The Benefits of a Reverse Mortgage may include: 

• Tax-free funds for as long as you live in your home
• No loan repayment for as long as you live in your home
• No income, medical, or credit requirements
• No restrictions on how you may use the funds
• Retain ownership of your home for life; this is guaranteed as long as you maintain your home, pay home owner's insurance and real estate taxes
• Line of credit for emergency needs
• Choose a cash flow plan tailored to your needs

Keeping money in a reverse mortgage line of credit in most states will not count as an asset for Medicaid eligibility as this would be considered a loan and not a resource for Medicaid spend down.  In other words, keeping money in the line of credit will not disqualify you from becoming Medicaid eligible.

Transfering money from a reverse mortgage to an investment or to a bank account would represent an asset and would trigger a spend down requirement  and delay eligibility.  Please note however that distinguishing between what portion of reverse mortgage proceeds might be counted as a loan and what portion as an asset is not a simple black and white decision.  It is best to get an opinion from an elder attorney in your state.