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Does Medicare Cover Final Expense Insurance?

Medicare is a great option for health care and has been helping people for decades. Today, this amazing program has helped close to 60 million older adults, and people with disabilities get the health care coverage they need. However, Medicare wasn’t designed to cover everything; especially things that are not considered medical expenses, such as final expense insurance.

Medicare Medical Savings Account

As mentioned, Medicare doesn’t consider final expense insurance, a medical expense. As such, it does not offer coverage for funeral or burial costs in the event of a Medicare beneficiary’s death. However, there is a Medicare Advantage plan that is referred to as a Medicare Medical Savings Account, or, an MSA account. Keep in mind, the design of the MSA is to pay for a Medicare beneficiary’s medical expenses and does not include final expense insurance. However, depending on when the funds were placed into your account, some of that money goes to your designated beneficiary after you pass.

If you chose to participate and you enrolled in a medical savings account plan, you could request to your beneficiary, that upon your death, and after all your medical expenses have been paid, that you want them to take any remaining cash, and use it towards your funeral expenses.

What is Final Expense Insurance?

Not everyone knows that final expense insurance is actually a form of life insurance. Final expense insurance was created to eliminate the financial costs associated with passing away. If the policy was in place before a policyholder passed away, the policy issues a guaranteed death benefit payable to a beneficiary chosen beforehand. The death benefit could even be left to a favorite foundation of the policyholder’s as well.

In addition to paying for final expense costs such as the cost associated with the funeral, and burial, the death benefit can also be used to cover cremations, credit card debt, outstanding medical bills, and other end-of-life expenses.

Every state is different when it comes to insurance. However, generally, people from the ages of 50 to 85 years are able to purchase final expense insurance. Again, some states might set the max age at 80 years old.

Like a life insurance policy, final expense insurance is also available in term and permanent coverages with a minimum of $5,000, and a maximum of $50,000 in some states.

Benefits of A Final Expense Policy

There are many benefits to having final expense insurance. The main reason why most people tend to purchase final expense insurance is to not leave their loved ones, or spouses, in financial turmoil after the policyholder’s death.

Another popular reason is that some people would like to leave something behind for their loved ones, especially if they have children or elderly parents for whom they take care of. A final expense policy can alleviate the concerns a policyholder has about leaving enough assets behind for their loved ones to maintain their lifestyle after they’ve passed away.

Deciding on purchasing final expense insurance, or choosing to reject this coverage, should not be taken lightly. And, if a person does decide to purchase this coverage, it is recommended to make sure all open debt is considered once they are trying to determine the amount of coverage needed.

Can Social Security Help Out at All with Final Expense?

The short answer to this question is yes. However, coverage is limited. If final expense insurance is just not an option, some people turn to the government to see if Social Security offers any assistance. Some states have different rules, but if you qualify for supplemental security income, the Social Security office might allow for the person to set aside a specific amount of money that they can use towards funeral expenses.

Reporting a Medicare Beneficiary’s Death

If a family member or a friend (who was a Medicare beneficiary) has passed away, you can report their death directly to Medicare. This is done by contacting the United States Social Security office at one 800-772-1213. If you are a TTY user, please call the Social Security office at 800-325-0778.

To learn more about enrolling in Medicare, contact the professionals at (844) 374-1950. Our licensed insurance experts will be happy to answer any questions you have.