If you have Term life insurance, there is no cash value in it to count as an asset in a Medicaid spend down. If you have Whole or Universal life insurance with a large amount of cash value, it may or may not exceed cash value limits of policies that you can keep while entering a nursing home with Medicaid funds. Your social worker will tell you.
If your policy does have high cash value, there is a law that allows you to retain some of the death benefit and use your cash to pay for your nursing home care. Or, you can transfer ownership of your policy to someone else, if it will be at least 5 years before you need to use long term care, and if you do not have the resources to pay for it in other ways. The nursing home will not take your life insurance policy. It will be evaluated along with all your assets, if Medicaid is needed.
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If your policy does have high cash value, there is a law that allows you to retain some of the death benefit and use your cash to pay for your nursing home care. Or, you can transfer ownership of your policy to someone else, if it will be at least 5 years before you need to use long term care, and if you do not have the resources to pay for it in other ways. The nursing home will not take your life insurance policy. It will be evaluated along with all your assets, if Medicaid is needed.