Medicaid Estate Recovery Collections. FREQUENCY AND SIZE OF INDIVIDUAL RECOVERIES

09/01/2005

Data about the size and numbers of estates affected are exceedingly thin. Given the small amounts recovered compared to total Medicaid spending, it is reasonable to surmise that Medicaid estate recovery is a relatively infrequent occurrence. A study conducted in Massachusetts (a state with a higher than average collection rate, a total Medicaid population of over one million, and a Medicaid nursing home population of over 33,000)11 reports completion of the claims process for just over 1,600 claims on estates in 2003.

The change is sometimes leveled that Medicaid estate recoveries selectively target individuals with few assets, while leaving those who have the most unscathed.12 Given the strict asset limitations for Medicaid eligibility,13 one might expect the typical deceased recipient's estate to be very small, there is some limited evidence to corroborate that the estates of most Medicaid recipients are small. It also appears that relatively few higher value estates contribute a disproportionately large share to the total estate recovery collections.14

The most significant contribution to the high value of some estates is made by the homes of Medicaid recipients, since the real estate equity in a recipient's home during life is not considered during the Medicaid eligibility determination, regardless of its value. However, it may be subject to estate recovery after the recipient's death.15 Therefore, it is conceivable that some Medicaid recipients who have owned homes leave estates that are larger than expected.

It is difficult to assess the importance of the home to individual state Medicaid estate recovery programs because of their wide policy and procedural differences, with real estate accounting for about one-quarter of estate recovery collections in some states to virtually the entire amount collected by others.16, 17, 18

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