Medicaid and asset recovery

Medicaid is a state ran program jointly funded by the Federal and State governments. The target of Medicaid is to provide medical care for those who cannot afford it on their own.

With such a entitlement program comes leakages. State Medicaid programs are full of enrollees that have significant assets, or the outright funds to afford their own private insurance. That is when the the Estate Recovery program comes in.

State Medicaid programs are allowed to recover the Medicaid benefits paid for services from some of the Long Term Support Services like Home and Community Based Services, HCBS, (which provides the Unskilled Services under home health). States may not recover from the estate of a deceased Medicaid enrollee who is survived by a spouse, child under age 21, or blind or disabled child of any age.

This means that if you or a loved one is an enrollee and passes away with significant assets without the exceptions above, the State can come after you. Whether they will is a discussion for another day. Currently, less than 5% of the Medicaid funded money is recovered yearly.

Sometimes enrollees are aware of this eventual recovery from their estate and are fine with it. It allows for them to remain liquid in terms of funds while alive, and then have the funds later recovered when they are no longer here. Think of it as the medical version of the reverse mortgage.

Often times though, enrollees are completely unaware and are shocked when they have the State coming after the estate of a loved one in a moment of grieving.

Remember the State will only come after those with significant assets that will not cause hardship on surviving qualifying family. The majority of those under the program will never have to pay a dime in return. Keep this is mind when signing up for Medicaid and the specific programs which may later be put up for recovery.