Michigan passed an estate recovery act that became effective September 30, 2007. The
Michigan Department of Community Health is attempting to recover for long-term care benefits
that Medicaid paid on behalf of a Medicaid beneficiary, who is 55 or older, from their “estate.”
“Estate” is defined under the Estate Recovery Act to include all property and assets that
are included in the beneficiary’s Probate Estate. While bills have been introduced by our
legislature to broaden the definition of “estate” to allow recovery from more than probate assets,
this has not occurred. Recovery is still limited to assets that are subject to Probate. If there are
no assets in the probate estate, there is nothing to attach a lien.
Estate recovery claim notices go out to Michigan families after the beneficiary has passed
away. Some of the people who receive them are exempt from the claim, or there may be a
hardship waiver that can be requested. If there is a surviving spouse or a minor child, collection
of the Medicaid claim must be deferred while the spouse or minor child survives. If Medicaid is
enforcing its claim as a known creditor, then it will be entitled to what is left after estate
administration expenses, funeral costs, and an exempt property allowance.
If a personal representative disposes of estate property without paying the State of
Michigan, he (she) could be liable to the State of Michigan. It is important that family members
of loved ones receiving long term care in a nursing home meet with an Elder Law Attorney to
understand Estate Recovery. It is also important that clients meet with an Elder Law attorney to
discuss estate recovery if a claim notice is received by a family member.
Burgess and Sweeney Law, P.C. continue to advise clients on estate planning, elder law,
Medicaid planning, probate and trust administration, guardianships and conservatorships,
business law, and real estate. As a result of the constantly changing laws in these areas, the
information provided may change. We would be pleased to discuss this, or any other issues, in
more detail.
