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MEDICAL SERVICES POLICY MANUAL, SECTION E

E-530 Treatment of Resource Changes

It is required that burial funds be kept in an account separate from other non- excluded funds. Burial funds and other funds may not be commingled in the same account. Interest earned on excluded burial funds is excluded from income and resources, if left to accumulate and become a part of the burial fund. If burial funds are commingled with other non-burial funds, all of the funds will be counted as a resource, and no exclusion of burial funds will be allowed. When an applicant agrees to (and does) separate his commingled funds, eligibility may begin effective the date of entry into a facility, provided the individual’s total countable resources did not exceed $3500 ($2000 resources, $1500 cash for burial) on the first day of the month of entry and he is otherwise eligible. If any excluded funds, or accumulated interest, set aside for burial expenses are used for a purpose other than the burial arrangements of the individual or his spouse for whom the funds were set aside, the amount used will be considered unearned income in the month in which it was accessed, and a resource (to the extent retained) in the following month. The most common type of burial funds and burial arrangements are shown below, and must be considered in the order given in their application to the $1,500 burial exclusion. 1) Life Insurance Policies, other than those specifically designated for burial (See Item #3) - The total face value of all insurance policies on the life of an individual owned by the individual (or spouse) will reduce the $1500 burial exclusion if the cash surrender value of those policies was excluded in determining eligibility under the life insurance policy exclusion found under MS E-523 #2. If the total face value of policies considered here is $1500, no further exclusions are allowed.  NOTE:Life insurance policies with no cash surrender value will be totally disregarded as both resources and burial funds. 2) Irrevocable Contracts - Burial Association policies (membership through a funeral home) and some prepaid burial contracts (including those funded by deferred annuity and insurance policies) are considered irrevocable and are not treated as a resource, regardless of the value. Groups that issue prepaid burial contracts must have a permit to sell from the Arkansas Insurance Department,