Did you know you have to repay the Medicaid benefits you receive?

by | Jul 27, 2021 | Long-Term Care Planning |

Many people in New York won’t qualify for Medicaid right away when they need medical care. Even after their income drops or ends abruptly, they may still have personal property that exceeds the limit for Medicaid applicants.

Thankfully, certain assets, like the home in which you live, won’t count against you for qualification purposes. However, just because you started receiving benefits doesn’t mean Medicaid can’t still come after you in the future.

There is an expectation that those with assets will repay the benefits they receive from Medicaid. How does New York try to collect money from Medicaid recipients after they receive benefits?

New York’s Medicaid estate recovery program could consume your legacy

When someone dies after receiving Medicaid benefits, the state will generally try to claim whatever property they leave behind. Everything from the remaining balance in your checking account to the house that you lived in could be vulnerable to claims by the Medicaid recovery program.

While your primary residence does not count against you when you need to qualify for Medicaid, the state can and likely will make a claim against the home after you die. Only in rare cases will the state defer such recovery efforts. If you have a sibling or adult child living in the house with you at the time of your death, it may prevent the state from taking action against your home.

In most other cases, unfortunately, the New York Medicaid estate recovery program will try to take much as possible from your estate, including the house that you own.

Medicaid planning can help people protect their legacies

People should not have to decide between leaving something for their loved ones and receiving the care they need in the golden years after a sudden, drastic change in their health. Planning ahead to qualify for Medicaid might include leaving strategic gifts to people or moving major assets like a home into a trust. Property not in your full name will be harder for the state of New York to make claims against after you die.

The more you understand about how Medicaid works in New York, the easier it will be for you to navigate the complex benefits system in your time of need.