The Atlantic Profiles Less Discussed Asset Recovery in Medicaid

ANCOR is sharing this article by The Atlantic because it highlights an overlooked side of long term supports and services (LTSS). Specifically, it focuses on Medicaid Estate Recovery Program, which allows states to seize estates of deceased Medicaid recipients.

As written by The Atlantic:

“Medicaid, the government program that provides health care to more than 75 million low-income and disabled Americans, isn’t necessarily free. It’s the only major welfare program that can function like a loan. Medicaid recipients over the age of 55 are expected to repay the government for many medical expenses—and states will seize houses and other assets after those recipients die in order to satisfy the debt.

[…]

Defenders of estate recovery see it both as a way to control the high costs of long-term care and as a necessary check on those who could pay for such care but would rather the government foot the bill. (Nursing homes cost $89,000 a year, on average, for a semiprivate room.) Medicaid, Salo told me, is already struggling to meet the needs of the poorest Americans. Should it also cover long-term care for ‘someone who’s going to pass hundreds and hundreds of thousands of dollars of assets on to their family?’

But the overwhelming majority of estates are not worth hundreds of thousands of dollars. In 2005, the Public Policy Institute of the AARP published a study of the first decade of mandatory estate recovery. Massachusetts, it found, recovered an average of $16,442 per estate in 2003, in total offsetting a little more than 1 percent of its long-term-care costs that year. That made its efforts among the most effective in the nation. In Kentucky, by contrast, the average amount collected from an estate was $93; the state recovered just 0.25 percent of its long-term-care costs. The total amount states recouped jumped from $72 million in 1996 to $347 million seven years later—but even so, estate recoveries accounted for less than 1 percent of Medicaid’s total nursing-home costs in 2003.

Opponents of estate recovery say that the harm of destabilizing low-income families does not justify the meager returns. ‘It’s a drop in the bucket given the amount of misery they cause people,’ says Patricia McGinnis, the executive director of the California Advocates for Nursing Home Reform, which co-sponsored successful 2016 legislation to limit the assets Medicaid can recover in California.”

ANCOR note on the above: interested readers can learn more about Medicaid asset recovery in this article.