How is a Medicaid Lien Managed During Probate?

  1. Elder Law
  2. How is a Medicaid Lien Managed During Probate?
Medicaid puzzle

Federal law allows states to recover the money paid to Medicaid recipients via Medicaid payments. One way this is done is through a Medicaid lien on the real property of the Medicaid recipient.

A Medicaid lien allows a state to make a claim against a Medicaid recipient’s estate. The state can do this before the Medicaid recipient dies if it can be shown that the recipient is permanently institutionalized in a nursing home or other similar facility. If the recipient returns home, the state must discharge the lien. The only other time a Medicaid lien can be placed on a recipient’s property during their lifetime is if a court judgment has determined that Medicaid funds were improperly allocated to that recipient.

Even after the death of a Medicaid recipient, a state can impose a lien on the recipient’s estate. This allows them to recover the amount paid to the recipient after they turned 55. This is similar to other claims on the estate and will not require the sale of the home or other real property if there are sufficient funds in the estate to cover the amount of the lien. The Medicaid lien might not be satisfied if there are other claims on the estate that are considered a higher priority under state law.

There are also exceptions to recovery under a Medicaid lien. Medicaid cannot recover if the recipient is survived by a spouse or a child under the age of 21, or who is blind or disabled. Medicaid estate recovery may also be waived if it would create an undue hardship on the surviving family. An undue hardship includes siblings of the recipient who have an equity interest in the estate property and have lived in the home for at least one year prior to the recipient being institutionalized in a nursing home or other similar facility. In addition, an undue hardship can include surviving adult children of the recipient who lived in the home for at least two years before the recipient being institutionalized in a nursing home or other similar facility, have continuously lived in the home, and can show that they provided care to the recipient that delayed admission to that healthcare facility.

If you have a legal issue, we are here to help.  Contact King Law at 888-748- (5464) KING for a consultation. We have offices located across western North Carolina and upstate South Carolina.  King Law is here to serve you and help navigate this journey you are on.

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