Proper asset planning may help you obtain Medicaid coverage in the future. However, you should also know what to expect from the program following your death. The Massachusetts-run Medicaid system, known as MassHealth, has rules that allow it to claim money from the estates of some members after they pass away.
This process, called estate recovery, helps reimburse MassHealth for costs it paid to members. The state may pursue money in your bank accounts or the sales of your property, including your home if you were the sole owner. However, there are certain situations where MassHealth may not pursue estate recovery.
Delays in recovery
In some circumstances, MassHealth will delay recovery against your estate. You must have a surviving spouse, a child younger than 21 years old, or a child of any age who is blind or has some other disability.
MassHealth will delay estate recovery efforts until or unless these situations change. In other words, Massachusetts officials will wait until the death of your spouse, the reversal of your child’s disability or when your child becomes 21 to try to collect against your estate.
Hardship waivers
Sometimes heirs can avoid estate recovery altogether. One of your beneficiaries could request a hardship waiver to reduce or eliminate estate recovery in difficult circumstances. For example, the state may grant a waiver if you have an heir whose income was very low for the past two years. Waivers help avoid imposing an unfair burden on your family members.
Another common hardship involves the heir inheriting and living in the home of the deceased. If forcing the heir to sell that home would cause significant hardship, MassHealth may waive part or all of the estate recovery. The home often represents the largest asset of a family.
Estates with small value
Massachusetts also exempts states with minimal value. MassHealth skips any estate recovery efforts for estates worth $25,000 or less, as the state generally does not believe the effort to pursue recovery from such estates is worth the effort.
No matter your situation, know that MassHealth makes case-by-case determinations based on the facts. You may see if your estate qualifies for delays or waivers that protect your assets so your family will not have to worry about losing them to state claims.
