Medicaid is a health insurance program that provides medical benefits to low-income individuals and families in the United States. Medicaid does not have a provision that allows it to take your house if you cannot pay for medical expenses. The government cannot place a lien on your home for home care services. However, a nursing home can place a lien on your house if you cannot pay. If you’re worried about losing your home because of medical bills, it’s important to speak to an attorney about your options.
Medicaid Estate Recovery Program (ERP)
The Medicaid Estate Recovery Program (ERP) is a federal program that allows states to recover Medicaid payments from the estates of deceased individuals.
- This program is designed to help states recoup some of the costs of providing Medicaid benefits.
- Medicaid is a health insurance program for low-income individuals and families.
- It is funded jointly by the federal government and the states.
How Does ERP Affect Inherited Property?
The ERP can affect inherited property if the deceased individual received Medicaid benefits for nursing home care or other long-term care services.
- In these cases, the state may file a claim against the deceased individual’s estate for the amount of Medicaid benefits that were paid.
- If the estate does not have enough assets to cover the claim, the state may be able to place a lien on the deceased individual’s home.
- This means that the home cannot be sold or transferred until the claim is paid off.
Protecting Inherited Property from ERP Claims
There are a number of ways to protect inherited property from ERP claims.
- One option is to place the property in a trust.
- Another option is to purchase a Medicaid annuity.
- A Medicaid annuity is a contract between an individual and an insurance company that provides for the payment of a monthly income to the individual for the rest of their life.
- In exchange for the monthly income, the insurance company receives the individual’s assets after their death.
State Variations in ERP
The ERP is a federal program, but it is administered by the states. As a result, there are some variations in how the program is implemented from state to state.
| State | ERP Lookback Period | ERP Recovery Limit |
|---|---|---|
| New York | 5 years | No limit |
| California | 3 years | $50,000 |
| Florida | 5 years | $500,000 |
Medicaid Estate Claims
Medicaid is a health insurance program for people with low incomes and limited resources. Medicaid does not usually take your house. However, if you receive long-term care benefits from Medicaid, the state may file a claim against your estate after you die.
Medicaid Estate Claims
- Authorized Under State Law
- Applies to Long-Term Care Services
- Recovers Costs of Care from Deceased Beneficiary’s Estate
The state can make a claim against your estate if you received Medicaid benefits for long-term care services, such as nursing home care or home health care. The state can claim the amount of money it paid for these services, up to the value of your estate.
Medicaid Estate Recovery: How It Works
| Medicaid Eligibility | Must meet income and asset limits |
|---|---|
| Long-Term Care Services | Skilled nursing facility, home health aide, personal care aide |
| Estate Recovery | State may make a claim against the deceased beneficiary’s estate to recover the cost of long-term care services paid by Medicaid |
Avoiding Medicaid Estate Claims
- Spend Down Assets
- Purchase Long-Term Care Insurance
- Create a Medicaid Trust
To avoid having Medicaid claim your house, you can take steps to protect your assets. You can do this by:
- Spending down your assets to the Medicaid limit before you apply for Medicaid.
- Purchasing long-term care insurance to cover the cost of your long-term care.
- Creating a Medicaid trust to protect your assets from Medicaid’s estate recovery program.
If you are concerned about Medicaid taking your house, you should consult with an attorney who specializes in Medicaid law. They can help you create a plan to protect your assets and ensure that your family will not be left with a large debt after you die.
Medicaid Eligibility and Asset Limits
In New York, Medicaid is a government-funded health insurance program that provides coverage to eligible low-income individuals and families. To be eligible for Medicaid, individuals must meet certain income and asset limits. Assets include cash, bank accounts, stocks, bonds, and real estate (excluding the primary residence).
For individuals applying for Medicaid nursing home care, there is a five-year lookback period. This means that Medicaid will look back over the past five years to see if the individual transferred any assets for less than fair market value. If so, the individual may be ineligible for Medicaid for a period of time.
Medicaid Spend Downs
A Medicaid spend down is a way to reduce your countable assets and become eligible for Medicaid. This can be done by spending down your assets on qualified medical expenses, such as:
- Doctor’s visits
- Hospital stays
- Prescription drugs
- Medical equipment
- Nursing home care
You can also spend down your assets by gifting them to certain individuals, such as your spouse, children, or grandchildren. However, there are limits on how much you can gift each year.
Protecting Your Home from Medicaid
There are a few ways to protect your home from Medicaid. One way is to place your home in a trust. Another way is to purchase a Medicaid annuity. A Medicaid annuity is a type of insurance policy that pays out a monthly income stream to the policyholder. The value of the annuity is not counted as an asset when determining Medicaid eligibility.
Table: Medicaid Asset Limits in New York
| Asset | Limit |
|---|---|
| Cash | $15,000 |
| Bank accounts | $15,000 |
| Stocks and bonds | $15,000 |
| Real estate (excluding primary residence) | $955,000 |
Asset Limits and Exemptions
In New York, Medicaid eligibility is determined based on an individual’s income and assets. The state imposes asset limits for individuals and couples to qualify for Medicaid benefits. If your assets exceed the limits, you may be ineligible for Medicaid, and the state may consider selling your property, including your house, to pay for the cost of your long-term care.
Asset Limits
- For individuals, the asset limit is $16,800.
- For married couples, the asset limit is $25,200.
- Additional assets may be excluded, such as a primary residence, a vehicle, and certain personal belongings.
Exemptions
The following assets are exempt from the Medicaid asset limit:
- The value of your primary residence is generally excluded from the Medicaid asset limit. However, the state may place a lien on your home to recover the cost of Medicaid benefits paid on your behalf.
- Vehicles with a value of up to $7,500 for individuals and $15,000 for couples are exempt.
- Personal belongings, such as furniture, appliances, and clothing, are exempt.
- Burial plots and funeral expenses are also exempt.
Medicaid and Your House
If you exceed the Medicaid asset limits, the state may consider selling your house to pay for the cost of your long-term care. However, there are several ways to protect your home from Medicaid’s claims:
- Transfer the ownership of your home to a family member or friend before you apply for Medicaid.
- Create a Medicaid trust to hold your assets, including your home, for your benefit.
- Purchase a Medicaid annuity, which is a financial instrument that provides you with a monthly income stream while protecting your assets from Medicaid.
Homestead Exemption Limit Property Type Exemption Limit Single-Family Home $75,000 2-Family Home $112,500 3-Family Home $150,000 4-Family Home $187,500 It’s essential to consult an attorney or a Medicaid planning expert to discuss your options and develop a strategy to protect your assets, including your home, from Medicaid’s claims.
Thanks for hanging in there through all the legalese. Hopefully, you’ve got a better understanding of the Medicaid rules concerning property ownership in New York. The takeaway is that Medicaid generally can’t take your house while you’re still living in it. Now, go enjoy the rest of your day knowing you’re one step closer to securing your home for the future. And don’t forget to check back soon for more helpful info. We’ll be here, ready to answer any questions you might have.