Medicaid Policy
Medicaid Policy
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An individual can designate as a burial fund more than the available burial fund exclusion or more than the maximum burial fund exclusion of $1500. (592-5) The excluded and non-excluded portions of the designated burial funds can be commingled because they are burial related assets.
Ratio of excluded to non excluded burial funds
You must establish the ratio of the excluded amount to the total value of burial funds. This ratio will determine the excluded portion of any interest paid on or appreciation in value of the excluded portion of the burial fund. (See #2 below)
Determine this ratio by dividing the value of the excluded portion of the burial fund by the total value of the fund. Carry the quotient to three places.
Determine the ratio of excluded burial funds to total burial funds as of the date the individual first commingled excluded and non-excluded funds. This date could be:
The date the individual designated and separated the total burial fund from non-burial related assets.
The date the individual designated additional burial funds and this increased the total to more than the burial fund exclusion amount (592-7).
The date the individual purchased another burial related asset such as an irrevocable pre-need funeral contract (592-7) and the purchase reduced the amount of the exclusion, or
The date the individual uses the burial funds for another purpose and reduces the remaining burial funds (not including interest or appreciation) below the amount originally designated (592-9).
Excluded appreciation of or interest paid on excluded and non-excluded portions of burial funds
Exclude from resource the amount of interest paid on or appreciation in value of the excluded portion of the fund, if left to accumulate, even if the interest causes the total of the excluded burial funds to exceed $1500.
To find the amount of interest paid on the excluded portion of burial funds when non-excluded and excluded burial funds are commingled:
Determine the total interest paid on the commingled account, then
Multiply the total amount of interest paid on the account by the ratio of excluded funds to total value of the burial funds.
The result is the amount of interest paid on the excluded portion of the fund.
The amount of interest paid on the non-excluded portion of the burial fund may count as income (415-7). It also counts as a resource if left to accumulate.
To calculate the amount of interest paid on the non-excluded portion of commingled excluded and non-excluded burial funds, subtract the excluded interest from the total interest earned on the account.