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What is Medicaid Estate Recovery?

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Quick Answer

Medicaid Estate Recovery is a program mandated by federal law requiring states to recover the costs of Medicaid services from the estates of people who received medical care, reports the U.S. Department of Health and Human Services. Amounts recovered depend on state law and eligibility for exemptions and hardship waivers.

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Full Answer

The Medicaid Estate Recovery program targets the estates of patients who received long-term care in nursing homes, home services, hospitals, facilities for the mentally retarded and other institutions as well as other services enrollees age 55 and over received, according to AARP. Some states use pre-death or post-death liens on property to collect recovery payments. According to federal law, states must defer or exempt recovery in cases of a surviving spouse, a minor or disabled child, or sometimes an adult child or sibling who lives in the decedent's home. Waivers are granted when survivors would experience undue hardship or assets such as working farms produce income for the surviving family. Federal law stipulates that the states must inform enrollees of the recovery program when they first apply for Medicaid.

Provision for a recovery program dates back to 1965 when the Medicaid program was first initiated, as reported by the U.S. Department of Health and Human Services. In the Omnibus Budget Reconciliation Act of 1993, Congress mandated that all the states must implement a Medicaid Recovery Program. The Affordable Care Act caused a controversial expansion of the Medicaid Estate Recovery program, according to USA Today.

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