What is the Medicaid Estate Recovery Program?

Toni,
I have a client who just received a bill for her mother’s Medicaid Long Term Care that was done at her house instead of a nursing home during the last few years of her mother’s life. My client had no idea that Medicaid was running a tab; otherwise she would have had the family take turns look after her mother at home.

            Sue is now stuck with a $43,200.00 bill, on her mother’s estate (house) that Medicaid says must be paid in full. Her mother died at least a year ago.

            She recently received a document from MERP (Medicaid Estate Recovery Program) saying that Medicaid wants the money used for her care back because Sue’s mother owned a house. What is MERP or the Medicaid Estate Recovery Program?

            Toni, let your readers know that Medicaid is keeping a tab, so be careful when receiving Medicaid help? Especially if you still own your home, like Sue’s mother did, but had no money for “extra” care at home.
Thanks, Chuck

Hello Chuck:

What a great question!!  After researching what the MERP (Medicaid Estate Recovery Program), I found it to be very eye opening.

With Healthcare Reform (Obamacare) everyone needs to be aware that nothing comes without a cost!!  And yes, you can lose your house or any assets when your loved one receives care from the State of Texas’s Medicaid program.

This is a real surprise when a Medicare beneficiary receives Medicaid Long Term Care and later the Medicaid recipient’s estate receives notification from the state of Texas for a “Notice of Intent to File a Claim against the Estate.

I am sure your client was astonished to find out that the state want their $43K back that Texas Medicaid spent for her mother’s care, even though it was at home and not in a nursing home.

Medicaid can recover ANY and I repeat ANY medical expenses, not just nursing facility services or home and community based services, but also includes related hospital services, prescription drugs and even Medicare cost sharing expenses which are… Medicare premiums (Part A – hospital insurance, Part B – medical insurance), deductibles and coinsurance amounts.

Some of these services may be part of the $43K your client has to pay back to Medicaid.  You asked if the state can take her mother’s house.  Yes. All claims against an estate, including MERP claims, must be paid before the property can be distributed as specified in a will. The state does not, however, require an heir to sell the deceased recipient’s homestead (house) if the claim can be paid by other funds. But if not, then you may have to sell the house or the state will file a lien against the house.

The state does not process its own paperwork and so it has contracted with HMS, the Texas Medicaid Estate Recovery Contractor who handles the complete process. In the letter sent to the recipient’s estate it states…the amount received will not exceed the value of the estate’s assets, if any.  If there is no money in the estate, then there is nothing to recover.

Now…you know how the Medicaid’s Long Term Care services operate.  My advice would be to explore all of your options and maybe as a family can work out a schedule to take care of your loved one or ask the church to find a volunteer or two to assist in the process.  This way you can protect all that your loved ones have worked, so hard to accumulate.

Toni Says®:

  • Buy a long term care policy while you are still in decent health
  •  Put some money away for that rainy day.
  •  Seek the advice of an Elder Care Attorney that can help with proper Medicaid planning.
  • Do proper planning…No one wants their kids to be their caregiver and take care of their activities of daily living such as bathing, dressing, bathroom problems, etc. But we are here to make sure they have the best life they can.

Toni King, author of the new Medicare Survival Guide®, which is a simple guide that puts Medicare in “people” terms, is on sale at www.tonisays.com  Email questions to www.tonisays.com/ask-toni or call 832/519-TONI (8664).

 

 

About the Author

Toni KingToni King is a recognized subject matter expert and a passionate advocate for those who are overwhelmed by Medicare rules and requirements. She is a published author (The Medicare Survival Guide), a workshop presenter (Confused About Medicare Workshops) and writes weekly articles for 14 area newspapers. Toni also offers one-on-one consulting services for those who need help sorting through the confusion of the enrollment process and choosing benefits.View all posts by Toni King →

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