How Does Life Insurance Affect Medicaid? 
There are two factors determining whether life insurance affects your ability to qualify for Medicaid : your states status on expansion , and whether your life insurance has cash value . The Affordable Care Act encourages states to expand Medicaid eligibility . The states expanding may no longer have asset based eligibility criteria . If you live in one of these states your life insurance does not matter . The states choosing not to expand may have asset and income criteria . The asset criteria is $ 2,000 and a cash value life insurance policy may impact eligibility . Term life insurance does not have cash value and would not be considered an asset . Permanent policies such as universal life and whole life do have cash value and would be considered an asset . 