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Medicaid Estate Recovery
Medicaid estate recovery is required by federal law (Social Security Act
- 42 USC 1396p) as well as by State law (IC 12-15-9).
In cases where a Medicaid recipient dies and has an estate, the State is
to file a claim against the estate in order to be reimbursed for services
it paid on behalf of the individual when he/she was age 65 or older. In
addition, the claim includes payments for services provided to a recipient
age 55 or older if the services were provided on or after 10/1/93. The claim
includes the cost of all types of Medicaid services provided to the recipient.
Assets subject to recovery
All assets in the recipient’s probate estate are subject to recovery.
Assets that were exempt (not counted) for Medicaid eligibility purposes may
be subject to estate recovery. (Probate is the process by which the real
and personal property of a deceased person is distributed to heirs (if there
is no will) or to beneficiaries named in the will.)
Some assets outside of the recipient’s probate estate are subject to
recovery.
Assets not subject to recovery
- Proceeds of a life insurance policy or annuity.
- The first $125,000 of jointly-held real property with rights of
survivorship (until 2008).
- Real estate used for the support, maintenance, or comfort of the
surviving spouse, dependent child under age 21, or a dependent who is
non-supporting due to blindness or disability.
- Personal effects, keepsakes, and ornaments of the deceased.
- Assets protected by the use of an Indiana Partnership long term
care insurance policy.
Filing of a Claim
There is no time limit as to when the State has file its claim. However,
it is still important for claims to be filed in a timely manner. Most estate
recovery efforts do not involve court proceedings. Court proceedings usually
occur for estates valued at, or greater than, $25,000.
The State may waive its claim against a deceased recipient’s estate if
enforcement of the claim would result in undue hardship for the survivors.
Basically, "undue hardship" means the survivors would become
eligible for public assistance if the State enforced its claim.
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