Medicaid's Estate Recovery: Your Home at Risk?

Medicaid estate recovery programs can seek repayment for certain long-term care costs from a deceased enrollee's estate. In one instance, a son faced a $114,000 Medicaid claim against his late mother's home, which was fully paid off. The state placed a lien on the property, demanding payment within 60 days to avoid foreclosure.

Federal law mandates that states pursue repayment for nursing facility care, home-based services, and related medical costs for individuals aged 55 and older. Even a home initially excluded from Medicaid eligibility might still be subject to recovery after the owner's death, depending on state law and ownership.

However, numerous protections can prevent estate recovery. Nearly all states waive recovery if the estate meets hardship criteria or is the sole source of income. Furthermore, recovery is prohibited if the deceased is survived by a spouse, a child under 21, or a child of any age who is blind or disabled.

Transferring a home to heirs before death may not fully safeguard it, as Medicaid can look back up to five years for gifts. Consulting an elder law attorney and understanding state-specific rules are vital steps for homeowners. Building robust income streams and emergency funds can also provide financial resilience for healthcare needs.