New York State Funeral Directors Association

Q: What happens if I currently have a revocable preneed account, but I am now applying for Medicaid or SSI?
A: When applying for Medicaid/SSI, your caseworker should advise you that the revocable preneed account must be converted to irrevocable status to ensure that your program eligibility is not jeopardized.

Q:How does my life insurance policy affect my Medicaid eligibility?
A: The face value of any life insurance policy(ies) over $1,500 will be counted as an asset in determining your Medicaid eligibility.

Q: Can additional funds be added to my irrevocable preneed account?
A: Yes. However, the total deposits into the account must not exceed the total cost of funeral merchandise and services recorded on the original itemization statement.

Q: Can an overage in an irrevocable preneed trust account be used to fund additional services or merchandise?
A: No. If the current account balance exceeds the actual costs of the services and merchandise originally selected, the overage must be returned to the county.

Q: Can my irrevocable preneed agreement be modified at the time of need?
A: Yes. However, the new items must be of equal or lesser value, and must qualify as funeral merchandise and services. If there is an overage, the funds may not be depleted to cover additional merchandise and services, but must be sent to the county.

Q: Which county Social Services Department receives the overage in an irrevocable trust account?
A: If there’s an overage after the final funeral charges have been paid, the overage must be sent to the county where the recipient was receiving public assistance at their time of death (in most cases this will be the county where the decedent resided).

Q: Can an irrevocable preneed funeral account be split into separate accounts in New York State?
A: No. The full amount of an irrevocable preneed agreement must be placed into a single preneed trust account.

Q: Which items may not be included on the preneed itemization form for an irrevocable preneed account?
A: As an applicant or recipient of Medicaid/SSI, you may only prearrange “reasonable and common” funeral merchandise and service expenses that are related to fulfilling the funeral contract. Examples of items not permitted by the NYS Bureau of Funeral Directing include: airline tickets, funeral luncheons, charitable donations, and cash gifts. If there are any questionable items, you should speak to a social worker to obtain prior approval.

Q: Who may authorize a transfer of funds to another funeral home?
A: Before death occurs, only the purchaser and his/her legal representative may authorize a transfer of an irrevocable preneed account to another funeral home.

Q: How does the law affect pre-existing contracts of Medicaid applicants and recipients?
A: If you had both a pre-existing agreement and were receiving benefits prior to January 1, 1997, your account may remain revocable, but must still be recertified annually by County Social Services personnel.

Q: Must a funeral firm’s print materials include a disclosure relating to preneed agreements?
A: Yes. Any promotional material printed must contain language disclosing the irrevocable nature of preneed funeral and burial accounts established by and for individuals receiving or applying for Medicaid or SSI.