Montana Medicaid Lien & Estate Recovery Programs

Montana

Medicaid

Lien &

Estate

Recovery

Programs

ESTATE RECOVERY AFTER A MEDICAID

RECIPIENT’S DEATH:

Federal law requires the State of Montana to

recover Medicaid payments made on behalf of

certain Medicaid recipients after the recipient’s

death. Those Medicaid recipients subject to

recovery are:

• Residents of nursing homes;

• Residents of medical facilities or institutions

such as Montana State Hospital and

Montana Developmental Center; and

• Individuals age 55 and older at the time

they receive Medicaid-paid services.

Note: Individuals eligible under Medicaid expansion

(adults age 19-65 without children living at home who

earn 0-138% FPL and parents who earn between

50-100% FPL) are not subject to recovery except for

Medicaid-paid long term care such as nursing home

and home and community based services, as required

by federal law.

The State may recover by ﬁling a claim against

the deceased recipient’s estate for the amount

Medicaid paid on the recipient’s behalf. Recovery

may also be made by ﬁling a claim against the

estate of the deceased recipient’s spouse if the

spouse survives the recipient. Recovery from the

estate of the recipient’s spouse is limited to the

value of any property the spouse received from

the recipient by distribution or right of survivorship

and cannot exceed the amount Medicaid paid on

behalf of the deceased.

Recovery may be made from any property the

Medicaid recipient had an interest in prior to the

recipient’s death, including both real property (real

estate; land with or without improvements) and

personal property including but not necessarily

limited to:

• Property that is part of the recipient’s

probate estate;

• Property that is not part of the recipient’s

probate estate; Property that was solely

owned by the recipient; and

• Property that the recipient owned jointly

with another or others as a joint tenant or

tenant-in-common; and

• Property that was transferred by Beneﬁciary

Deed or Quit Claim Deed.

The State may recover from any person who

received property from a deceased recipient by

distribution or right of survivorship. Recovery may

be made during the lifetime of the person who

received property by distribution or survivorship or

from the person’s estate after the person’s death.

Recovery is limited to the value of the property

received from the recipient and cannot exceed the

amount Medicaid paid on behalf of the deceased

recipient.

The State cannot, however, recover from Tribal

trust property, including real property and

improvements, or from income derived from trust

resources or Tribal trust property.

The State is also entitled to receive:

• Any funds of a recipient held by a ﬁnancial

institution at the time of the recipient’s

death, such as funds in a checking or

savings account, if the recipient resided in a

nursing facility;

• Any funds of a recipient held by a nursing

facility at the time of the recipient’s death,

such as funds in a patient/resident account;

• Personal funds of a recipient held by any

LEGAL CITATIONS AND WEBSITES:

Montana Code Annotated (MCA) 53-6-165,

MCA 53-6-167, MCA 53-6-168, MCA

53-6-169, and MCA 53-6-171 through

53-6-189 and MCA 72-2-413

http://www.mtrules.org/

(For Administrative Rules of Montana)

data.opi.mt.gov/bills/mca_toc/index.htm (For

MCA)

FOR MORE INFORMATION, PLEASE CONTACT:

Third Party Liability Unit

Lien Recovery and/or Estate Recovery

P.O. Box 202953

Helena MT 59620-2953

Telephone (toll free): 1-800-694-3084

OR CALL (TOLL FREE):

Your local Information and Assistance Program at

1-800-551-3191,

The Senior and Long Term Care Division at

1-800-332-2272

You can also visit our website at:

www.dphhs.mt.gov/sltc to print out this information.

4,000 copies of this public document were published at an estimated

cost of $0.063 per copy, for a total cost of $252.00,

which includes $252.00 for printing and $0.00 for distribution.

Printed on recycled paper

SLTC-011 Revised 11/6/2016

person at the time of the recipient’s death,

if the recipient resided in a nursing facility;

and

• Unused funds from a burial/funeral contract

or fund in excess of $5,000.Medicaid

payments that will be recovered include

payments for:

• Health insurance premiums (including

Medicare premiums paid before July 1,

2009);

• Nursing home services;

• Home and community based services;

• Hospital services;

• Prescription drug services, and

• All other Medicaid covered services.

The State cannot recover Medicaid payments

for:

• Medicare premiums paid after 7/1/2009;

and

• Medicare co-insurance, co-payments and

deductibles paid after 01/1/2010 under the

Qualiﬁed Medicare Beneﬁ ciary Program

(QMB).

Example: Mr. Roberts left his only property,

a house valued at $75,000, to his son. At the

time of his death, Medicaid had paid $24,000

for his nursing home care. Other debts of Mr

Roberts’ estate for funeral bills and the costs

of probating his estate totaled $10,000. The

State received $24,000 and Mr. Roberts’ son

received $41,000 ($75,000 - $10,000 - $24,000 =

$41,000) from the estate.

Example: Mrs. Jones and her husband owned

their home worth $80,000, as joint tenants.

Mrs. Jones began receiving Medicaid beneﬁts

when she was 80 years old but never resided

in a nursing home or other medical facility

or institution. Medicaid made payments of

$50,000 on her behalf. When she died, her

one-half share in the house passed to her

husband by right of survivorship. Mr. Jones

died two years after his wife. The State of

Montana ﬁled a claim for $50,000 against Mr.

Jones’ estate but recovered only $40,000, the

value of Mrs. Jones’ property that Mr. Jones

received by right of survivorship.

Example: Mrs. Black, a widow, and her

daughter Mary owned a home worth $80,000

as joint tenants. Medicaid made payments of

$30,000 for Mrs. Black’s nursing home care.

When Mrs. Black died, her one-half share in

the house passed to her daughter by right of

survivorship. The State ﬁ

led an action against

Mary to recover Medicaid payments made for

Mrs. Black. The State recovered $30,000 from

Mary because the value of the property Mary

received by right of survivorship was more

than $30,000.

Recovery is not enforced if the State is notiﬁed

that the recipient:

• Has a surviving spouse, except the State

can recover from the estate of the surviving

spouse if the spouse dies within three years

of the recipient;

• Has a surviving child who is under age 21;

• Has a surviving child of any age who is

blind or permanently and totally disabled.

HARDSHIP: A deceased recipient’s heirs

may ask the State to waive or reduce recovery

based on undue hardship.

All requests will be

considered, and arrangements will be made if

undue hardship exists based on criteria contained

in Rule 37.82.431 of the Administrative Rules of

Montana (ARM).

Note: There is no undue hardship waiver for

recoveries from funds of the recipient held by

a ﬁnancial institution, nursing facility or other

person or from unused funds in a burial/funeral

contract or fund.

LIEN RECOVERY:

To secure recovery of Medicaid payments made,

the State may place a lien on real property

(real estate; land with or without improvements)

owned by a Medicaid recipient living in a

nursing home or other medical facility or

institution such as the Montana State Hospital

or Montana Developmental Center. A lien may

be imposed only if the recipient is permanently

institutionalized in the nursing home or other

medical facility or institution. The amount of the

lien cannot exceed the amount Medicaid paid

on behalf of the recipient.

For purposes of imposing a lien, a recipient is

considered to be permanently institutionalized

when the recipient cannot be expected to return

home.

A lien may not be imposed if the State is

notiﬁed that any of the following relatives of

the recipient is living in the home:

• The spouse;

• A child under 21;

• A child of any age who is blind or

permanently and totally disabled;

• A brother or sister who has an ownership

interest in the home and who has lived in

the home for at least 18 months before the

recipient entered the nursing home.

No lien may be imposed on Tribal trust property

and improvements (buildings or other

attachments) to Tribal trust property.

If a lien is imposed and the recipient is discharged

from the facility or institution and returns to the

home, the State will release its lien based on a

written request from the recipient.

The State may enforce its lien after the Medicaid

recipient’s death or upon the sale, transfer or

exchange of the real property or of any right, title

and interest in the property.

Example: Ms. Perez, a single adult, lived in

the nursing home for three years prior to her

death. A lien was placed on her home during

that time. Medicaid paid $67,000 on Ms. Perez’

behalf. After Ms. Perez’ death the home is sold

for $90,000, and the State’s lien in the amount

of $67,000 is satisﬁed from the proceeds of the

sale of the home.

HARDSHIP WAIVERS AND EXEMPTIONS:

The surviving spouse of a deceased recipient

who resides in and has a legal interest in a home

is entitled to an exemption from lien recovery

as provided in Rule 37.82.437, Administrative

Rules of Montana (ARM). The State may also

waive enforcement of its lien, wholly or in part, for

other individuals on the basis of undue hardship

according to the criteria contained in ARM

37.82.436.

Additionally, heirs, if they wish, can retain the

property by paying the lesser of:

• The amount the State is entitled to recover;

• The fair market value of the property.