My grandmother who is in the nursing home son died and he had a large insurance policy with no beneficiary listed. Attorney said it would go to next of kin which is his mother instead of his siblings. What does Medicare do with all the money and can we request a itemized list of what 80,000.00 is being spent on; also we are still paying for my grandmother private room at the nursing home.
If your question is about Medicaid, your question shows us how Estate Planning and Probate law overlaps with the laws and regulations that govern Public Benefits like Medicaid.
If the gentleman who passed away had no will, and there is no beneficiary listed on the insurance policy, the life insurance money passes to the person(s) listed in your state's "intestacy" law. That's the Probate law that the attorney explained to you.
If your grandmother is the "next of kin," the Public Benefits laws and regulations decide how much money she can have in the bank when Medicaid decides whether it will pay for her nursing home care. The lesson for most of us reading this is the need for everyone in our families to plan ahead, so that we won't leave problems for our survivors.
It sounds like the son could have done some planning to protect your grandmother. But there are many things you can still do now, to make sure the life insurance money benefits your grandmother, and does not disqualify her from receiving Medicaid nursing home coverage. Talk to an elder law attorney who understands your grandmother's needs and circumstances, and ask about pooled trusts in your state that are administered by charities.
Your attorney is probably right. If there are no spouse or children, the mother would be the logical choice for next of kin.
Medicare is not affected by the inheritance. Although for 2016, some with higher income (about 30%) will see a premium increase from $105 to $155 mo.
The life insurance is 80K? That's maybe a year of private pay @ NH.