Massachusetts Life Settlement Legislation

After nearly being enacted last year, a bill impacting the life settlement industry in Massachusetts has been re-filed for the State’s 2017-2018 legislative session. “An Act Relative to Medicaid” (H508), sponsored by Rep. Coppinger, would permit individuals with a life insurance policy valued at $10,000 or more to enter into a life settlement contract in exchange for direct payments to providers for long-term services (e.g., home health care, assisted living, and nursing home services). Under the bill, the proceeds from these life settlement contracts would not be considered an asset or resource in determining Medicaid eligibility and must be fully spent down before any State or Federal Medicaid funds are to be used. In order to inform individuals about this option, the bill would require the State’s Department of Health and Human Services to include written information about the program as part of the Medicaid application materials. Last session, the bill was reported favorably by two joint committees and passed in the House but was not voted on by the Senate. The bill has been referred to the Joint Committee on Financial Services again this session.