How to Avoid MassHealth Estate Recovery and Protect Your Assets

MassHealth Estate Recovery can be a daunting topic, but understanding the basics can help you protect your assets. You've paid taxes and premiums for years, and it's only fair that you want to keep what's yours.

Massachusetts has a program in place to recover costs from estates that received MassHealth benefits. This program is known as MassHealth Estate Recovery. It's essential to know that MassHealth Estate Recovery only applies to estates with assets above the exemption threshold.

To avoid MassHealth Estate Recovery, you can take proactive steps. One way to do this is by understanding the asset transfer rules.

MassHealth estate recovery is a process where the state seeks to recover the cost of benefits paid out on behalf of a MassHealth member after their death. This can include assets such as funds in bank accounts or proceeds from the sale of real estate or personal property.

If you apply for and receive Medicaid benefits after age 55 and/or for care in a skilled nursing facility at any age, MassHealth may seek to recover the cost of benefits paid out on your behalf. This can be a significant concern for many people.

The Estate Recovery Unit can only recover from assets in your sole ownership at the time of your death. However, if the MassHealth claim is greater than the probate estate of a prior MassHealth member, MassHealth will not pursue an "unsatisfied" claim.

Careful long-term care planning can help minimize the assets that are subject to estate recovery. In fact, with proper planning, the only remaining assets in your name may be valued at less than $2,000.

Recent revisions in the law have expanded the criteria for estate recovery waivers and no longer pursue recovery of assets in any estate valued at less than $25,000. This is a positive development for many people.

Protecting your home and assets is crucial when planning for long-term care. You can transfer your home to the spouse who is not seeking MassHealth benefits to protect it from estate recovery.

MassHealth will not force a spouse to sell or move out of their home as long as the MassHealth application is completed correctly. Currently, a principal residence with less than $955,000 in equity is not countable for the purposes of calculating the assets of a MassHealth applicant's spouse.

Transferring your assets into a trust can also help protect them from Medicaid recovery. In Florida, only probatable assets are subject to Medicaid recovery, and probatable assets are owned solely in your name or in the name of your estate.

To avoid Medicaid getting a hold of these assets, you can take them out of your name by placing them in a Family Asset Protection Trust or a Medicaid Five Year Trust. This is because Medicaid has a "look back" period of five years, and moving these assets into a protected trust long before you anticipate the need for Medicaid can go a long way toward protecting your family.

If a MassHealth member receiving benefits in a skilled nursing facility is the sole owner of real estate, a lien may be placed on the property if there's no exempt person living in the home and no expectation of returning home.

A lien on a property can trigger the sale of real estate to repay MassHealth for benefits paid out on the member's behalf, using the sale proceeds to do so.

Family members living in the home since before the MassHealth member's death may be able to delay the claim or have an alternative method of repayment considered.

MassHealth may also consider a hardship or other waiver in certain circumstances, but releasing a lien does not prevent an estate recovery effort.

If a lien is placed on a property and it's later sold, transferred, or refinanced, the sale proceeds must be used to repay MassHealth for benefits paid out on the member's behalf.

MassHealth may seek to recover the cost of benefits paid out on your behalf after your death, but only from assets in your sole ownership at the time of your death.

The assets that can be recovered include funds in bank accounts or proceeds from the sale of your real estate or personal property, but not assets held jointly with others.

MassHealth will not pursue an "unsatisfied" claim if the MassHealth claim is greater than the probate estate of a prior MassHealth member, and will only recover funds after certain other debts have been cleared.

In some instances, estate recovery can be delayed, waived, or reduced, such as when there is a surviving spouse, a disabled child, or a child under 21 years old, or when an heir meets the necessary low-income and/or caretaker criteria.

MassHealth is the Massachusetts Medicaid program, providing health care coverage to over 2.8 million residents, including low-income adults, children, pregnant women, and people with disabilities.

The program is administered by the Massachusetts Executive Office of Health and Human Services.

MassHealth covers a wide range of services, including doctor visits, hospital stays, prescriptions, and preventive care.

You can apply for MassHealth online, by phone, or in person at your local Community Health Center.

The application process typically takes 30 days to complete, but can be expedited in emergency situations.

MassHealth offers several different types of coverage, including MassHealth Standard, MassHealth Limited, and MassHealth CommonHealth.

Each type of coverage has its own eligibility requirements and benefits.

MassHealth is a vital resource for many Massachusetts residents, providing access to essential health care services.

MassHealth Recovery is a process that can be triggered by receiving Medicaid benefits after age 55 or for care in a skilled nursing facility at any age. The state will seek to recover the cost of benefits paid out on your behalf.

MassHealth can only recover from assets in your sole ownership at the time of your death. This means that if you have joint assets or assets held in a trust, they may not be subject to estate recovery.

The state will not pursue an "unsatisfied" claim if the MassHealth claim is greater than the probate estate of a prior MassHealth member. This means that if the estate is unable to pay the claim, the state will not continue to pursue it.

Estate recovery can be delayed, waived, or reduced in certain instances, such as when there is a surviving spouse, a disabled child, or a child under 21 years old. This provides some protection for family members who may be relying on the estate for support.

In some cases, estate recovery can be avoided altogether by having long-term care planning in place. This can involve transferring assets to a spouse or other family members, or using other strategies to minimize the value of the estate.

Recent revisions in the law have expanded the criteria for estate recovery waivers and now no longer pursue recovery of assets in any estate valued at less than $25,000. This change provides some relief for families who may have been at risk of losing assets to estate recovery.

With careful long term care planning, it is likely that the only remaining assets in the name of a MassHealth recipient in a skilled nursing facility would be valued at less than $2,000 and, therefore, those would be the only assets subject to estate recovery.

To avoid estate recovery, you can also consider consulting an elder law attorney who can help you obtain long-term care, assist with asset protection, and draft an estate plan that leaves a legacy for your surviving loved one.

Recent revisions in the law have made it easier to avoid estate recovery, as the Estate Recovery Unit no longer pursues recovery of assets in any estate valued at less than $25,000.

Consulting an elder law attorney can be a crucial step in avoiding estate recovery. They can help you navigate the complex Medicaid system and create a plan that protects your assets.

Medicaid has a five-year "look back" period, meaning that if you transfer assets into a protected trust at least five years prior to applying for Medicaid, they won't be subject to recovery.

You don't have to have five years to wait, however. An experienced elder law attorney can help you obtain long-term care benefits while also protecting your assets within a shorter timeframe.

Jason, an elder law attorney, received his Juris Doctor from the University of Miami — School of Law and is a member of the Florida Bar and the Broward County Bar Association. He has received numerous accolades for his work.

Having an estate plan in place can also ensure that your assets are distributed according to your wishes, rather than default state laws. This can help prevent Medicaid from coming after your property when you're gone.

If you're the personal representative of your loved one's estate and worried about having it depleted by Medicaid, you may be able to apply for an Undue Hardship Waiver Request.

To qualify for hardship, you would have to show Medicaid that at least one of the following is true:

Actually getting Medicaid to accept your claim for hardship is rare and may not be an option for most people.