In New York, Medicaid can seek reimbursement from your settlement if you received Medicaid benefits while you were injured. The amount Medicaid can take depends on several factors, including the type of settlement, the amount of your medical bills, and the length of time you received Medicaid benefits. Generally, Medicaid can take up to the amount it paid for your medical care. However, there are limits on how much Medicaid can take from structured settlements, which are paid out over time. If you are concerned about Medicaid taking money from your settlement, you should speak to an attorney who specializes in personal injury cases.
Medicaid Estate Recovery Program in New York
The Medicaid Estate Recovery Program (MERP) is a program that allows the state of New York to recover the cost of Medicaid benefits provided to individuals who have died and have estates valued at more than $10,000. The program is designed to ensure that the state is reimbursed for the cost of providing Medicaid benefits, while also protecting the rights of heirs and beneficiaries.
Eligibility for MERP
- The deceased individual must have received Medicaid benefits.
- The deceased individual must have died on or after January 1, 1997.
- The deceased individual’s estate must be valued at more than $10,000 after deducting certain allowable expenses.
Assets Subject to MERP
- Real estate
- Bank accounts
- Stocks and bonds
- Retirement accounts
- Life insurance policies
- Personal property
Exempt Assets
- A home occupied by the surviving spouse, child under 21, or disabled child of the deceased individual.
- A vehicle used by the surviving spouse, child under 21, or disabled child of the deceased individual.
- Personal property and household goods up to a certain value.
- Life insurance policies with a face value of less than $10,000.
MERP Claim Process
After an individual has died, the New York State Department of Health (DOH) will file a claim against the deceased individual’s estate for the cost of Medicaid benefits provided. The claim will be filed with the Surrogate’s Court in the county where the deceased individual resided.
The DOH will send a notice of the claim to the executor or administrator of the estate. The executor or administrator will have 60 days to file an objection to the claim. If an objection is filed, the DOH will hold a hearing to determine the validity of the claim.
Payment of MERP Claims
If the DOH’s claim is upheld, the estate will be required to pay the amount of the claim. The claim may be paid from the estate’s assets or from the proceeds of the sale of estate property.
If the estate does not have sufficient assets to pay the claim, the DOH may seek to recover the claim from the deceased individual’s heirs and beneficiaries. However, heirs and beneficiaries are not personally liable for the deceased individual’s Medicaid debt.
| Asset | Exempt |
|---|---|
| Home occupied by surviving spouse, child under 21, or disabled child | Yes |
| Vehicle used by surviving spouse, child under 21, or disabled child | Yes |
| Personal property and household goods up to $10,000 | Yes |
| Life insurance policies with a face value of less than $10,000 | Yes |
| Real estate | No |
| Bank accounts | No |
| Stocks and bonds | No |
| Retirement accounts | No |
| Life insurance policies with a face value of $10,000 or more | No |
| Personal property and household goods over $10,000 | No |
Treatment of Personal Injury Settlements
Medicaid is a government program that provides health insurance to low-income individuals and families. When a Medicaid recipient receives a personal injury settlement, the settlement may be considered an asset or income. If the settlement is considered an asset, Medicaid may place a lien on the settlement, which means that Medicaid can claim reimbursement for past and future medical expenses. If the settlement is considered income, Medicaid may reduce the recipient’s benefits by the amount of the settlement.
Calculating Medicaid’s Lien
If Medicaid places a lien on a personal injury settlement, the amount of the lien will be equal to the total amount of Medicaid benefits that the recipient has received since becoming eligible for Medicaid. The lien will be reduced by any amount that the recipient has already paid back to Medicaid, and it will be extinguished once the recipient has paid back all of the benefits that they received.
How Long Does Medicaid Have to Place a Lien?
Medicaid has six years from the date that the recipient receives a personal injury settlement to place a lien on the settlement. If Medicaid does not place a lien within six years, the lien will be extinguished, and Medicaid will not be able to claim reimbursement for past or future medical expenses.
Protecting Your Settlement from Medicaid’s Lien
There are a few things that you can do to protect your personal injury settlement from Medicaid’s lien.
- Spend the settlement quickly and use it for things that are not considered assets, such as paying off debts, buying a home, or paying for medical expenses.
- Invest the settlement in assets that are not considered countable assets, such as a retirement account or a life insurance policy.
- Create a special needs trust for the settlement. A special needs trust is a legal document that allows you to set aside money for your future medical expenses without disqualifying yourself from Medicaid.
If you are a Medicaid recipient and you receive a personal injury settlement, it is important to contact a Medicaid attorney to discuss how to protect your settlement from Medicaid’s lien.
| Medicaid Lien | Medicaid Reduction in Benefits | |
|---|---|---|
| Settlement is considered an asset | Medicaid may place a lien on the settlement | No |
| Settlement is considered income | No | Medicaid may reduce the recipient’s benefits by the amount of the settlement |
Calculating Medicaid Recovery Amounts
In New York, Medicaid may file a claim against personal injury settlements to recover payments made on the claimant’s behalf. The amount that Medicaid can take from a settlement is calculated using a formula based on several factors, including the total settlement amount, the claimant’s medical expenses, and the amount of Medicaid benefits paid.
Factors Used to Determine Recovery Amount
- Total settlement amount
- Claimant’s medical expenses
- Amount of Medicaid benefits paid
- Date of the accident
- The claimant’s age and disability status
- Date of Medicaid’s notice of lien
- Whether the settlement includes lost wages or other damages
In general, Medicaid will take a proportionate share of the settlement that is equal to the percentage of medical expenses that Medicaid covered.
Example
If the total settlement amount is $100,000, the claimant’s medical expenses were $50,000, and Medicaid paid $25,000, Medicaid could potentially recover up to $12,500 from the settlement (25,000 / 50,000 * 100,000 = 12,500).
Statutory Liens
In New York, Medicaid has a statutory lien on any personal injury settlement that includes compensation for medical expenses.
Filing a Claim
Medicaid will file a claim against the settlement within 18 months of receiving notice of the settlement from the claimant or the claimant’s attorney.
Negotiating with Medicaid
It is possible to negotiate with Medicaid to reduce the amount of the recovery claim. The claimant or their attorney can submit documentation to Medicaid that shows that the claimant has other assets or sources of income that can be used to pay for medical expenses.
In some cases, Medicaid may agree to waive or reduce the recovery claim if the claimant is experiencing financial hardship.
Protect Your Settlement
To protect your settlement from Medicaid recovery claims, you should take the following steps:
- Notify Medicaid of the settlement as soon as possible.
- Keep careful records of all medical expenses.
- Consult with an attorney to discuss your options for negotiating with Medicaid.
| Settlement Amount | Medical Expenses | Medicaid Benefits Paid | Medicaid Recovery Amount |
|---|---|---|---|
| $100,000 | $50,000 | $25,000 | $12,500 |
| $200,000 | $100,000 | $50,000 | $25,000 |
| $300,000 | $150,000 | $75,000 | $37,500 |
Potential Impact on Your Settlement
If you receive a settlement from a personal injury lawsuit or other legal action, Medicaid may seek reimbursement for the benefits it paid on your behalf during the time your case was pending. The amount Medicaid can take from your settlement depends on several factors, including:
- The amount of the settlement.
- The amount of Medicaid benefits paid on your behalf.
- The type of Medicaid benefits you received.
- Your state’s Medicaid laws.
In some cases, Medicaid may take the entire amount of your settlement. In other cases, you may be able to keep a portion of your settlement after Medicaid has been reimbursed.
To find out how much Medicaid can take from your settlement, you should contact your state’s Medicaid office. You can also get help from a lawyer who specializes in Medicaid law.
Understanding How Medicaid Seeks Reimbursement from Settlement
Medicaid seeks reimbursement from settlements through a process known as “third-party liability.” Under this process, Medicaid can seek reimbursement from any third party who is responsible for causing or contributing to your medical expenses.
In the case of a personal injury settlement, Medicaid may seek reimbursement for the medical expenses it paid on your behalf that are related to the injury that was the subject of the lawsuit.
Steps to Protect Your Settlement from Medicaid
There are several steps you can take to protect your settlement from Medicaid, including:
- Establish a Special Needs Trust: A special needs trust is a legal document that can be used to hold your settlement funds. The trust can be structured to ensure that the funds are not considered available assets for Medicaid purposes.
- Purchase an annuity: An annuity is a financial product that can provide you with a steady stream of income for a period of time. Annuities are often considered exempt assets for Medicaid purposes.
- Pay Off Debt: Using your settlement to pay off debt can help reduce your countable assets and make you less likely to be eligible for Medicaid.
Create a Realistic Budget
To protect your settlement, you need to create a realistic budget. This means tracking your income and expenses so that you know where your money is going. Once you have a budget, you can start making changes to reduce your expenses and save money.
Seek Legal Advice
If you are concerned about Medicaid taking your settlement, it’s important to seek legal advice. A lawyer can help you understand your rights and options and can help you develop a plan to protect your settlement.
| State | Medicaid Reimbursement Policy |
|---|---|
| California | Medicaid can seek reimbursement from settlements for medical expenses paid on behalf of the recipient. |
| Florida | Medicaid can seek reimbursement from settlements for medical expenses paid on behalf of the recipient. |
| New York | Medicaid can seek reimbursement from settlements for medical expenses paid on behalf of the recipient. |
| Texas | Medicaid can seek reimbursement from settlements for medical expenses paid on behalf of the recipient. |
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