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In TEXAS: My grandmother (94) is in a nursing home on Medicaid and was not required to sell her house. When she dies, will proceeds of house go to heirs or Medicaid? I've been paying insurance and utilities for this empty house for several years.

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my mom still has her home & is in a NH on Medicaid so I try to keep up with all this, therefore the previous posts. Long story short....you have to start to get all the documentation together for all the expenses on the house. Cancelled checks, invoices, etc. That would include utilities, yard work, taxes, insurance, repairs, etc that you paid on the empty home. If the home was occupied, then this exemption is out. I'm pretty sure it has to be an empty home. Also remember that you have to get this to the state (HMS) within the timeframe on the letter after death that is sent out. MERP needs to evaluate the cost-effectiveness of the claim as it is eventually a legal process in probate court. Which in TX probate can go for 4 years from the date in which Letters are presented to probate court. Also TX does require an TX attorney if the executor of the estate is not a resident of TX. Good luck.
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more info:
Texas Administrative Code

TITLE 1 ADMINISTRATION
PART 15 TEXAS HEALTH AND HUMAN SERVICES COMMISSION
CHAPTER 373 MEDICAID ESTATE RECOVERY PROGRAM
SUBCHAPTER B RECOVERY CLAIMS
RULE §373.213 Deduction Allowed for Expenses for Home Maintenance and Costs of Care
(a) An amount equal to necessary and reasonable maintenance expenses and taxes may be deducted from the Medicaid Estate Recovery Program (MERP) claim for maintaining the home of the deceased Medicaid recipient, provided that sufficient supporting documentation of these expenditures, such as receipts, is provided to MERP by estate personal representatives, heirs, or legatees. Necessary and reasonable expenses for maintaining the home include real estate taxes, utility bills, insurance, home repairs, and home maintenance expenses such as lawn care.
(b) An amount equal to the necessary and reasonable expenses for the direct payment of the costs of care (including payment of personal attendant care) provided for a deceased Medicaid recipient that enabled the recipient to remain in his or her home and thereby delayed the institutionalization of the Medicaid recipient may be deducted from the MERP claim, provided that sufficient supporting documentation of these expenditures, such as receipts, is provided to MERP by estate personal representatives, heirs, or legatees.
(c) Requests for obtaining allowable deductions from MERP claims for expenses under subsections (a) or (b) of this section must be made in writing within 60 days after receipt of the Notice of the Intent to File a Claim by MERP. All supporting documentation must be attached to the request and sent to MERP, Home Maintenance/Costs of Care Request, P.O. Box 13247, Austin, Texas 78711.

Source Note: The provisions of this §373.213 adopted to be effective March 1, 2005, 30 TexReg 830
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Below from State of TX website:

What will the heirs to the estate have to pay?
The amount of a MERP claim against the estate of a deceased Medicaid recipient is the amount paid for the benefit of a Medicaid recipient for covered long-term care services, including related hospital and prescription costs, received after the Medicaid recipient reached age 55. If the total of the claim exceeds the value of the estate, heirs will not be liable for the balance.

Are there any other allowable claim deductions that may reduce the amount owed?
Under MERP, certain deductions from the claim amount may be considered when sufficient supporting documentation is available. These include necessary and reasonable home maintenance expenses for vacant homes of institutionalized recipients. Costs such as real estate taxes, real estate insurance (excluding liability), utility bills, home repairs, and other maintenance expenses such as lawn care would be allowed.

In addition, deductions from the claim amount may be considered for necessary and reasonable expenses for care (including payment of personal attendant care) provided for the Medicaid recipient that enabled the recipient to remain in his or her home, thereby delaying the need for institutionalization. The documentation submitted must be paid invoices from a provider showing the allowable charges and payments made.

How will Medicaid costs be recovered?
The acceptance of Medicaid assistance provides a basis for the state to file a Class 7 probate claim. (my NOTE: This means there are six other classes of claims that receive priority in payment from the estate before Medicaid gets paid. this is important.... examples of estate debts allowed prior to the MERP claim are funeral costs, estate administration costs, and secured claims such as mortgages or tax liens. a Class 7 claim is way down on the list in probate)

The state will make a claim in Probate Court against the estate. Medicaid cost recovery will follow claims procedures specified in the Texas Probate Code.
(NOTE: MERP in TX is now being done via contract with HMS and they are very through and very precise. )

How will beneficiaries be notified of the state's intent to file a claim?
Within 30 days of the notification of the death of a Medicaid recipient, MERP will send a Notice of Intent to File a Claim to the decedent's estate representative, guardian, agent with durable power of attorney or medical power of attorney, or family members who have acted on behalf of the recipient, provided that their name and address are known. The notice will include a program overview, a questionnaire to be completed and returned, and an undue hardship waiver request form. (NOTE: it is CRITICALLY important that you file whatever within the timeframe indicated on the letter. The timeframe is central to whether or not a MERP claim is to be done. If you do nothing, then MERP seems to take the approach that there are no exemptions or other claims against the estate.)
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Likely, they will require a sale (or equivalent money) for what they paid for her care.
If a spouse still lives in the home, then a lean is placed against it but the spouse is allowed to live there. However, if this home has been empty, it is an asset. I can't speak for Texas, but I expect this will be the case. If anyone is reading who lives in Texas, please chime in : )

I might add that no matter how much advice your read about Medicaid, it's best to check with your state. If you have major questions, an elder law attorney is a good resource.
Good luck,
Carol
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