UNITED STATES—Toni, I am a financial planner with a client who just received a bill for her mother’s Medicaid Long Term Care that was cared for at her mother’s house instead of a nursing home. Sue is now stuck with a $67,500 bill that Medicaid says must be paid in full. Her mother died at least 8 months ago.

She recently received a document from MERP (Medicaid Estate Recovery Program) saying that Medicaid wants all the Medicaid money used for her mother’s care returned or the state is placing a lien on the house that Sue’s mother owned when she finally passed.

What is MERP? I have never been asked about this situation and do not know what to tell my client. Thanks, Chuck.

Hello Chuck: What a great question!!  After researching MERP (Medicaid Estate Recovery Program), I found it to be very eye opening!

America needs to be aware that nothing comes without a cost!!  And it a real surprise when a Medicare beneficiary receives Medicaid Long Term Care and later the Medicaid recipient’s estate receives notification from the state of Texas for a “Notice of Intent to File a Claim against the Estate.

Medicaid can recover ANY and I repeat ANY medical expenses, not just nursing facility services or home and community based services, but also includes related hospital services, prescription drugs and even Medicare cost sharing expenses which are… Medicare premiums (Part A – hospital insurance, Part B – medical insurance), deductibles and coinsurance amounts.

Some of these services may be part of the $67K your client has to pay back to Medicaid.

You asked if the state could take her mother’s house. Yes! All claims against an estate, including MERP claims, must be paid before the property can be distributed as specified in a will. The state does not, however, require an heir to sell the deceased recipient’s homestead (house) if the claim can be paid by other funds. But if not, then you may have to sell the house, or the state will file a lien against the house.

The state does not process its own paperwork and has an outside Texas Medicaid Estate Recovery Contractor who handles the complete process. In the letter sent to the recipient’s estate it states…the amount received will not exceed the value of the estate’s assets, if any. If there is no money in the estate, then there is nothing to recover.

My advice would be to explore all of your options and maybe a family can work out a schedule to take care of your loved one or ask the church to find a volunteer or two to assist in the process. This way you can protect all that your loved ones have worked, so hard to accumulate.

Toni Says®:

  • Buy a long-term care policy while you are still in decent health
  • Put some money away for that rainy day.
  • Seek the advice of an Elder Care Attorney that can help with proper Medicaid planning Do proper planning…No one wants their kids to be their caregiver and take care of their activities of daily living such as bathing, dressing, bathroom problems, etc. But the adult children are available to make sure that their elderly parents have the best life they can as they are growing older.

Coming in October, Confused about Medicare Zoom Webinar discussing Medicare’s Annual Enrollment and what your Medicare options for fall’s Medicare Annual Enrollment can be.

Toni King, author of the Medicare Survival Guide® is giving a $5 discount on the  Medicare Survival Guide® Advanced book to the Toni Says Medicare column readers at www.tonisays.com. Have a Medicare question call 832-519-8664 or email info@tonisays.com.