cash value of money, stock, bonds, and life insurance owned
by the applicant or recipient to determine the recipient's eligibility for
Medicaid under section 1 of this chapter.
(b) However, a Holocaust victim's settlement payment received by
the parent of an applicant for or a recipient of assistance may not be
added to the total cash value of money, stock, bonds, and life insurance
owned by the applicant or recipient to determine the recipient's
eligibility for Medicaid under section 1 of this chapter.
(1) The face value of a life insurance policy.
(2) The cash value of a life insurance policy.
(b) The value of a life insurance policy owned by an applicant or a recipient may not be considered as a resource in determining the applicant's or recipient's eligibility for Medicaid if the applicant or recipient:
(1) makes an irrevocable election to name the state as a beneficiary of the life insurance policy for an amount that is not greater than the amount of Medicaid benefits provided to the recipient; or
(2) collaterally assigned the life insurance policy to the state under a written agreement submitted to and recorded by the issuing company of the life insurance policy.
(c) Any designation of the state as an irrevocable beneficiary or
any collateral assignment in favor of the state is void if the
application for Medicaid benefits is not approved.