Losing a loved one is extremely difficult—and the average cost of a funeral is high. Losing a loved one and not being able to pay for funeral expenses is devastating. What happens when a loved one dies and there’s not enough money in the estate to pay for the funeral?
Jump ahead to these sections:
- Medicaid Funeral and Death Benefits
- Irrevocable Funeral Trusts and Medicaid
- How to Access Medicaid’s Funeral Assistance
Some would assume that Medicaid would help pay for funeral expenses. In actuality, Medicaid does not always cover final costs. States administer the Medicaid program, and some states have programs to help pay for funeral expenses while others do not. This doesn’t mean you have no other programs to turn to for help.
Read on to learn about paying for a funeral when funds are low.
Tip: If you're planning a virtual funeral with a service like GatheringUs, you may still be able to put Medicaid funeral benefits to use. Whether the funeral is in-person or virtual, many of the points below still apply, especially with regard to burial and cremation.
Medicaid Funeral and Death Benefits
Medicaid is a government insurance program. It provides medical coverage for people of all ages who do not have enough resources to pay for health care. Qualifying for Medicaid does not guarantee that the federal government will cover any of your funeral expenses.
Medicaid resources are administered by the states. Since state government programs tend to vary when the leadership changes, it’s difficult to have a complete list of states that offer funeral assistance. To find out the support you may be eligible to receive, search your state’s name + Medicaid funeral expense.
Even if there are no state-wide programs to help pay for your loved one’s funeral, there may be resources at the county or municipal level.
You may also receive assistance from other charitable organizations or local religious groups.
Keep reading to learn about some of the benefits you may be eligible to receive to assist you in paying for a funeral. Also, discover your best resource for finding programs to help with your financial obligations.
Burial
Some state Medicaid programs will assist with burying your loved one.
For example, Michigan has a program that will give a burial allowance of $475 to a funeral home toward a burial with a memorial service. The same program will pay an additional $145 to a cemetery, and an additional $100 to help pay for the vault.
In nearby Wisconsin, residents can benefit from the Wisconsin Funeral and Cemetery Aid Program. If the deceased person received Medicaid benefits, he or she may be eligible for up to $1,500 to be utilized for funeral expenses.
The State of Rhode Island will pay up to $900 for burial expenses for those who can show a financial need.
New Mexico will provide money for both funeral and burial expenses. The family’s resources will be taken into account when determining eligibility for this program.
The states of Montana, Kansas, Arizona, Arkansas, North Carolina, New York, South Carolina, and others, do not offer state resources for burials. This may change as the leadership in each state changes. Even if you find that your state is on the list as not offering assistance, check with the official state website to see if there have been any changes.
Also, even though you may not receive help at the state level, there are other departments you can turn to in this time of need. You may receive assistance from county or municipal programs.
Cremation
Some state programs will help pay for your loved one’s cremation expenses. The State of Michigan will pay up to $455 towards a cremation with a memorial service. This payment goes directly to the funeral home’s director. The state will also pay $145 towards the actual cremation expenses.
As mentioned, some counties have programs to assist with paying for final expenses. Some counties in Alabama will pay up to $400 to help with the costs. Most of the time, that money goes toward cremation since this is the most economical way to take care of the body. The state will not force the money to go toward cremation should the deceased’s religion prohibit that practice.
Maine offers $785 to spend on cremation. This amount is paid to the funeral director.
Some state programs do not specify whether the monetary assistance should be used for burial or cremation. One would think that more states would be willing to pay for cremations and other green burial options.
Donating a body to science
You may be surprised to learn that some universities will not pay to have a body transported to their facilities for study. Although, once the body is in their care, the university or medical school will often take care of the expenses associated with cremation.
There are government programs available to help pay for the transportation of the body to the facility for study. For example, a Michigan program will pay up to 32 cents per mile up to $176 to transport a body from a funeral home to a university program.
Donating your body to science has two benefits. First, you are helping the greater good by providing a body for students to study. Also, even though transportation to a facility is not always free, you won’t have to pay for the expense to cremate the body.
Irrevocable Funeral Trusts and Medicaid
If you are concerned about paying for your final expenses or your loved one’s funeral, you may be looking into every option available. One such option is to open an irrevocable funeral trust.
An irrevocable funeral trust is a stash of money that you put aside that can only be used for funeral expenses. This is different than pre-paying for a funeral because you do not have to pick the exact funeral home that you will be using. In fact, some families who have chosen to pre-pay for funeral expenses have lost the money when a funeral home unexpectedly closes.
Since the money in an irrevocable trust cannot be used for another purpose, these funds may not be looked at when determining Medicaid eligibility. Not all trusts qualify for this status, so it is essential that you work with a knowledgeable financial advisor before making this decision.
Also, be aware that there is a limit to the amount of funds you can put in a trust for funeral expenses. Each state sets the limit.
Finally, some financial advisors would recommend that those who are creating a trust to help qualify for Medicaid benefits would be better off seeking another option. You may want to look into purchasing funeral insurance instead.
Not everyone is able to pre-pay for end-of-life expenses. Your loved one may not have known about available resources or felt as if he or she could afford to put enough money aside for a trust or funeral insurance. If this describes your situation, you have no other option than to reach out to available programs.
How to Access Medicaid’s Funeral Assistance
Since each state’s policies are different, so it’s difficult to give a step-by-step formula on how to receive financial assistance. Receiving assistance may require you to contact various government officials and fill out paperwork. You also may need to provide official copies of death certificates to each office along the way.
Here are some general guidelines to help you with the process.
Step 1: Make sure there aren’t any other funds available
Sometimes people have life insurance without even being aware of it. Look through the paper trail your loved one left behind. Contact his or her place of employment to see if the company purchased a life insurance policy for your loved one.
If the deceased was a member of a union or the armed forces, they may qualify for a veterans death benefit or assistance from the union.
There may also be a death benefit of a couple of hundred dollars through the Social Security Administration.
Step 2: Talk with your funeral director or coroner
Your local funeral director has seen it all. He or she probably knows all the resources available for people who cannot afford the funeral expenses to bury a loved one.
In fact, this person will probably be your best resource in finding assistance to pay for final expenses.
Step 3: Talk with a county administrator
Your funeral director or coroner will be able to connect you with the proper county administrator who would know about local funds that are available to help pay for funeral expenses.
If this doesn’t work, check out your county’s official website and look for a contact in the health and human services department.
Step 4: Reach out to a state administrator
Once you have checked out all the resources at the county level, ask who you can talk with at the state level. Check online to see if your state offers resources to pay for funeral expenses.
Getting the Funeral Assistance You Need
Everyone wants to provide a special send-off to a family member who passed away. Instead of feeling bad that you can’t afford the top-of-the-line casket or a series of funeral events for people to attend, take solace in other family members and friends.
Gathering together and sharing memories of the one who passed is a healthy way to commemorate the death of someone close to you.
Post-planning tip: If you are the executor for a deceased loved one, you have more than just the funeral to think about. Handling their unfinished business can be overwhelming without a way to organize your process. We have a post-loss checklist that will help you ensure that your loved one's family, estate, and other affairs are taken care of.