Repayment of death benefits. Must this money be surrendered to the state?

As long as the beneficiary is an individual or entity that is not the Medicaid recipient the death benefits are not subject to Medicaid Estate Recovery.

No, beneficiaries of insurance are not pursued by MERP.

Money from an insurance policy is the
beneficiaries. They do not have to use it for the insurers bills. I had a friend who had a $100,000 insurance policy with her daughter as beneficiary. My friend assumed her funeral expenses would be paid out of it. The daughter chose not to do it. The stepfather had to pay. I think u don't pay taxes on the money is some states.

I think the dollar amount is key. $1500 should be fine and you should be able to keep it. Larger amounts would have had to cashed in before Medicaid would have been approved. Since this is an Union benefit, I do not think it was eligible to be cashed in anyway.

Insurance or pension death benefits are not subject to withholding by anyone other than to the beneficiary. I am sorry for your loss.

As mentioned here, no. It really wouldn't make any sense to name someone beneficiary if they're going to have to turn right back around and lose the money, think about it

Does this also apply to term life insurance?

If you're the named beneficiary, I don't see wherein lies the problem.

millerteresa - Larger amounts really doesn't have any bearing in my understanding. If the money could be considered an asset for Medicaid, they wouldn't care if it was $100, they'd take it! But, that is if there is a "cash value" to the insurance, as in a Whole Life policy. It depends on whether the type of policy has that cash value or not... My Mom had policies with a cash value and I had to cash those in and "spend down" (sorry, dumb!) so she could get on Medicaid.