Public Aid Guide

Introduction

Clients Ask About Pre-Arranged Funerals and Pre-Financing for Future Recipients of Illinois Department of Human Services Assistance. Today, almost fifty percent of all nursing home residents are clients of the Illinois Department of Human Services or may soon become clients.

They and their families regularly express interest in making funeral arrangements. This is a valid concern. Properly coordinated, pre-financed funeral arrangements can assure an individual that funeral funds can be available for themselves or their loved ones.

Failure to make arrangements in advance of applying for Human Services assistance is frequently an innocent oversight by the individual or those who care for him or her. The result can be that funds are depleted and the funds which should have been set aside are not available at the time of need.

If you, a relative or friend are in circumstances that may ultimately lead one of you to becoming a recipient, it is important that you know your options in selecting funeral services and merchandise in advance of need and preferably before applying for benefits from the Illinois Department of Human Services.

Department of Human Service’s summary policy explains:

In determining the existence and extent of need for a State Supplemental Payment, the following funeral-related assets are exempt:

Burial Assets

Assets
A $6,050 irrevocable trust or an Irrevocable Insurance Policy or a prepaid burial plan of $1,500 or less if there is no other form of life insurance or Life insurance when the total face value also does not exceed $1,500 per person. OR Asset Disregard: Cash or savings accounts not exceeding $2,000 for a client and $3,000 for a client and spouse or dependent living together.Exempt Burial Assets: burial space purchased in advance, which may include casket, vault, grave, marker, crypt, as well as cemetery opening and closing costs.

Check with Your Funeral Director

First check with the funeral director of your choice before making an application for assistance. The reason is simple. You may not yet be eligible for assistance. But, if you contact IDHS before making pre-arrangements, your options may seem to be more limited than you really would prefer. For example, funeral services may cost, say, $3,000, excluding merchandise. You are allowed $1,500 in exempt assets or $6,050 in an irrevocable trust. If you choose to not make your trust irrevocable, any amount over $1,500 will reduce your $2,000 cash asset. The BEST CHOICE for those seeking assistance is to elect the irrevocable option. This will protect more of your preneed account. In summary, you can have the service of your choice.

Arrangements properly coordinated in advance of application can legitimately apply important funds you may want set aside for your funeral. Your wishes will be clear to your survivors.

You may legally deposit funds needed to provide funeral arrangements of your choice. You should make your funeral arrangements well in advance of making application to the Illinois Department of Human Services. Such advance planning can provide you with options that you may not have if you wait until need is imminent and resources are insufficient to meet your preferences.

The IDHS has legitimate reasons for the limits in each category of exempt assets, but your funeral director can help you determine which arrangements may best meet your needs.

Too, it may be that you already have a pre-financed funeral with a funeral home. However, if it does not, for example, include a vault or cemetery opening and closing charges, you may want to set aside funds to cover items you select. You can protect other assets by following your funeral director’s guidance prior to making application for assistance. Your existing agreement may need attention to assure that your assets, including earned interest, are still exempt.

The Illinois Department of Human Services allows $1,103 for the funeral and up to $552 for cemetery expenses when they pay for the funeral in the absence of other funds. Because this allowance is well below the funeral director’s actual cost of operation, the merchandise included may or may not meet your desires or those of your survivors.

Illinois Burial Allowances

The Governor has been asked to reinstate the below allowances for burial of indigents.  The Illinois Department of Human Services will allow non-responsible relatives to contract for the funeral service of their choice and upon receipt of a claim may reimburse up to $1,655 of the amount paid. For example, a daughter may select a $6,900 funeral, pay $2,000 or all of it and receive up to $1,655 reimbursement from the Illinois Department of Human Services. In calculating what IDHS will pay, it is important to know that any assets of the deceased or his or her estate will be deducted from what IDHS will allow, except nursing home funds, which the Department will claim.

For example, if a client has $100 in a savings account, IDHS’s payment will be as follows:

Funeral Allowance $1,103
Cemetery Allowance $552
Maximum Available $1,655
Less Savings Account $100
Amount paid toward funeral and burial by IDHS or a reimbursement to a nonresponsible relative $1,555

In summary, when there are questions related to pre-arranged and/or pre-financed funerals, contact the funeral director of your choice. He or she knows how to help you help yourself. He or she is a professional who will provide valuable information and assistance.

If this is the case, a non-responsible person may upgrade and pay for the casket and vault as well as additional services selected, up to a maximum of $2,000. The non-responsible party may also pay to the cemetery an additional amount up to $2,000 for services provided over the allowable reimbursement amount.

Illinois Human Services Eligibility

Human Services Eligibility Limits
Burial Allowance Asset Disregard Exempt Assets Exempt Burial Assets
$1,500
$6,050*
*(if in an irrevocable trust)
Burial Trust or Life Insurance*
*If face value is more than
$1,500, then the cash value is
considered against the asset
disregard		 $2,000 
inCash
Stocks
Bonds/CDs
Savings Account
Resident Account
Checking Account		 Clothing
Homestead property
Personal effects
Household furnishings
1 Motor Vehicle		 Casket
Vault
Burial Space
Marker
Crypt
Mausoleum
Opening and Closing Charges
Sales Tax
  • If you set-up an irrevocable trust agreement with a funeral director, $6,050 of your service cost and cash advance items will be exempt.
  • If you set-up a revocable trust agreement with a funeral director, $1,500 of your service costs and cash advance items will be exempt.

Also

  • You will be allowed $2,000 in asset disregard.
  • You will be allowed to set up funds for the value of a casket, vault, opening and closing costs, grave space, marker, crypt and mausoleum

And

  • Other exempt assets are clothing, homestead property, household furnishings and one motor vehicle.
  • If your service charge and cash advances equal more than $6,050 the amount over $6,050 will reduce your $2,000 cash asset.