I hope some people get some benefit from the 4th lawyer I talked to. The State of Nebraska has expanded their Medicaid recovery to include any assets the Medicaid recipient had at the time of their death, which would include anything that passed outside of probate. The state considers my mom's house, car and bank account to be her estate even though the will was never probated.
Some of the good news, my mom deeded the house over to me with a Warranty Deed back in 2008 and kept a Life Estate interest for herself. Due to the age of the Life Estate the lawyer thinks they won't be able to force the sale of the house.
My mom had one bank account which had to be spend down to $4,000 to qualify for Medicaid. My mom had a POD which the lawyer said is usually a bad idea since the POD beneficiary can claim the money, leaving the estate with no funds to pay bills. The lawyer said there was a possibility that MERP could demand the money that was in my mom's bank account minus reasonable funeral expenses. The lawyer said it would be the responsibility of my mom's Executor or personal representative to get the funds back from the POD recipient to pay MERP.
He said the car could be another thing. Usually MERP won't bother with a junk car. According to the blue book the car is worth $895 but due to the fact the car has a misfire, it could be a near impossible sale. The shop can't give an estimate to repair a misfire because they don't know what's causing it. Fuel injector replacement would run $400 to $500 with no guarantee it would fix the problem. He said MERP would likely look at the make, model and year of the car to guesstimate the value. Buick Skylark was not a popular or expensive car when it was new. The body is in nice shape but it is a 97 which greatly reduces the value. The lawyer suggests that I wait until I hear back from MERP before I get rid of the car. You don't want to give the car away then learn you should have got $2,000 for it. The lawyer did say before I give it away, I should list it at $2,000 and see if anyone bites. In it's present condition the car can't be driven so the buyer will have to haul it on a truck or trailer.
The majority of what Medicaid paid was for community based services that she received in her home. There is no look-back for the Waiver program and she was only in the NH for 1.5 months so the paperwork had not been processed yet when she passed away. Medicaid has not said how much they are trying to recover.
Now we have to wait and see if MERP is going to bother trying to recover only a few thousand, if I'm expected to sell the car even if it isn't worth much and if I'll be able to continue to live in the house.
I don't want to think about hiring another lawyer and going to court over a few thousand dollars, but MERP may make it necessary.
Imo a lot of what happens w recovery is dependent on if your State is using an outside contractor for MERP or actually has state employees in State Medicaid department or State AG office doing it. The AGs get involved as recovery ends up being all about state laws on probate & property rights. It’s no longer an elder law issue as the elder is dead.
But I digress…. If it’s an outside contractor- like PCG or HMS - these tend to approach imo the situation as a debt collection agency would…. lots of phone calls, ton of letters and letter will be very narrowly time sensitive in responding. Like “if you don’t respond with documentation in 10 days then we assume there are no exemptions or exclusions to a recovery so a claim or lien placed on assets of the presumed Estate” type of correspondence. So please please pls pay attention to any correspondence.
So imo you want to be proactive and be ready for this, get Blue Book evaluation on the old Buick, ask the mechanic to do a note on his letterhead that the car does not run and an evaluation on it would be a minimum charge of $xxxx plus towing. This should show it’s not even worth it’s low Kelly BB value.
Are you hoping to stay living in the house? Or do you think you want to sell it and move out of state? What your likely future plan will imo make a difference as to what to do should the State not want to recognize the old Warrant Deed / LE paperwork as an exemption to recovery.
As far as we can tell, no lien has been placed on the house. The lawyer said a possibility is, MERP may place a lien on the house but just leave it sit there until I'm ready to sell and move out. None of the lawyers I talked to have ever had a case where MERP did a foreclosure on a house while a family member was living in it. The lawyers have even been confused by the LE since my mom created the LE in 2008 but the laws changed in 2017. Non-probate assets where not recoverable prior to 2017. Even the lawyer didn't know how to list the value of the house on the non-probate asset form I received from MERP. His thoughts were just send them a copy of the LE paperwork and let them figure it out. Since my mom deeded me the house back in 2008, technically she did not own a house when she passed away.
The lawyer told me to go to the Chevy dealership to get the value of the car. They basically laughed me out of the place. They said they might be able to allow me $500 on a trade. They said on a car that old, even running they wouldn't be able to sell and it would likely have to go to auction. If the engine needs rebuilding, it might only be worth the price of scrap. My reasoning behind getting the value down is because I really don't have the time or energy to try to sell the car myself. I just don't want to deal with a dozen people wanting to see the car but nobody wants to buy it because the price is too high.
The other issue is if MERP wants the $3,000 that was in my mom's bank account I would be responsible for getting the money back from her POD beneficiary. If they refuse to return the money, the lawyer said the estate may have to sue them to get it back.
Please come back to tell us how things work out.
My mom prepaid her funeral expenses, so we only owed a little over 1k for the church, lunch, flowers, etc. which has been paid with the help of friends and memorials. Then there was just a couple of small bills which I paid myself.