New York State Funeral Directors Association

It was the judgment of Congress that persons should not have to choose between lifesaving welfare assistance and giving up their plan for the disposition of their bodily remains. A 1982 amendment to the Social Security Act implemented a program whereby Medicaid/SSI eligible persons can set aside funds for their funeral and burial before their resources are exhausted by medical bills or their income declines to such a level that they need the cash assistance provided by the Supplemental Security Income (SSI) program. This program was implemented through specific resource exclusions for prepaid funeral contracts.

Medicaid/SSI: Advantages for Eligible Individuals

All citizens – regardless of income – are entitled to and deserving of both a proper funeral service and a burial with dignity and respect. In fact, federal and state laws support this guiding principle in a number of important ways.

First, any person applying for Medicaid/SSI can set aside funds for the sole purpose of paying their funeral/burial expenses as part of the spend-down process to Medicaid/SSI eligibility. The funeral/burial funds you set aside will not be counted as part of your financial resources. As of January 1, 2011, New York State law also mandates that all contracts for prefunded funerals for family members executed by applicants for or recipients of Medicaid also be irrevocable.

Second, New York State law requires that 100% of these funeral/burial funds be placed in an irrevocable trust account making certain that they will be available when they are needed and used for no other purpose than what they are intended. A trust which is titled “irrevocable” means that any refund, withdrawal or other disposition of the deposits on account plus accrued interest, for any purpose, will and must legally be refused by the funeral director and/or funeral trust or financial institution. Please note: If the account is irrevocable and there is an overage after the final funeral charges have been paid, the overage will be paid to the county where the beneficiary resided and was receiving assistance.

Finally, you have the right to use any funeral home you choose. You may also change your funeral home selection, at any time, for any reason.

Note: A Medicaid/SSI eligible individual must first notify his or her caseworker that funds will be set aside to pay their funeral/burial expenses.

FUNERAL PLANNING INFO