The Tools Available to Medicaid to Recover Benefits Paid after Your Death
If you receive benefits from Medicaid, known as MassHealth in Massachusetts, during your lifetime, Medicaid may attempt to recover those benefits from your estate, though nothing can be taken until the death of your spouse, provided you were married at the time of your death. In addition, Medicaid cannot pursue reimbursement while there are minors (under the age of 21) living in your primary residence, or if there is a blind or disabled person living in your home.
Because Medicaid benefits are paid through the state, it is the state that has the option to seek reimbursement of benefits paid. States are required to recover funds from your probate estate, i.e., property that was held exclusively in your name without a valid beneficiary designation. With respect to property in which you had some interest, but which passed outside of the probate process, a state can choose to pursue repayment or leave it alone. For example, if you owned property jointly with another person, or had a life estate in certain property, the state can opt not to seek recovery. Massachusetts is one of those states.
As a practical matter, though, the only property of significant value that most people own at death is a home or residence. If your home is not included in your probate estate, most states, including Massachusetts, won’t file a claim to recover Medicaid benefits from the value of the home.
Know your options. Waiting until the MassHealth recipient dies to learn your options can have devastating and costly effects. Certain actions to protect your home and other assets from MassHealth must be taken while the recipient is alive or forever lost.
States are required to place a lien on real property that a Medicaid beneficiary owns while receiving benefits, unless a spouse or certain relatives still live in the home. This lien is designed exclusively to address circumstances where a Medicaid beneficiary sells a home, and should be extinguished upon the death of the Medicaid recipient. If you sell your home while receiving Medicaid benefits, you will be required to repay Medicaid for any coverage thus far, and will probably become ineligible for further Medicaid benefits, depending on the profit you make from the sale.
Contact Experienced Trust, Will & Estate Administration Attorneys
We can help you with any legal issue related to your MassHealth and Medicaid benefits. Contact our Boston elder law attorneys by e-mail or call us toll-free at 1-800-701-0352.