Before July 1, 2003, the state could only recover from assets, like a home, that passed through a member's probate estate. Generally speaking, the probate estate would include assets solely in the individual's name and not those owned jointly or with a designated surviving beneficiary (i.e., life insurance, Option B and C pensions).

A member could feel secure that, as long as the family homestead was not in his name alone, then it would not have to be sold to pay back Medicaid for nursing home care. However, that changed when last year's budget became law effective July 1, 2003. Beginning with nursing home residents who die on or after that date, the state can collect from any interest that a member had, immediately before their death, even if the asset is not included as part of his probate estate (section 329 of chapter 26 of the acts of 2003).

Essentially this means that property, like a home owned jointly with a spouse or in which a member may have retained a life estate, is no longer exempt. It may be subject, then or sometime in the future, to estate recovery by the state for its share of their nursing home costs.

According to the Association's Bill Hill, "If the nursing home resident is survived by a spouse or a disabled child, then the house will not be sold as long as they're living. But once they die, it can then be sold and part or all of the proceeds can be taken by the state towards the nursing home bill."

Legislation is pending that would eliminate the new law entirely (i.e., SB 2232) or reduce its overall impact (i.e., SB 2173). Unless and until that's done, members should be mindful of the new law as they plan their estate and make arrangements for possible long-term care.