Intro: Medicaid Estate Recovery

In an upcoming series of blog articles, we’ll be writing on a little known subject called Medicaid Estate Recovery (MER). It surprises many people that a government healthcare program for aging seniors has a payback requirement. The program is not Medicare. It has no such provision. It is Medicaid. Medicaid estate recovery only applies to recipients age 55 and over who receive long term care services either in a nursing home or in their community home. The payment is due after the recipient dies. We will get into more detail later.

The topic is current for two reasons. First, there is a bill in Congress to repeal MER, the “Stop Unfair Medicaid Recoveries Act.” It has no chance of passing in this presidential election year but we expect it will be reintroduced in the next Session. The second reason follows from the first, until it is repealed seniors and their advocates need to know about MER and advocate for its repeal.

Who does this program affect? Many people know of Medicaid as a program only for the poor. That is not true for the long term care components of Medicaid. While poor recipients do receive Medicaid long term care benefits, there are many middle class recipients. For example Medicaid is the major payer of long term nursing home care, a cost that can exceed $11,000 per month. To make the point clearer, a married couple with a net worth over one million dollars can qualify for these services.

Why does Medicaid require payback, when no other program has such a requirement? While there have been many “moral” arguments put forward as justification, the main reason is that it is supposed to help fund the program. It has failed that purpose. In 2023 the respected MACPAC commission, whose role is to advise Congress conducted a major study of Medicaid Estate Recovery and found that it only produced .5% of the Medicaid budget. That finding was made on top of another that concluded the states were not allowing exemptions from payback to recipient families. We’ll look at the report in more depth in a later post.

The Shock and Harm of MER
The fact that Medicaid Estate Recovery is little known to the public outside of elder law and estate planning attorneys does not mean the harm is theoretical. There are many stories that have been published about the shock families receive after their loved one has died when they receive notice about the state’s claim for payback. The claim is very often over $100,000. We will share some of those in a later post.

Call for Action
We urge all readers to spread the word about repealing the cruel program of Medicaid Estate Recovery. The “Stop Unfair Medicaid Recoveries Act.” is pending in Congress. We hope all seniors, all families facing long term care, and all advocates and geriatric professionals should contact their representative in Congress and tell them to cosponsor the “Stop Unfair Medicaid Recoveries Act.” It is enrolled in this 118th Congress as H.R. 7573. It simply provides for the repeal of MER and the release of any lien or claim against a recipient’s property the state may have placed. As of writing it has 28 co-sponsors, out of 435 members in the House.