Pending in the New Jersey legislature is a proposed law which would require Medicaid applicants to sell any life insurance policies they own and use the money toward nursing home care. Currently, New Jersey Medicaid applicants can keep term life insurance policies; they must cash in policies with a cash value.<\/p>\n
Life Settlements: How they Work<\/em> Savings to Medicaid<\/em> Seven other states have similar legislation pending. States are desperate to raise funds to pay for the care of the estimated 78 million Baby Boomers heading into old age. This trend will continue.<\/p>\n \u00a9\u00a0Law Offices of Robert J. Shanahan, Jr., LLC 2014<\/p>\n BE ADVISED that these comments are not legal opinions and are not to be relied upon as legal advice. If you need legal advice, contact your county bar association; most of which have referral services.<\/p>\n","protected":false},"excerpt":{"rendered":" Pending in the New Jersey legislature is a proposed law which would require Medicaid applicants to sell any life insurance policies they own and use the money toward nursing home care. Currently, New Jersey Medicaid applicants can keep term life insurance policies; they must cash […]<\/p>\n","protected":false},"author":5,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12,228,24,3007],"tags":[69],"_links":{"self":[{"href":"https:\/\/legalcounselnj.com\/wp-json\/wp\/v2\/posts\/1023"}],"collection":[{"href":"https:\/\/legalcounselnj.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/legalcounselnj.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/legalcounselnj.com\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/legalcounselnj.com\/wp-json\/wp\/v2\/comments?post=1023"}],"version-history":[{"count":0,"href":"https:\/\/legalcounselnj.com\/wp-json\/wp\/v2\/posts\/1023\/revisions"}],"wp:attachment":[{"href":"https:\/\/legalcounselnj.com\/wp-json\/wp\/v2\/media?parent=1023"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/legalcounselnj.com\/wp-json\/wp\/v2\/categories?post=1023"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/legalcounselnj.com\/wp-json\/wp\/v2\/tags?post=1023"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nSelling a life insurance policy, sometimes called a \u201cLife Settlement\u201d, involves transferring the policy to a third-party investor, who will continue to make the premium payments. The investor will receive the policy benefit upon the former owner\u2019s death. In exchange, the former owner will receive money up-front, but only at a fraction of the policy’s face value. The money received would be required to be spent on long term care only.<\/p>\n
\nIf passed, this law would save New Jersey a significant amount of money. Instead of cashing in a policy for its cash value, say, $5,000.00, a policy worth $100,000.00 would be sold for $45,000.00 and provide about five months of nursing home care. That\u2019s five months that would otherwise have been paid by Medicaid.<\/p>\n