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Can Medicaid Recover Benefits From a Life Estate?

  • October 22nd, 2019
Q
My mom and dad both have passed. In 2007, they recorded a life estate deed on their house, listing their children as beneficiaries. The life estate was done through a lawyer as part of Medicaid planning. My dad was the last to die in 2018. Now the state wants to recover benefits from the house. Can the state recover Medicaid on a 2007 life estate? 
A

The answer depends on state law, so you’ll have to consult with an elder law attorney in your state. While the federal government requires all state Medicaid programs to seek recovery of their expenses from the estates of deceased beneficiaries – usually from their home, since that’s the only valuable asset Medicaid beneficiaries are allowed to keep – some states only seek recovery against probate property and others have so-called “expanded” recovery against non-probate property. Probate property is property only in the decedent’s name that must pass through probate to go to the person’s heirs. Non-probate property includes jointly owned property, trusts, accounts with named beneficiaries and, as in your case, life estates. In states that don’t have expanded estate recovery, life estates are often used as ways to avoid both probate and Medicaid estate recovery. To find an attorney near you, go here: https://www.elderlawanswers.com/elder-law-attorneys.

For more about life estates, click here.

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Last Modified: 10/22/2019

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