State Recovers Medicaid Costs from Estates
Q: My mother recently died in a nursing home where she was getting Medicaid benefits. I am the executor of her estate, and my lawyer says I have to notify the Ohio Attorney General so the state can recover assets to pay for the Medicaid benefits she received. Why must I do that?
A: Federal law requires Ohio to try to recover money from your mother’s “estate” for Medicaid services paid on her behalf while she was alive. In general, to qualify for Medicaid, a person must have used up all of her assets. If your mother still owned assets at her death, the government has a right to recover the Medicaid money that was spent on her behalf. Assuming your mother was a permanent nursing home resident or on a home and community-based waiver program such as PASSPORT, the state may recover her assets now that she has died. If she was not in a nursing home or on a waiver program in the community, however, the state can only recover from her estate if she was 55 or older when she died. The state can only recover from an estate after the Medicaid beneficiary and his or her spouse have died.
Q: Who recovers the assets?
A: The Ohio Attorney General’s Office administers the estate recovery program on behalf of the Ohio Department of Job and Family Services, although sometimes estate recovery claims may be handled by private attorneys on behalf of the Attorney General.
Q: How will I know if the state will try to recover Medicaid costs from my mother’s estate?
A: Assuming you are a beneficiary of your mother’s estate, you will need to know if your mother’s estate owes money to the state. If there is a probate proceeding, you must notify the Attorney General’s Office within 30 days of your appointment as the estate’s executor. After you have provided notice, the Attorney General will file a claim with your mother’s estate. In cases where there is no probate estate, the Attorney General’s Office sends a letter to the Medicaid recipient's authorized representative.
Q: What assets can the state recover?
A: Up until 2005, the state could only try to recover from probate assets, but in House Bill 66, the definition of “estate” was expanded to include any property in which the Medicaid recipient had any interest at the time of death. This includes assets in a living trust, joint assets, transfer-on-death and payable-on-death assets, and life estates.
Q: Does the state have a time limit in which to recover the assets?
A: Ohio law provides that the Attorney General’s office must present its estate recovery claim to the person responsible for the decedent’s estate within 90 days after receipt of notice from the responsible party or one year after the Medicaid recipient’s death, whichever is later.
Q: Are there exceptions to estate recovery?
A: The state cannot recover against assets passed to the surviving spouse during the survivor’s lifetime. Also, if the assets pass to a child under 21, or to a blind or disabled child of any age, no recovery is allowed. In addition, the Ohio Department of Job and Family Services may grant an undue hardship waiver against recovery on a case-by-case basis. Generally, this request will only be granted if the estate’s beneficiary was financially dependent on the Medicaid recipient and recovery would deprive the beneficiary of necessary food, clothing, or shelter, or require the beneficiary to receive public assistance.
This “Law You Can Use” column was provided by the Ohio State Bar Association. It was originally prepared by attorney James C. Bates, and updated by attorney Janet E. Pecquet of Beckman Weil Shepardson LLC.