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medicaid payback regulations

As the heartwrenching effects of Medicaid payback regulations have become more prevalent, lawmakers are once again taking action. Recent reports from The New York Times and Associated Press shed light on how estate recovery impacts family members of the deceased, and why the practice should end.

To help you manage any estate planning matter related to Medicaid or long-term care, seek advice from an elder law attorney. Professionals in this expertise are equipped with tools, guidance, and knowledge to secure your assets for the future. Additionally, preparing for financial circumstances, such as Medicaid payback regulations, better protects your family and survivors after your passing.


Medicaid, a government-funded program, provides healthcare coverage for low-income individuals in the United States. Eligibility for Medicaid is determined by income status and asset criteria, typically capped at $2,000 in most states.

For many elderly Americans requiring long-term care, Medicaid is a crucial resource to offset medical costs. It’s important to note that Medicare, another government health program, does not cover long-term care services.

Data from 2023 highlights the considerable costs of nursing home care, with the median monthly expense for a semi-private room nearing $9,000 nationwide. Most individuals are unable to sustain this monthly cost for an extended amount of time. Consequently, they often resort to depleting their assets just to meet Medicaid eligibility requirements.

How Does Medicaid Estate Recovery Work?

Under federal regulations, states must pursue reimbursement for medical expenses incurred by Medicaid recipients throughout their lives. These expenses can come from various services, such as nursing home care, prescriptions, and long-term medical support. Specifically targeting Medicaid beneficiaries 55 and over, the Medicaid Estate Recovery Program is in place to account for these costs.

In most cases, states will initiate the process of recovering funds from an individual’s estate following their death. Failure to do so puts the state at risk of forfeiting its federal Medicaid funding. This is why it’s important to have measures in place that protect your assets prior to receiving Medicaid benefits.

Can Medicaid Legally Take Away Your Home?

In many states, only the assets that are included in your probate estate are subject to Medicaid payback regulations. For example, if you designate a beneficiary for your life insurance policy, those funds will likely bypass probate proceedings. However, your home might be your primary asset, and if you haven’t taken precautions to shield it from estate recovery, a lien could be placed on it.

The impact of the Medicaid Estate Recovery Program’s financial burdens can be overwhelming for grieving families. As states pursue reimbursement for long-term Medicaid recipients, it is often family members with limited income who are affected most. In some cases, survivors may even face the loss of their homes or have to file for bankruptcy.


In March of 2024, U.S. Rep. Jan Schakowsky (D-IL) reintroduced legislation to end Medicaid estate recovery altogether. The “Stop Unfair Medicaid Recoveries” Act would primarily bar states from placing liens on the homes of Medicaid recipients.

“This current system … is ineffective and unjust, and it must end,” Schakowsky stated in a press release. “Let’s give our seniors and their families dignity and peace of mind.”

The bill would also provide additional healthcare support and access to long-term care services. According to the Times report, a nonpartisan agency revealed that most states recovered less than 1% of their Medicaid expenditures for long-term care in 2019.

A number of advocacy groups have also expressed support for making changes to the current Medicaid payback regulations. At this time, the bill is not guaranteed for approval or expected to pass in the near future.


Navigating estate recovery and Medicaid payback regulations may never be something you have to deal with. However, statistically 7 out of 10 elderly individuals are expected to need financial assistance for healthcare in their lifetime.

Because Medicaid benefits vary by state, it is highly recommended that you consult with a lawyer or elder law attorney. Elder law professionals can help you apply for benefits, protect your assets, and plan for affordable end-of-life care.

Bromlow Law, PLLC and Laura L. Bromlow, are dedicated to the practice of Elder Law and Estate Planning. Our practice focuses solely on working with clients in these and closely related legal fields. Laura L. Bromlow is a Certified Elder Law Attorney with the National Elder Law Foundation. Bromlow Law, PLLC strives to enhance communication among family members and loved ones and to keep them all out of conflict so they can stay out of court. We want to help you keep your close circle safe!

Please contact our office today at (281) 665-3807 to schedule a free consultation to discuss your legal matters. We look forward to the opportunity to work with you.

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