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She has a will, house $50,000 {under, } in Texas been in nursing home 18 months and just passed away. Thanks, Kathleen

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Most likely they will take whatever they need to pay off her bill. Generally - and I say generally, as every situation can have unique aspects and each state is a bit different - Medicaid puts a lien against the property which is then sold unless the debt is paid some other way.
Take care,
Carol
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I'd be cautious on getting the property condemned.
If its an older property or has been through flooding or had new drywall 2005/2009, you may have to get an environmental done on the property BEFORE it can be torn down and then it gets removed under whatever hazard mitigation is REQUIRED to be done.

Older houses can have asbestos or if there was flooding as per FEMA in the area you may have mold inspection and remediation removal required to be done. If any of drywall was put in during Chinese drywall incident period that too has a specific remediation on removal. All total PIA to deal with. I know of houses that have had all 3 issues.

If there are major issues lurking about, it might be better to get inspection & conservative appraisal done and sell "as is" and denoting that seller is deceased and so because of that you as the executor cannot accurately determine if there are any environmental issues and sell the house asap for whatever figure seems to be somewhat reasonable and notate that there could be a claim or lein on the deceased estate due to MERP in the act of sale paperwork.

SSbrave - Good luck, it sounds like a real clusterF to deal with
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Shy1997 a person with Life Estate has to be bought out of the deed. The IRS and Medicaid use an actuarial table to determine the value of life estate/life tenancy. Far better you wait until her death, when you do not have to buy out her share.
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Kitty2 - you are in TX? MERP in TX is done by a claim in probate as it is a debt of the estate. Most states do not do it this way and MERP is a lien.

TX is an easy probate state. The claims against the estate are classified in order of payment: class 1 is funeral, burial, recent medical; class 2 is maintenance of the estate; MERP is a class 7, etc.

But before you deal with probate, the main & VERY IMPORTANT issue is whether or not MERP will even file a claim against the estate for Medicaid NH $$ recovery.

You or whomever is the representative of the estate (whomever is going to be the executor once probate is opened) need to send a letter to TX DADS notifying them that you are either going to file or an exemption &/or your own claim for expenses against the estate. This needs to be done ASAP - keep is short with all your contact information. As per State of Tx website: "Personal representatives of estates who elect to provide notice to the State for presentation of an estate recovery claim should send the notice to the following address:
Accounts Receivable
Mail Code E-411
Texas Department of Aging and Disability Services
P.O. Box 149030
Austin, TX 78714-9030"

If you are doing an exemption, there will be forms MERP will send you to fill out. What exactly depends on which exemption you are claiming.

For claims for $ spent on the home it's different. Remember, once they are in LTC/NH there was no $ to be used on the home as ALL money less personal needs of $ 30-60 a month was paid to the facility. So you or whomever in the family paid for everything for the house even though it is in not in your name. Who paid the insurance, property taxes, yard work, other stuff? Any one who paid can file for recoup (accounts recovery) of their $ which will be deducted from the total that MERP wants. Also if you spent $ on any care before she went into the NH that kept her from going into the NH, that $ can be deducted too. MERP needs to get a letter from anyone who is going to file their own recoup claim.

For example, the insurance, taxes and repairs for the past 2 years is 15K and your have cancelled checks and receipts to prove it. Also for 3 years before she went into the NH you (you paid & not out of her $$) paid for a home health service to come to her home to help her. That cost you 10K but it kept her from going to the NH for those 3 years. So you have your own claim for 25K that will need to be deducted from MERP.

By letting MERP know you have & will file for an exemption or a claim, they can evaluate whether or not it is even worth doing a recoup on your mom's estate. For a property with a low value & a claim it's not really cost effective for MERP to spend the time. In TX the MERP recoup % is low compared with other states.

Again, you need to let MERP know asap you will file a claim or an exemption. The exemption list is on their website:
www.dads.state.tx.us/services/estate_recovery/

My gut feeling is MERP doesn't persue claim unless they can recoup a clean $100/150K+ from the sale of the home. MERP is done by contractors so a small estate w/an expense claim, low value home is going to take too much time to be worth it. It's the same level of paperwork for a 50K house as for one that has a value of 200K, I know what I'd go for.......

When you go to probate, you will need to have an "Authorization and MERP Certification - July, 2009 edition" form done in order for the probate judge to distribute the house as per the will. You also need this done to have a clear title. It's a simple 1 page form that you or your probate attorney faxes to the MERP contractor - they are super quick with a 3 day turn-around.

If it's a really small estate (with a will and just the house and a small amount of $) and you get the MERP certification/release form above, you might not even need to go to probate. You could go the muniment of title route on the house, so the house goes into whomever is named in the will to inheirit the house. All these things are sticky and you really should get a probate attorney who practices in the county where the property is to handle it for you as you want it to be done right. It will make it all go smooth and alot less pressure. If you have the paperwork together (death certificate, will, inventory, MERP forms) the actual attorney time is small. I've been executrix twice and the attorney's fees were around 3% to 7% of the estate or maybe $ 150 -300 hr which is well worth it. Good luck and get that letter off.
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Google Randy Drewett. His website is filled with all kinds of MERP & elder law info that is easily readable. Randy's based in big, beautiful Beaumont.

Keep in mind and make it your mantra.... HMS is a contractor for the state and not an arm of Texas government, even with the state seal on the letterhead. HMS is a collection agency.

I will suggest that every thing discussed needs to be followed-up in writing and sent certified & return registered mail (the green card). There are tight time-frames on MERP.So you need to be tip-top on timeliness.

If you're not claiming MERP exemptions, and you paid for anything for the house then you need to be planning on filing your own claim for every penny spent & let HMS know that. You get paid first before MERP for it. This works only if the house is empty.

MERP is a class 7 claim in TX - that means there are 6 other levels of claims that get paid first. If you are appointed you can get paid for management of the estate (class 2). Your expenses on the property go in this category. Between these 2 that alone could eat up the value of the estate. With zero left for HMS.

Part of your sticky issue might be the whole "no will" aspect. Maybe when it's "intestate" it changes how MERP get's done. If there is no surviving heir, all property goes to the State under property code 71.001. You may just need to get an elder care attorney to work all this out for you and soon.

As far as the value of the house, go to Zillow or Trulia to see what the comps are for houses nearby that are similar and sold within the past 90 days to see if it's in the 18K range. This might be hard because that is so low it isn't worth data collecting. Getting the appraisal changed can be done - I did it for my mom & had reduced over 50K due to major foundation issues but I went in with photos and 3 estimates for foundation and another set for interior repairs all from licensed co. They checked to see if they each had a current license too. They were quite nice about it as really make much tax difference since in most county/cities 65+ taxes are frozen or have a homestead exemption. Good luck.
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lettyc745, If the claim was not presented at probate, they may be out of luck. If you got title insurance, you may have to use it. Also beware of false MERP scams.. I think you should see an attorney.
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On a general basis, I don't have an issue with MERP. I can understand why the feds made the states do some sort of recoup. But I do have a problem with it's being turned over to collection agencies and without a Fair Credit Reporting Act to be accountable to.

MERP -Medicaid estate recovery gets to the heart of the issue of who should pay for long-term care -- the public through the tax-supported Medicaid program, &/or users of long-term care through their personal resources, including those remaining after death. Amounts collected from Medicaid recipients' estates are not insignificant in absolute terms. They do, however, pale next to total Medicaid spending for long-term care.And it's only going to increase, given that Medicaid is available only to those with very limited resources and the state of US economy.
In a way, the fact that so many people are poverty level will decrease the amount of MERP because many heirs will be able to do hardship exemptions.

At my mom's NH wing, there are 9 ladies in their 90's & all of them have 1940-1950's era homes & all have decades of delayed home maintenance to some degree. All but 2 sit empty. I don't think any of them can sell for the assessor value. Just how is MERP going to deal with releasing a claim on something that will never sell at it's supposed value? It's going to be a nightmare to enforce.
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Question: Mother was on medicaid and on hospice in a care facility at the time of her death. I am a widow and have been living in her home for the past 8 years. Her lawyer prior to her death filed a "Lady Bird" deed so her property rolled over to me at the time of her death. MERP is now filing a claim for $64,084. I have only my social sercurity income . Making only $16,000 a year.
Can they make me sell the house? or if I sell the house and move to where my kids are, will the make ME pay them the money? There was a will. No assets, no Probate. House is in my name. No liens on property.
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Grandma, rules are complex and vary from state to state. See an attorney.
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Grandma - if the "Lady Bird" deed (aka Enhanced Life Estate Deed & sometimes an Enhanced Benefit Deed or Transfer on Death Deed) was properly done then the property should have transferred to you outside of probate. That is why Lady Birds' are done - to deal with an asset OUTSIDE of probate. There are just a handful of states that recognize & accept Lady Birds too (like TX, MI, FL). So assuming you are in a state that does then IF all the paperwork on the house was done & filed & property is now fully in your name & has been you should not have to worry about MERP. MERP does not know that a Lady Bird exists - they seem to assume that all property is open to their claim or lien & will go to probate.

Why? because in theory it is through probate that MERP (Medicaid Estate Recovery Program) can enforce it's claim or lien against the estate of the deceased. So no probate = no MERP. Whether it is a claim or a lien will depend on your state's laws for property, probate, etc. Like for TX, MERP is a level of class for claims probate system, & MERP is a class 7 claim. So all other classes 1 - 6 are paid first & foremost, so the MERP recovery rates are low. But this is based on the heirs actually going, filing and doing probate. Many folks just don't do probate so MERP seems to be doing a claim or lien by default for those.

But you are outside of probate, so you need to let them know. I'm assuming that you just got a letter on state letterhead that reads something like " we are sorry for your recent loss……the deceased owes the state of whatever $ 64,000 which is due now". It is not a warm & fuzzy letter. Within the letter there should be a timeframe indicated in which you have to respond by a letter or by filling out a form to let MERP know is there are exemptions, exclusions or other hardships that affect the property. A lady bird deed because it falls outside of probate provides for an exemption from any MERP action. Now you can contact the attorney who did the lady bird to do this for you or you could do this on your own (I think you can do this first part on your own). I would suggest that you do a very short 1 page letter to respond to the letter that: "This property (put in the extact address and the parcel # that is it's ID as per your tax assessor) transferred as per a Lady Bird Deed (you need to put exactly what they are called in your state). As such no probate was needed or will be opened. I consider the transfer of the property as per all state laws & statues and not subject to any MERP action. Thank you for your attention to this. All further questions or concerns regarding this must be sent to me in writing at……". Then sign you name as how it reads on the property. Then you mail this letter registered mail with a return registered receipt (this is the green post card). All this will run about $ 8.00 at the post office. In about 8 - 12 days you will get back the signed off post card. This provides for your legal document that you have done what you need to do to establish your position as to your trumping any MERP claim. Put the copy of the letter and the returned post card someplace save. Understand?

Now if after this, they continue to insist you owe MERP, I'd get an attorney. But more likely they will want documentation of the property transfer & for more fun, they will want it within a few days. So try to soon either go on-line to your courthouse records and pay a small fee to download or have mailed to you 2 copies of all the legal on the house. For most it's under $ 5.00 per document too. Some counties don't do on-line so you may have to go to the courthouse. If you're not used to a courthouse and get intimidated, go early about 9/9:30 AM and let the ladies who work the desks in the tax assessor or chancery clerks office guide you - I've found these gals are pro's and love having a older 'auntie" to help out as a break from the steady stream of paralegals & attorney's.Oh take cash too as most courthouses will not take checks from individuals and will place a service fee on credit card charges.

You do want to get a "release of claim or lien" from the state too. This is a form that is specific to the property& it's county that comes from the state. Then go to the courthouse and have it filed on the property/parcel. This just legally establishes that there is no MERP on the property so that there is no issue in the future when you go to sell the property or transfer it to your family.

In a lot of states, MERP has been outsourced to contractors. So some are going through past years or a backlog of deceased Medicaid recipients to try to get recovery $$. MERP contractors - who do this under state contract - get a % of the recovery (in my mom's state it's 16%), so it's very much like an aggressive debt collector rather than the slower state employee doing MERP. Let us know what happens too - we all learn from each other. Good luck.
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