Nursing Home, Medicaid Lien

Posted by Matthew Garretson

Question:
I have a case where the plaintiff/decedent was allowed to wander in the hospital and ended up falling, fracturing a hip, having a heart attack and dying. The case is for survivor action and wrongful death. The plaintiff had been on Medicaid for several years. He was in a nursing home. I wrote to Medicaid about a lien and they wrote back saying that there is little if anything for this accident and thus, no lien. Can I rely on this letter? I thought with Medicaid you had to pay back even if not related to accident?

-New Jersey Attorney

Answer:
It may be right and sufficient with respect to Medicaid’s lien for injury-related care, but not for Medicaid’s estate recovery claim. Medicaid liens and Medicaid estate recovery (discussed below) are different - While the Medicaid lien is the proverbial “first bite of the apple,” Medicaid estate recovery may be the last. Both must be considered when resolving personal injury or other third-party liability claims.

OBRA’ 93 mandated estate recovery (MER) at the State level for certain Medicaid benefits paid after October 1, 1999. After 1993 each state adopted its own MER program. In my state (Ohio) for instance, when a Medicaid recipient dies, Ohio Medicaid (Department of Job and Family Services) notifies the Attorney General (Office of Revenue Recovery), which sends out a notice to determine if recovery of money advanced to the recipient should be recovered from the recipient’s estate assets. The stated purpose of recovery is to reduce the taxpayer's expenditures for Medicaid help for people age 55 or older by the amount of assets owned by recipients, who do not leave a surviving spouse, minor child, or totally blind, or permanently and totally disabled child. Exceptions are made if recovery would cause an undue hardship.

The heart of the Ohio Estate Recovery Program is located within R.C. § 5111.11(B), which states in relevant part: “To the extent permitted by federal law, the Department of Job and Family Services shall institute an estate recovery program under which the department shall, except as provided in divisions (C) and (D) of this section, do both of the following:1. For the costs of Medicaid services the Medicaid program correctly paid or will pay on behalf of a permanently institutionalized individual of any age, seek adjustment or recovery from the individual's estate or on the sale of property of the individual or spouse that is subject to a lien imposed under R.C. §5111.11.1;2. For the costs of Medicaid services the Medicaid program correctly paid or will pay on behalf of an individual fifty-five years of age or older who is not a permanently institutionalized individual, seek adjustment or recovery from the individual's estate.