One year ago, legislation was passed in New York State that changed the definition of the estate that was subject to recovery by Medicaid. That was followed by an emergency regulation, an administrative directive, the expiration of the emergency regulation and legislation repealing the original statute. The recent history of Medicaid estate recovery has been beset with as much drama as The Perils of Pauline. It has understandably led to confusion that would benefit from clarification.
How could there be a recovery against the estate of a Medicaid recipient? The Medicaid program is means tested. A recipient is limited to resources of no more than $14,250. There is a fundamental question as to how a recipient could have a solvent estate against which Medicaid could make a recovery. However, Medicaid exempts certain resources such as retirement accounts of any amount that are in payout status or a homestead with an equity value of $786,000 or less. These exemptions explain the possibility of a viable Medicaid claim after the demise of a Medicaid recipient.
