No. In most instances, the state cannot recover anything from your estate until after the death of your spouse, if at all. What is being asked about is something called estate recovery. In 1993, Congress passed a law requiring states to set up programs to recoup the costs of long-term care and related Medicaid services. West Virginia then enacted an estate recovery law in 1995. The West Virginia law gives the state two methods of reimbursement for the costs of long-term Medicaid care. Long-term care is care that is received either in a nursing home or under the Aged & Disabled Medicaid Waiver Program.
First, the State can file a claim against the estate of the Medicaid recipient after he or she dies. In that case, the State would file for the amount of Medicaid assistance “loaned” to the deceased individual. This amount would then be paid out of the estate after the following expenses were taken care of: costs of settling the estate, reasonable funeral expenses, unpaid child support, and debt and taxes given preference by federal law. Sometimes these claims are filed quickly, while other times no claim is ever filed. Generally, the state cannot enforce its claim until after the death of the surviving spouse or until there are no surviving children who are under the age of 21 or who are disabled or blind.
Second, the state can try to recoup its Medicaid expenses by placing a TEFRA lien on the individual’s property before the Medicaid beneficiary’s death. A lien is a legal claim made by a creditor concerning his/her interest in the money received for the sale of another person’s property. The state can only place a lien on property when an individual is determined to be “permanently institutionalized” in a nursing facility, intermediate care facility, or other residential institution. The lien dissolves if and when the person is discharged from the medical institution. In West Virginia, the law allows the state to use TEFRA liens, but as a matter of policy, the state has declined to use them. However, the state is legally permitted to begin exercising its right to use TEFRA liens at any time.
No lien can be placed against the home of an individual–regardless of whether the individual is permanently institutionalized–if the home is the lawful residence of the individual’s spouse, child under 21 years old, disabled child, or sibling who has an equity interest in the home and who lived in the home for at least one year immediately before the date of the individual’s admission to the nursing home.
Further, if you transfer or sell your home before the beginning of the look-back period, the home will not be regarded as an asset and will not be subject to Medicaid estate recovery. Also, in early 2014, the WV legislature created another option for transferring property while avoiding Medicaid estate recovery called the Transfer on Death Deed. More information is available on this new type of deed, see the section on giving away property without going through probate.
For more information, see: W. Va. Code § 9-5-11C (2014); Charles P. Sabatino & Erica Wood, Medicaid Estate Recovery: A Survey of State Programs and Practices, Public Policy Institute, AARP (1996); West Virginia Department of Health and Human Resources, Income Maintenance Manual, § 17.13(C), http://www.wvdhhr.org/bcf/family_assistance/policy.asp (last visited May 26, 2015).
