MEDICAID LIENS- WHEN DO THEY COLLECT?

Medicaid (MassHealth in Massachusetts), the state/federal health insurance plan that covers nursing home care for most seniors, may place a lien on the home of those who receive Medicaid coverage of a long-term skilled nursing facility stay. But will they collect on that lien? The answer is – yes, if the home ended up in Probate court. Current state law says that if an elder put a spouse’s or child’s name on the deed, after the death of the elder the house automatically passes to the other owner, without going to Probate, and therefore a Medicaid lien will not be collected. However, if a family tries to sell the house of a person who has gone into a nursing home who is still alive, Medicaid can recover the cost of any Medicaid services provided after April 1, 1995. Exceptions: If a sibling has been living in the home for at least one year, or an adult child has been living in the house for two years or longer, and can show he or she was providing care to the elder. In either case they can request the repayment be delayed.

Some elders or families may be confused because the law has been changed and then changed back. Here is the history. Up until July 1, 2003, the state only would try to collect on a lien if your home ended up in Probate Court. For example, if an elder died and had no one else’s name on the deed to their home, his or her house would pass into Probate, where the court would determine what the elder’s will (if any) said. But if that same elder put a spouse’s or child’s name on the deed, the house automatically passes to the other owner, without going to Probate. A house listed in joint tenancy, with two names, would not be subject to Medicaid collection—because it never would go to Probate Court.

But as of July 1, 2003, a new law was passed in Massachusetts regarding what property the state could try to collect on once a Medicaid recipient died. The state changed the rules to expand the definition of “estate” to include any assets the person owned immediately before death and “other assets that would pass to a survivor, heir, or assignee of the decedent through joint tenancy, tenancy by the entirety, life estate, living trust, right of survivorship, beneficiary designation, or other arrangement.”

Under this wider definition, the state could theoretically collect on a lien placed on a house that never went to Probate, such as a joint tenancy or even a living trust agreement. The broader definition was supposed to bring in another $10 million for the state. But the new law never went into effect, because last winter, the legislature voted to suspend it.

Elderly homeowners should talk to an elder law attorney about their estate and the impact of Medicaid law before they might need long term care services. To get a list of elder law attorneys in your area, call 1-800 Age Info and press “3”.

-Adapted from: http://www.bshcinfo.org/news/qa1004.htm, ElderCare Q&A, By Linda George, Executive Director, Boston Senior Home Care