Thirty-eight thousand dollars. That is the number in the letter a Virginia family opens after their father dies, and it has almost nothing to do with the 11 days he spent in a nursing home.
Picture the sequence. A widower checks into a care facility, decides he wants to go home, and dies in his own bed a few weeks later. His children plan the funeral, locate the deed and begin discussing a sale of the house. Then the state Medicaid agency writes, asking for $38,000 from the estate.
The family does the math and it fails. Eleven days of care cannot cost that much. About the nursing home, they are right. The claim is for something else: three years of monthly premiums that Virginia Medicaid paid to his managed care plan.
What the state is allowed to count
Virginia can go after the estates of certain people who received Medicaid benefits after age 55. The house, bank accounts and other property left at death can all be reached.
For someone in a managed care plan, the state does not stop at the care he actually used. It can add up what Medicaid paid the plan each month to keep him enrolled. Those payments accumulate for years and no bill ever reaches the family. Virginia does require that members be told, at enrollment, that such payments may later land in an estate claim.
Medicare is where people get tangled. It is the federal health insurance most people get at 65, and it sends no estate-recovery bill after death. Medicaid can. States follow federal recovery rules but write many of the details, and Virginia puts managed care payments into the final tally.
Two ledgers
The payment is called capitation: a flat monthly fee. Virginia Medicaid paid his plan the same set amount every month, whether he saw specialists weekly or hardly left his recliner. Healthy month or sick month, the plan collected.
So there are two books. The family’s holds a short nursing home stay, a few prescriptions, maybe an ambulance ride. The state’s holds every recoverable month he was enrolled after 55. Only the state’s version shows up in probate.
When Virginia has to wait
Timing depends on who survives. Recovery waits until a surviving spouse has died. It also waits while a child under 21 is living, or a child of any age who is blind or disabled.
Our widower leaves no spouse. His children are grown and neither blind nor disabled. Nothing stands between the state and the estate.
What an executor can ask for
An executor facing a claim like this can start by requesting an itemized statement: each month of managed care enrollment, the capitation amount for that month, and any other recoverable services Medicaid paid separately. The breakdown can turn up months outside the recoverable period, gaps in enrollment or charges that deserve a second look.
Next, ask for the enrollment notice. Virginia requires it, so the executor should find out whether the father received it instead of assuming $38,000 settles the question.
There is also an undue hardship waiver for cases where collection would badly hurt heirs or dependents. The state gives special consideration to a home of modest value, and to a family farm or business that is the survivors’ only income-producing asset. If a waiver does not fit, the agency may accept a reasonable payment schedule, which can spare heirs a fire sale of the house.
Sources
- Dad Will Spend 11 Days in a Nursing Home Before Dying at Home. The State Will Claim $38,000 From the House, Because It Paid His Medicaid Plan a Premium for Three Years
- Medicaid
- What Could Medicaid Work Requirements Mean for SSI Applicants? | KFF
Photo: Andre Carrotflower (CC BY-SA 4.0)
