Articles Posted in Estate Recovery

Are you residing in Macomb, Oakland, Wayne, Ottawa or Kent County? Do you have a loved one or family member residing at a nursing home? Does he or she currently receive benefits from the State of Michigan in the form of long-term care Medicaid for nursing home care?

If the answer is “yes”, you may be exposed to estate recovery. Michigan adopted Estate Recovery, retroactively, for seniors that received Medicaid benefits. Estate Recovery is a law that entitles the State of Michigan to recover assets from an applicant’s estate if he or she received nursing home Medicaid benefits during his or her lifetime.

Although exemptions exist, the common target and biggest asset in an estate is a home. Homes are a protected or “non-counted” asset at the time of Medicaid application, but, now, following death, a home can become a target of recovery. The current statute, which may change, provides that the State may, effectively, lien the home through the probate process.

Confused about Estate Recovery in Michigan? Apparently, so is the State of Michigan.

After several years of thumbing its nose at CMA, the State of Michigan finally adopted an estate recovery program. The legislature enacted law requiring estate recovery for long term care Medicaid recipients. The end result is that estate recovery will effect any nursing home recipient who received benefits prior to May of 2011. Although estate recovery was not formally accepted as a regulation within the state’s Medicaid system until July 2011, it is apparent that the State implemented the new law effective May of 2011.

Even more confusing than the effective date of the new law, its implementation is even more puzzling. The State has contracted with an outside agency, HMS, to collect debts from the estates of Medicaid recipients. The forms and procedures used by HMS are confusing to everyone, including attorneys and the agency itself.

In November of last year, the State of Michigan adopted a new estate recovery law. For those of you unfamiliar with the concept, “estate recovery” is a term that describes the State’s ability to recover funds from people that have been approved to receive Medicaid benefits for nursing home care. For many Medicaid applicants this means that the State would have a right to file la lien against a Medicaid recipients estate. Primarily, the target of these recovery acts are the Medicaid recipients’ homes.

Following the enactment of the Deficit Recovery Act of 2006, the federal government made it clear that all states seeking funds for Medicaid programs needed to adopt an estate recovery statute. Seemingly, this provision targets Michigan, as it remained as the only state without such a law.

Michigan’s legislature slowly implemented such a law last year. The only remaining issue for it to be implemented was federal approval. At the end of October, we received word that the federal government rejected Michigan’s proposed estate recovery law. As a result, Michigan remains as the only state without an estate recovery law. For the time being, Medicaid applicant’s homes are safe.

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