Healthcare/Obamacare Medicaid Liens

[bizlady]

Though MN has its own services rather than Healthcare.gov, this is an interesting development for those 55 and over that signed up for healthcare and qualified for Medicaid.

Until now, MN was relatively passive about liens for Medicaid.

Some shocked by estate claims from Medicaid via MNsure

[bingybear]

this is not the ACA (heathcare.gov), but medicaid. I know when someone has medicaid pay for LTC, they have a lean on remaining assets. If one tries to use a medicaid compliant annuity to shelter assets for the community spouse ... medicaid will be the primary beneficiary of the annuity after the community spouse dies. So I would think this should be expected.

I think they can claim when the estate is handled (probate or not).

[jim584672]

When I looked into this the Federal law requires estate recovery for >=55 for Medicaid benefits recd. Each state interprets the law differently. Some apply it for LTC cases only. Others for everything. They can't place a lien on real estate for MAGI Medicaid, only on the estate upon your death.

So when I turn 55 I will be sure to get over 138% FPL to get into a non-Medicaid plan.

[bizlady]

Quote:

Originally Posted by jim584672 So when I turn 55 I will be sure to get over 138% FPL to get into a non-Medicaid plan.

My point exactly for those able to take advantage of the Healthcare laws whether on a state exchange or thru Healthcare.gov

[imoldernu]

I believe state laws in progress.
Elderlaw take:
Medicaid's Power to Recoup Benefits Paid: Estate Recovery and Liens | ElderLawAnswers
In our case, some 20 yeas ago, the lien/recovery was not even in place in many states. The state programs accepted the cost and the loss. Obviously this had to change.

Quote:

The exceptions to this rule are cases where a spouse, a disabled or blind child, a child under age 21, or a sibling with an equity interest in the house is living there.

In settling a lien, any transfer of a home would work normally, same as a builder loan... to be paid of to insure clear title.

That's my take...

[jim584672]

Since MAGI Medicaid (the expanded group under the ACA) does not involve a nursing home no lien can be placed on real estate while the person is living in the home. A general lien on the estate might be placed, if your state wants to do this. In my state avoiding probate with Life Estate Deeds and transfer on death accounts (TOD) prevents the recovery since it avoids probate.

[bingybear]

Quote:

Originally Posted by jim584672 Since MAGI Medicaid (the expanded group under the ACA) does not involve a nursing home no lien can be placed on real estate while the person is living in the home. A general lien on the estate might be placed, if your state wants to do this. In my state avoiding probate with Life Estate Deeds and transfer on death accounts (TOD) prevents the recovery since it avoids probate.

I thought you still had to pay debts even if you avoid probate. Maybe it is just my ethics.
Watch the laws on this. I would not be surprised of they change. You aren't talking about giving the right to collect, just the right to place a lien.

[ivinsfan]

I'm in MN too and shake my head at the naive thinking of the people in this article. One said they didn't mind the lien, but thought they should only be charged for the medical services they actually used and not the monthly insurance premium.

I don't really have a problem with this and expect something of this sort to eventually be applied to all the ACA policys..I do have an issue with the 55 and over, I think it should be applied to everyone over 21.

[jim584672]

Quote:

Originally Posted by bingybear I thought you still had to pay debts even if you avoid probate. Maybe it is just my ethics. Watch the laws on this. I would not be surprised of they change. You aren't talking about giving the right to collect, just the right to place a lien.

Each state can come after the whole estate or just the part that lands in probate when it comes the Medicaid estate recovery. It is very common where I live to put Real Estate into a Life Estate and avoid probate.

[jim584672]

Quote:

Originally Posted by ivinsfan I'm in MN too and shake my head at the naive thinking of the people in this article. One said they didn't mind the lien, but thought they should only be charged for the medical services they actually used and not the monthly insurance premium. I don't really have a problem with this and expect something of this sort to eventually be applied to all the ACA policys..I do have an issue with the 55 and over, I think it should be applied to everyone over 21.

Since they were not in a fee for service situation, but a managed care plan, they owe the monthly capitation fee, even if they had no expenses themselves.

Estate recovery was designed for elderly estates, not young people. The law should exclude the MAGI group entirely.

[ivinsfan]

Quote:

Originally Posted by jim584672 Since they were not in a fee for service situation, but a managed care plan, they owe the monthly capitation fee, even if they had no expenses themselves. Estate recovery was designed for elderly estates, not young people. The law should exclude the MAGI group entirely.

With the expanded Medicaid and the ACA tax credits, it will be interesting to see if those with higher net worth are expected to do some form of payback with their estates after they are deceased. There is a program in place, so it's not too far fetched to think this might be a cost control measure.

[jim584672]

Quote:

Originally Posted by ivinsfan With the expanded Medicaid and the ACA tax credits, it will be interesting to see if those with higher net worth are expected to do some form of payback with their estates after they are deceased. There is a program in place, so it's not too far fetched to think this might be a cost control measure.

It is only in place for the Medicaid side. The law would need to be changed for it to happen for the ACA subsidy side. This is not going to happen politically.

[outabout]

Here's Colorado Medicaid recovery:

For recipients age 55 and older at the time they received medical assistance, recovered costs are limited to nursing facility services, home and community-based services, and related hospital and prescription drug services.

[gauss]

Quote:

Originally Posted by bingybear I thought you still had to pay debts even if you avoid probate. Maybe it is just my ethics. Watch the laws on this. I would not be surprised of they change. You aren't talking about giving the right to collect, just the right to place a lien.

The (probate) estate indeed is obligated to pay just debts - legally and morally.

Jointly owned with rights of survivorship accounts and other property not owned solely by the deceased, on the other hand, are not part of the estate if I am correct. Tenancy in Common would be an exception to this.

If there are not enough funds in the estate to payoff all the creditors, the states laws of precedence and court action may take place.

At a high level, this is somewhat conceptually similar to Bankruptcy according to my understanding.

-gauss

[imoldernu]

From gov't site

https://www.medicaid.gov/medicaid-ch...-recovery.html

Quote:

Estate Recovery and Liens State Medicaid programs must recover certain Medicaid benefits paid on behalf of a Medicaid enrollee. For individuals age 55 or older, states are required to seek recovery of payments from the individual's estate for nursing facility services, home and community-based services, and related hospital and prescription drug services. States have the option to recover payments for all other Medicaid services provided to these individuals, except Medicare cost-sharing paid on behalf of Medicare Savings Program beneficiaries. Under certain conditions, money remaining in a trust after a Medicaid enrollee has passed away may be used to reimburse Medicaid. States may not recover from the estate of a deceased Medicaid enrollee who is survived by a spouse, child under age 21, or blind or disabled child of any age. States are also required to establish procedures for waiving estate recovery when recovery would cause an undue hardship. States may impose liens for Medicaid benefits incorrectly paid pursuant to a court judgment. States may also impose liens on real property during the lifetime of a Medicaid enrollee who is permanently institutionalized, except when one of the following individuals resides in the home: the spouse, child under age 21, blind or disabled child of any age, or sibling who has an equity interest in the home. The states must remove the lien when the Medicaid enrollee is discharged from the facility and returns home.