Medicaid Reimbursement Post-Death - They’ll Find a Way
Most people know that in order to be approved for Medicaid coverage for nursing home care an applicant must meet strict asset tests. In Massachusetts a single applicant may not have more than $2,000 in assets, not including a primary residence, car needed for transportation, personal belongings, prepaid burial and funeral contracts, and a $1,500 burial account. The spouse of a married applicant may also keep $109,560, although this figure changes annually for inflation. All the Massachusetts Medicaid rules and regulations are located on the Office of Medicaid’s website.
What most people don’t realize is that once approved for Medicaid, Massachusetts has an automatic lien on the recipient’s probate estate. Under state Medicaid regulations, the Massachusetts Estate Recovery Unit must seek reimbursement for all coverage paid after age 55 from any assets owned at death that are subject to the probate process. Notice, though, that I said “subject to the probate process”. Assets that pass outside of probate are not subject to estate recovery.
Massachusetts keeps computer records of all MassHealth benefits paid and they will find a way to collect. Take, for example, a recent news story about an abandoned safe. A woman who had owned a local business presumably received MassHealth coverage for nursing home care at the end of her life. After death, a business safe was discovered to contain approximately $175,000 in cash. Without being able to show a lawful co-owner to the cash it would be subject to probate in order to pass it to her family. That also subjects the cash to estate recovery. In this case, there will be only about $10,000 to pass on to her children.
I don’t know the details of this woman’s circumstances, but I do know that planning ahead can protect assets for family. Even once someone is in the nursing home there are still options to salvage a modest inheritance for children. There are also numerous exceptions to the asset rules. I often say that MassHealth is about the exceptions more than it’s about the rules.
No matter what the scenario, there is no substitute for the advice of a well-qualified elder law attorney. Only the simplest of circumstances is appropriate for the numerous Medicaid application services. They are often contracted for by the nursing home, and have an objective of getting the application filed as soon as possible, often without doing their due diligence.
You and your family would be better served by your own independent counsel. Look for an attorney who is a member of the National Academy of Elder Law Attorneys. Some states have their own chapter of this organization - Massachusetts has the largest, with nearly 500 members. This premier organization counts among its members attorneys who are most serious about Medicaid representation, not attorneys who look at Medicaid as merely filling out a form. NAELA members are generally the most qualified and familiar with local Medicaid rules and exceptions.
Tags: Estate Recovery
Loading ...