Medicaid Recovery of Home Catches Many Families by Surprise

States are becoming more aggressive about collecting reimbursement for Medicaid nursing home care, and families of deceased recipients are often stunned to discover that the state has laid claim to the family home, according to a recent article in The Christian Science Monitor.

The article, on the federally mandated practice known as Medicaid estate recovery, reports that state Medicaid authorities often target the home because it's all that's left after beneficiaries have qualified for Medicaid coverage of nursing home care.

No estate recovery can take place until the death of the recipient's spouse, or as long as there is a child of the deceased who is under 21 or who is blind or disabled. Still, states go after assets like the home in a variety of ways, producing confusion, anger, and even lawsuits, according to the article. And the advance notice given to families that the home could later be seized if they accept Medicaid coverage is sometimes inadequate.

"It's fine that these programs are required by federal law, but people need to know the rules of the game," says Wendy Fox-Grage, policy adviser with the AARP Public Policy Institute. "We're concerned that families are not being notified."

AARP is so concerned that it has commissioned the American Bar Association to study consumer protections in this area, Fox-Grage says. Results are expected this spring.

Others worry that fears of losing their homes will discourage some from seeking health care. "Our concern is that people will say, 'I don't want my husband to go to the nursing home because then the government will take my house,' " says Tim Takacs, an elder law attorney in Nashville, Tennessee.

To read the Christian Science Monitor article, "A Flap over Recouping Costs of Medicaid," click here.

For more on Medicaid estate recovery, click here.