Medicaid Estate Recovery

Under federal legislation passed in August of 1993, OBRA 93, the federal government mandated that the states begin estate recovery for expenditures of Medicaid dollars. Under Medicaid regulations certain assets are exempt from consideration in determining Medicaid eligibility for nursing home care.

Prior to estate recovery, a nursing home patient could retain exempt assets and pass them to his heirs following death. Under the estate recovery law, following the death of the nursing home patient who is receiving Medicaid assistance the state can force the sale of many of the exempt assets, including the principal residence, in order to repay the state for Medicaid dollars expended on the patient.

Thus, absent proper planning, Medicaid eligibility may not save family assets from being exhausted on long term care costs.