An old law and the Affordable Care Act clash

by | Apr 22, 2015 | Long-Term Care Planning |

Eleven million people used the Affordable Care Act (ACA) to obtain needed health coverage. However, it now appears that there was an unexpected side-effect for some people, due to an old law that is still on the books.

This law is known as the estate recovery law. If patients pass away before turning 55, nothing happens. Once they break that age threshold, though, the state may be able to attempt to recover some of those Medicaid costs. Many people did not know that this would be possible, and it can cause a serious problem for family members when the state asks for the money back.

Not everyone falls under this law, even if they are over 55. It is possible for some people to get hardship exemptions, and those who are disabled are not included.

This law was actually passed back in 1993. It’s just that many people did not know it had been passed until the ACA began providing health care to those under a certain income level. After all, only those who fall under this income level can collect Medicaid at all. The level does change every year, based on the poverty line in the United States, but it’s set at $16,245 this year.

According to some reports, the problem isn’t just that people did not know about the law and signed up in ignorance. Some of them may actually have been provided with false information that kept them from finding out about the legal ramifications of the ACA.

For long-term care planning and medical care, make sure that you really know the full scope of the law before signing up for anything in New York.

Source: CBS Moneywatch, “An unexpected after-death side effect of Obamacare,” Aimee Picchi, April. 13, 2015