In order to understand Medicaid qualification, you first need to know how Medicaid treats your assets. Basically, Medicaid breaks your assets down into two separate categories. The first are those assets which are exempt and the second are those assets which are non-exempt or countable.

Exempt [...]]]> By Kim Boyer
Elder Law News
July 2006 (updated)

In order to understand Medicaid qualification, you first need to know how Medicaid treats your assets. Basically, Medicaid breaks your assets down into two separate categories. The first are those assets which are exempt and the second are those assets which are non-exempt or countable.

Exempt assets are those which Medicaid will not take into account. Generally, the following assets are exempt:

• The home, which must be the principal place of residence. The nursing home resident must indicate an “intent to return home,” even if this never actually takes place. Equity in homes of nursing home residents exceeding $500,000 shall be countable unless the nursing home resident’s spouse, child under age 21, or blind or disabled child is living in the residence.
• Household and personal belongings, such as furniture, appliances, jewelry and clothing.
  One vehicle.
• Burial accounts of $1,500. Burial spaces and markers, and prepaid funeral plans meeting specific requirements.
• Cash value of life insurance policies, as long as the face value of all policies added together does not exceed $1,500. If it does exceed $1,500 in total face amount, then the cash value in these policies is countable. Also, term life insurance is exempt.
• Cash not to exceed $2,000.

Keep in mind that Medicaid may come back and attempt to recover from the estate of a Medicaid recipient after the death of the recipient and the recipient’s spouse. All other assets which are not exempt are countable. This includes checking accounts, savings accounts, certificates of deposit, money market accounts, stocks, mutual funds, bonds, IRAs, pensions, second cars and so on. While there are some exceptions to these rules for the most part, all money and property, as well as any item that can be valued and turned into cash is a countable asset, unless it is one of those listed earlier as exempt.

Of course, there are things that can be done to protect assets beyond these levels, such as the at-home spouse petitioning the Court to increase the amount of assets he or she can keep.

Back to Articles

When applying for Medicaid, the state will “look back” five (5) years to see if any gifts have been made. The state will not let you just give away your property or your money to qualify for Medicaid. Any gifts or transfers for less than fair market [...]]]> By Kim Boyer
Elder Law News
July 2006

When applying for Medicaid, the state will “look back” five (5) years to see if any gifts have been made. The state will not let you just give away your property or your money to qualify for Medicaid. Any gifts or transfers for less than fair market value that are made during the “look back” period may cause a delay in Medicaid eligibility.

At the time of application, the Medicaid agency combines all the gifts that fall within the “look back” and divides the amount by $4,583 per month. The result is the number of months the applicant is ineligible for Medicaid benefits.

On February 8, 2006, the Deficit Reduction Act (“DRA”) was enacted, changing Medicaid rules. For gifts made before February 8, 2006, the ineligibility period begins when the gift was made. For gifts made on or after February 8, 2006, the ineligibility period begins when the applicant is in a nursing home and is otherwise eligible for Medicaid except for having made the gift.

Here are some case scenarios. The question is: “When will the following individuals become eligible for Medicaid benefits?”

CASE 1: Maxine gave $100,826 to her son 12 months ago. Answer: Maxine will not be eligible for 22 months from the date of the gift (i.e. $100,826 divided by $4,583 per month equals 22 months.) The gift was made before the DRA so the disqualification period begins when she made the gift.

CASE 2: Betty gave $100,826 to her son 2 months ago. Answer: Like case #2, the disqualification period is 22 months. Unlike case #2, the gift was made after the DRA so the disqualification period begins when Betty enters a nursing home, applies for Medicaid, and is otherwise eligible for Medicaid, except for having made that gift.

CASE 3: Vera gives all of her money ($45,830) to her daughter today. Vera enters the nursing home tomorrow and applies for Medicaid benefits. Answer: Vera will not be eligible for 10 months (i.e. $48,830 divided by $4,583 per month equals 10 months).

CASE 4: In June 2001, Gordon gave his son $120,000. Gordon enters a nursing home tomorrow and applies for Medicaid benefits. Answer: Gordon is eligible for Medicaid immediately. Gordon’s gift is not in the 5-year look-back period, as it expired in May 2006.

CASE 5: In July 2003, Harold puts his daughter’s name on his house worth $146,656. Harold enters a nursing home tomorrow and applies for Medicaid benefits. Answer: Adding his daughter’s name to the deed is considered a gift of one-half the value, or a gift of $73,328. This results in a penalty of 16 months from the date of the gift. This gift occurred during the look-back period; however, the disqualification period has expired and Harold is eligible for Medicaid.

Obviously, the gifting rules can be complicated at times, and there are various exceptions to the gifting and transfer rules. The penalty divisor also changes periodically. As always, it is important to consult a knowledgeable elder law attorney for advice.

Disclaimer: This information is for general informational purposes only and does not constitute legal advice. For specific questions, you should consult a qualified attorney.

Back to Articles

The Veterans Administration (VA) has various programs to help elderly and disabled veterans. In some cases, these VA benefits can supplement Medicaid benefits. Nevada Medicaid requires applicants to apply for and pursue available benefits, such as VA medical benefits or Aid and Attendance. If a Medicaid applicant [...]]]> By Kim Boyer
Elder Law News
September 2006

The Veterans Administration (VA) has various programs to help elderly and disabled veterans. In some cases, these VA benefits can supplement Medicaid benefits. Nevada Medicaid requires applicants to apply for and pursue available benefits, such as VA medical benefits or Aid and Attendance. If a Medicaid applicant fails to apply for these benefits, the application can be denied.

Medical Benefits. The medical benefits package is a health benefits plan available to enrolled veterans. Budgetary constraints make it necessary for the VA system to provide benefits based on a priority system. Upon enrollment, veterans are placed into priority groups, which then determine the types of services available to the veteran. Some of the benefits available include prescription drugs, home health services, and hospice care.

Under a rule adopted in 2002, the VA will grant a priority level to “severely disabled” veterans, even if the immediate health problem needing attention is unrelated to their military service.

Nursing Home Care. The VA has contracts with non-VA community nursing homes, such that veterans in the special entitlement category can receive care at VA expense. Eligibility for this benefit is extremely limited.

Another potential benefit for veterans and their spouses is access to residency in the Nevada State Veterans Home, 100 Veterans Memorial Drive, Boulder City, Nevada. The private pay rate at that facility for a veteran is less than the cost of a community nursing home.

Aid and Attendance. A benefit provided by the VA that is often overlooked is called “Aid and Attendance.” This benefit can be an excellent source of funds for long-term care for the elderly, either at home or in a facility.

It is available to certain wartime veterans or their dependents who are totally disabled because of a non-service connected condition, who are in financial need, and who need the aid and attendance of another person in order to avoid the hazards of the daily environment. Under this program, the amount received will vary, and it is an add-on to the basic pension program.

Official Dates of Recent Wars:

• World War II: December 7, 1941-December 31, 1946.
• Korean War: June 27, 1950 – January 31, 1955.
• Vietnam War: August 5, 1964 (February 28, 1961 for those who were in Vietnam) to May 7, 1975.
• Persian Gulf War: August 2, 1990 to date to be determined.

The VA offers many essential services, with detailed guidelines governing access to them. This is only a brief summary of benefits available to veterans. For further information, contact any VA regional office, view their website at www.va.gov, or call 1-800-827-1000.

Disclaimer: This information is for general informational purposes only and does not constitute legal advice. For specific questions, you should consult a qualified attorney.
Back to Articles

On February 8, 2006, the federal government passed the Deficit Reduction Act of 2005, which changed the Medicaid rules. A summary of the changes and how they are implemented in Nevada follows:

Increases the Lookback Period to Five Years. All transfers will be subject to a five-year lookback period rather than the [...]]]> By Kim Boyer

On February 8, 2006, the federal government passed the Deficit Reduction Act of 2005, which changed the Medicaid rules. A summary of the changes and how they are implemented in Nevada follows:

Increases the Lookback Period to Five Years. All transfers will be subject to a five-year lookback period rather than the prior three-year lookback period for individuals, and five years for transfers to trusts.

Postpones the Penalty Period Start Date. For transfers occurring before February 8, 2006, the penalty period begins on the first day of the month of the transfer. For transfers occurring on or after February 8, 2006, the penalty period does not begin until the individual moves to the nursing home and the person would be eligible for Medicaid; meaning, until they have spent down to $2,000. In other words, the penalty period does not begin until the nursing home resident is out of funds, and she cannot afford to pay the nursing home.

An example should help explain how this works. Let’s assume that Ms. Brown transfers $45,830 to her children on February 1, 2006. Ms. Brown enters a nursing home December 1, 2006, and has less than $2,000 in her name. The penalty period is 10 months, which is calculated by taking the amount of the gift and dividing by the current divisor in Nevada, which is $4,583. The 10-month penalty period begins to run on February 1, 2006, and ends on December 1, 2006.

Now let’s assume the Ms. Brown transfers $45,830 to her children on February 9, 2006. The penalty period is still 10 months, but the penalty period does not begin to run until December 1, 2006, the date she enters the nursing home and has less than $2,000 in her name. Ms. Brown would not be not eligible for Medicaid for 10 months from December 1, 2006. This, of course, raises the question of how her care will be paid during the10-month penalty period.

Annuity Changes. The purchase of an annuity shall be considered a disposal of assets for less than fair market value unless the state is named the remainder beneficiary for at least the total amount of medical assistance paid on behalf of the annuitant. A spouse, minor, or disabled child may be named as the primary beneficiary, but the state must be named as the secondary beneficiary.

Limits Equity in Residences. The equity in the primary place of residence of a nursing home resident exceeding $500,000 shall be countable, unless the nursing home resident’s spouse, child under age 21, or blind or disabled child is living in the residence.

Disclaimer: This information is for general informational purposes only and does not constitute legal advice. For specific questions, you should consult a qualified attorney.

Back to Articles

Despite the numerous restrictions the Deficit Reduction Act (hereinafter DRA) has placed on Medicaid eligibility, elder law attorneys are still able to assist individuals and families in developing estate plans to avoid depleting their assets, should they become ill and need long term care.

For those individuals [...]]]> By Kim Boyer
Elder Law News
November 2006

Despite the numerous restrictions the Deficit Reduction Act (hereinafter DRA) has placed on Medicaid eligibility, elder law attorneys are still able to assist individuals and families in developing estate plans to avoid depleting their assets, should they become ill and need long term care.

For those individuals who are already in a nursing home, despite the harsh new rules, elder law attorneys are continuing to help them qualify for Medicaid benefits while maximizing the amount of money they are able keep. Here is an example of a family we were able to assist post DRA enactment. (Names have been changed for privacy).

Betty came into our office in June. Her husband, Frank, had entered a nursing home which was costing the couple over $5,000 each month. Not including their home, their assets totaled roughly $150,000 at the time Frank entered the nursing home in April. Betty was told that she could keep the couple’s home as an exempt asset and then once they spent down to approximately $75,000, Frank would qualify for Medicaid.

We advised Betty that she could petition for division of assets and income, and set aside $99,540 to herself as her sole and separate property, called her Community Spouse Resource Allowance (“CSRA”). Starting January 1, 2007, the CSRA increases to $101,640. In addition, she purchased a Medicaid qualified annuity with the additional portion of their assets, with terms of the annuity conforming with the provisions under the new law.

The same month of our initial meeting, a Medicaid application was filed. Thereafter, we received word that Frank was approved for benefits retroactive to the date of application. Betty saved over $75,000, and she has additional income for her life to provide financial security.

Before purchasing an annuity, it is imperative that you consult with someone who understands the new criteria for annuities under the DRA. If structured improperly, the same annuity purchased by Betty could have resulted in an 11 month Medicaid penalty during which Frank would be ineligible for Medicaid.

Please keep in mind that Medicaid planning is very fact-specific and not all of the above planning techniques work in every situation. Before spending down all of your assets, we recommend contacting an elder law attorney knowledgeable in the area of Medicaid laws.

Disclaimer: This information is for general informational purposes only and does not constitute legal advice. For specific questions, you should consult a qualified attorney.

Back to Articles

Alzhiemer’s disease can make it difficult to accomplish tasks like cooking, making a phone call, or taking a bath. Modifying the home environment can make it safer and easier for loved ones to function at home. The Mayo Clinic offers these suggestions for simplifying living space:

One of our readers recently called our office to ask if we had literature on the difference between a Durable General Power of Attorney and a Guardianship. Due to the overwhelming number of times our office has been asked that question, we chose to make it the [...]]]> By Kim Boyer
Elder Law News
October 2004

One of our readers recently called our office to ask if we had literature on the difference between a Durable General Power of Attorney and a Guardianship. Due to the overwhelming number of times our office has been asked that question, we chose to make it the topic of this month’s Elder Law News.
What is a Power of Attorney?

A power of attorney is a legal document where one person (the principal) authorizes another (the agent) to act on their behalf. There are powers of attorney for assets which allow your agent to make decisions regarding your property and there are powers of attorney for health care which allow your agent to make decisions regarding your health care needs.

Your power of attorney can be broad in scope, giving your agent the ability to make any and all financial and personal decisions for you (a General Power of Attorney) or you can limit your agents authority by specifying the types of decisions you would like them to make on your behalf (a Limited Power of Attorney).

You also have a choice whether you would like your agent to have the ability to make decisions both now and if you become incompetent (a Durable Power of Attorney) or your agent can be limited to make decisions only when you become incompetent (a Springing Power of Attorney). You must be competent to execute a power of attorney. If you are not competent to execute a power of attorney, then a guardianship may be necessary.
What is a Guardianship?

Guardianship is a legal relationship where a court gives a person (the guardian) the power to make personal or financial decisions for another (the ward). A family member, public or professional guardian initiates the proceedings by filing a petition in the proper court. A guardianship over the person gives the guardian the power to make personal decisions for the Ward. A guardianship over the estate gives the guardian the power to make financial decisions for the ward. Often the court appoints the same person as guardian of the person and guardian of the estate.

Appropriate documentation is necessary to establish the need for a guardianship. A court determines whether the individual is unable “to properly manage and take care of himself or his property, or both.” (NRS 159.019). The guardian is required to report to the court on an annual basis.
The Differences

A power of attorney is a private way to decide who will have the legal authority to carry out your wishes if you can no longer speak or act for yourself. It is less costly than a guardianship, which is a public proceeding and the person appointed as your guardian may not be the person you would have chosen.

A power of attorney is limited in its authority to the scope of the document. Financial institutions sometimes refuse to honor powers of attorney for assets, due in part to their fraudulent use by agents. In contrast, a guardian has broad legal authority which is recognized by medical providers and financial institutions. A guardian is subject to court supervision for protection. Contact an attorney to appropriately address your situation.

Back to Articles

On February 8, 2006, the federal government passed a budget bill (the Deficit Reduction Act of 2005), which changes Medicaid rules. This newsletter is a summary of the changes that affect Medicaid.

Increases the Lookback Period to Five Years. All transfers will be subject to a five-year [...]]]> By Kim Boyer
Elder Law News
April 2006

On February 8, 2006, the federal government passed a budget bill (the Deficit Reduction Act of 2005), which changes Medicaid rules. This newsletter is a summary of the changes that affect Medicaid.

Increases the Lookback Period to Five Years. All transfers will be subject to a five-year lookback period rather than the prior three-year lookback period for individuals, and five years for transfers to trusts.

Postpones the Penalty Period Start Date. The new law shifts the start of the penalty period for a transfer of assets from the first day of the month of the transfer to the date one would otherwise be eligible for Medicaid, but for the transfer. The penalty period does not begin until the individual moves to the nursing home and the person would be eligible for Medicaid; meaning, until they have spent down to $2,000.

In other words, the penalty period does not begin until the nursing home resident is out of funds, and she cannot afford to pay the nursing home.

An example should help explain how this works. Let’s assume that Ms. Brown transfers $45,830 to her children on February 1, 2006. Ms. Brown enters a nursing home December 1, 2006, and has less than $2,000 in her name. The penalty period is 10 months. The difference in the current law and the proposed law is when the 10-month penalty period begins to run.

Under old law, the penalty period begins to run on February 1, 2006, which is the date of transfer. Ms. Brown would be eligible for Medicaid 10 months later, on December 1, 2006.

Under the new law, the penalty period begins to run on December 1, 2006, the date she enters the nursing home and has less than $2,000 in her name. Ms. Brown would not be not eligible for Medicaid for 10 months from December 1, 2006. This, of course, raises the question of how her care will be paid during the10-month penalty period.

The Effective Date. The new transfer rules apply to all transfers occurring on or after the date of enactment of the budget bill, February 8, 2006. Transfers made before February 8, 2006 are “grandfathered” in under the old transfer rules.

Annuity Changes. The purchase of annuity shall be considered a disposal of assets for less than fair market value unless the state is named the remainder beneficiary for at least the total amount of medical assistance paid on behalf of the annuitant. A spouse, minor, or disabled child can be named as the primary beneficiary, but the state must be named as the secondary beneficiary.

Equity in Homes. The equity in homes of nursing home residents exceeding $500,000 shall be countable, unless the nursing home resident’s spouse, child under age 21, or blind or disabled child is living in the house.

Disclaimer: This information is for general informational purposes only and does not constitute legal advice. For specific questions, you should consult a qualified attorney.

Back to Articles

Avis Maxey, who was 72 years old, ingested approximately 200 prescription pills in an apparent suicide attempt. Her ex-husband, Theodore, with whom she resided, delayed calling an ambulance because he believed she wanted to kill herself. When the paramedics arrived, they nonetheless attempted to resuscitate Avis. At the hospital, Theodore signed papers [...]]]> By Kim Boyer

Avis Maxey, who was 72 years old, ingested approximately 200 prescription pills in an apparent suicide attempt. Her ex-husband, Theodore, with whom she resided, delayed calling an ambulance because he believed she wanted to kill herself. When the paramedics arrived, they nonetheless attempted to resuscitate Avis. At the hospital, Theodore signed papers listing Avis as a Class III patient, meaning her treatment would be limited to comfort care without prolonging her life. A physician signed the order and later extubated Avis on Theodore’s request.

Avis was given an oxygen mask, but that was removed 10 minutes later “per husband’s request.” Over the next three hours Avis’s respirations decreased. The shift changed and a different physician ordered a morphine drip. Avis died soon thereafter, approximately four hours and twenty minutes after admission to the hospital. Later, the family filed a malpractice action.

For the first time, the Nevada Supreme Court addressed multiple sections of Nevada’s Uniform Act on Rights of the Terminally Ill (the “Act”), codified in NRS 449.535 through 449.690. Estate of Maxey v. Darden, 187 P.3d 144 (Nev. 2008).

The Act provides three methods by which terminally ill patients or their families can legally implement their wishes regarding withholding or withdrawing life-sustaining treatment. First, an individual may execute a declaration directing an attending physician to withhold or withdraw life-sustaining treatment under certain circumstances. This declaration is sometimes referred to as a “living will” and Nevada provides a statutory form.

Second, an individual may execute a declaration designating another person to make decisions on the individual’s behalf regarding withholding or withdrawing life-sustaining treatment. Again, Nevada provides a statutory form, but it is not required to be in that form. Both types of declarations must be signed by the declarant, or another at the declarant’s direction, and attested by two witnesses.

Third, in the absence of either an express declaration or a declaration designating another person to make life-sustaining treatment decisions, surrogate consent may be obtained from certain family members. Avis had not executed a declaration concerning her end-of-life wishes and had not designated a health care decision-maker. Therefore, the case turned on whether her physician received valid surrogate consent before withholding treatment.

The Act provides three requirements that must be met before there is effective surrogate consent. First, the patient must not already have an effective declaration concerning life-sustaining treatment. Second, the surrogate must consent to the withdrawing or withholding of life-sustaining treatment in writing, attested by two witnesses. Third, the attending physician must determine that the patient is in a terminal condition and is no longer able to make decisions regarding life-sustaining treatment.

The Act specifies which family members may provide surrogate consent, in the following order of priority: (1) the spouse of the patient; (2) an adult child of the patient or, if there is more than one adult child, a majority of the adult children who are reasonably available for consultation; (3) the parents of the patient; (4) an adult sibling of the patient or, if there is more than one adult sibling, a majority of the adult siblings who are reasonably available for consultation; or (5) the nearest other adult relative of the patient by blood or adoption who is reasonably available for consultation. If a class entitled to decide whether to consent is not reasonably available for consultation and competent to decide, or declines to decide, the next class is authorized to decide, but an equal division in a class does not authorize the next class to decide. Although Theodore was the ex-husband and not entitled to give consent under the Act, he presented as husband and the emergency room physician was unable to ascertain his status as ex-husband.

The parties argued whether the emergency room physician was an “attending physician” within the meaning of the statute. The Nevada Supreme Court found that the emergency room physician was the “attending physician,” finding that the Act refers to the physician “who has primary responsibility for the patient’s treatment and care at the time when administering life-sustaining treatment becomes an issue.”

The surrogate must consent to withdrawing or withholding life-sustaining treatment in writing, “attested by two witnesses.” Only the emergency room physician witnessed the consent, and the nurse made chart notes. There was an issue of fact as to whether the chart notes would be considered a proper attestation by a second witness. The Nevada Supreme Court found that, under the statutory provisions regarding surrogate consent, an attesting witness must have personal knowledge that the surrogate gave consent to withholding or withdrawing the terminally ill patient’s life-sustaining treatment. If an attesting witness is present at the time when the surrogate provides written consent, personal knowledge of the surrogate’s intent is presumed. NRS 449.626(1) does not require an attesting witness to subscribe his or her name to the consent form, but instead only requires proof of the attesting witness’s personal knowledge.

Finally, the attending physician must determine that the patient is in a terminal condition and is no longer able to make his or her own decisions regarding administration of life-sustaining treatment. The Act defines “terminal condition” as “an incurable and irreversible condition that, without the administration of life-sustaining treatment, will, in the opinion of the attending physician, result in death within a relatively short time.” The Court found that there was an issue of fact as to whether the physician exercised reasonable care in classifying Avis as terminal.

In conclusion, this case illustrates the need for effective declarations. It is important that declarations be attested by two witnesses. Another tool, not discussed in this case, is the durable power of attorney for health care. A durable power of attorney for health care allows a person (the “principal”) to state his or her choices for health care and to name an agent to make those decisions when the principal is unable to make decisions about his or her own medical treatment. The surrogate consent act is limited only to decisions regarding life-sustaining treatment and is limited to specific family members. In contrast, a durable power of attorney for health care allows the agent to make broader medical decisions for the principal, and any person can be named as agent.

i NRS 449.600(1).

ii NRS 449.610 provides as follows: “A declaration directing a physician to withhold or withdraw life-sustaining treatment may, but need not, be in the following form: If I should have an incurable and irreversible condition that, without the administration of life-sustaining treatment, will, in the opinion of my attending physician, cause my death within a relatively short time, and I am no longer able to make decisions regarding my medical treatment, I direct my attending physician, pursuant to NRS 449.535 to 449.690, inclusive, to withhold or withdraw treatment that only prolongs the process of dying and is not necessary for my comfort or to alleviate pain.”

iii NRS 449.613 provides as follows: “A declaration that designates another person to make decisions governing the withholding or withdrawal of life-sustaining treatment may, but need not, be in the following form: If I should have an incurable and irreversible condition that, without the administration of life-sustaining treatment, will, in the opinion of my attending physician, cause my death within a relatively short time, and I am no longer able to make decisions regarding my medical treatment, I appoint …………………………. or, if he or she is not reasonably available or is unwilling to serve, …………………………, to make decisions on my behalf regarding withholding or withdrawal of treatment that only prolongs the process of dying and is not necessary for my comfort or to alleviate pain, pursuant to NRS 449.535 to 449.690, inclusive. (If the person or persons I have so appointed are not reasonably available or are unwilling to serve, I direct my attending physician, pursuant to those sections, to withhold or withdraw treatment that only prolongs the process of dying and is not necessary for my comfort or to alleviate pain.)

Strike language in parentheses if you do not desire it.”

^iv NRS 449.626.

^v NRS 449.590.

Back to Articles

What is Estate Recovery? In 1993, the federal government passed a little debated law that required state Medicaid programs to recover from the estates of deceased Medicaid beneficiaries. This recoupment is referred to as “Medicaid Estate Recovery.” Usually the greatest asset owned by people facing a long-term [...]]]> By Kim Boyer
Elder Law News
April 2004

What is Estate Recovery? In 1993, the federal government passed a little debated law that required state Medicaid programs to recover from the estates of deceased Medicaid beneficiaries. This recoupment is referred to as “Medicaid Estate Recovery.” Usually the greatest asset owned by people facing a long-term care stay is their home. It is their greatest asset not only in terms of monetary value, but in terms of sentimentality.

The home is an exempt asset for purposes of qualifying for Medicaid. However, this does not mean that it is exempt from estate recovery. In fact, the home is the asset most frequently sought in Medicaid Estate Recovery.

The Nevada Supreme Court’s Ruling. On April 1, 2004, the Nevada Supreme Court ruled on Medicaid Estate Recovery in the case of State of Nevada Department of Human Resources v. Estate of Ullmer. The lower court prohibited the State from placing Medicaid liens against homes of surviving spouses of Medicaid recipients.

The Nevada Supreme Court ruled that the State may impose a lien, subject to certain limitations, before the surviving spouse’s death upon property in which it has a legitimate interest.

The Court said that the state “will release the lien upon the surviving spouse’s demand for any bona fide transaction, including, but not limited to, selling the property, refinancing the property, and obtaining a reverse mortgage.” However, “the state’s interest is not extinguished when the deceased recipient’s interest in the property is transferred for less than fair market value.”

This means that if the surviving spouse wants to sell the house, refinance or obtain a reverse mortgage, the lien must be lifted. If the house is gifted to someone, the lien will remain. The Court also said that the lien must be limited to the deceased Medicaid recipient’s interest in the home. For example, if the husband and wife own the property as joint tenants, then the state can only lien a one-half interest in the property.

Back to Articles