Can't Texas Medicaid Put a Lien on this House

The State of Texas has alot of info on the DHHS site regarding MERP - Medicaid Estate Recovery Program. When whomever put granny in the NH, if they signed her in as Medicaid or "Medicaid pending", then they signed an agreement to MERP for any and all property that granny owned.

How Texas MERP runs is that when probate is done on gran's estate there will be a lien on any real property she owned, that shows up during probate. All MERP is done within probate. The lein may or may not show up on the county's tax assesors data or recorded in the courthouse or post a notice on the house.

You are lucky you are in TX as probate there is pretty simple and could be done without an attorney if there are no complications.

The immediate complication I see is that your dad could not legally deed the property to you if she was put into a NH on medicaid since 2003 or 2004 (whatever the year was that TX did MERP legislation). If you bought the property at fair market value and the money went into gran's bank account and the money was used for her care, then it would be a valid sale and you should already have title to the house. But if he just deeded it to you and all you have is a paper stating that and there has been no legal transfer of the property to your name, then you do not own the property. It's not till probate is done that the property can be release/titled to whomever is the heir according to her will and they transfer or sell it to you. If MERP said they would do a release then that would be filed by MERP
in probate.

Were you paying the home equity loan on the house? If so, then you need to present to the court that information so that $ can be recovered from her estate.
The more documents, like cancelled checks, you present to the court the easier it is for the judge to do whatever in your favor.

MERP is actually done by an outside contractor for the State. When gran died you or your dad had a period of time to file a financial listing of items you or your dad or whomever did things for her or her property that will be deducted from her estate.

For example, I keep a list of all the expenses that I have paid on my mom's house - like taxes, insurance, maintenance, etc. ALong with a copy of the check or a receipt for cash payments (like for the yard guys). So whenever the day comes that she dies, I have it done so MERP knows that I will be filing $XX amount of money to be recovered first from her estate.

If gran was in the NH for only 4 months, then the amount that Medicaid paid is probably low. 4 months X $ 5K = $ 20K Medicaid. Not enough to be worth it especially if the house has other leins or is in an area where it can't be sold easily
or the value of the house is low to begin with. So lucky you on that.

There is a formula as to whether they go after the proceeds from the sale of the house - I haven't found it yet but I bet it's a recovery of more than 75K.

When MERP was done, real estate was HOT - back in the days when everybody thought they could flip houses and make a ton of money. Property values were skyrocketing. Now it's totally different. The State really can't afford to inheirit thousands of MERP properties so they are probably only going after the ones
that there is real $$ to be made from and that can be easily sold.

I would suggest that you get a probate attorney to clear up the deed issues. You want someone who's office is in the county where gran's property is, not where you live. The cost is actually reasonable as alot of it is document-running that is done by paralegals on behalf of the attorney.

Also in TX you have 4 years from the initial filing to close probate. Which is a huge amount of time, so you don't have to be rushed to get things done. Good luck!

My Grandmother was in a Texas nursing home here in east tx where we live and prior to her going into the nursing home my mother her daighter took care of her along with myself. While she was in the nursing home my mother took care of her home as well as paid all the bills and taxes as well as visted her every day for 2 years until she past away at 90. My mother lives right next door to my grandmother there houses are on the same property and she was basically living there along with living in her own home,kind of a dual living existence. The nursing home has put a lien on my grandmothers property about a year ago. My mother has breast cancer but has gone into remission, dealing with that along with diabetes and other health issues all the while taking care of my Grandmother. We have a good lawyer who's on top of this just wanted another opinion. She should fall under some kind of exemption.

ericwvr, it's not the nursing home that has the lien, it is the state of Texas seeking repayment for Medicaid benefits. So grandma's house has to go through probate where houses are often sold to pay the remaining bills.

Eric - woah, I've just re-read my answer from 2011!! its actually somewhat different than I wrote 5 years ago.....So after grannie died there would have been sent a oversized size flat envelope that is the NOI (notice of intent) to whomever was the contact person for grannie on file within TXHHS /TxDADS that was sent by the outside contactor (HMS) for estate recovery (MERP) for Texas. It would have come within 90 days of death if she died 2015/2016. Within the NOI, it would state the amount of $ medicaid supposedly paid for her care and it will also state that unless you provide information to the contrary that the State considers the amount is valid and recovery to be cost-effective and there are no exemptions, exclusions to recovery. There is a questionnaire enclosed that is supposed to be filled out and sent back within 90 days. My take on this is that answers provided in the questionnaire is used for the state & the contractor to determine IF recovery will be done & what type of recovery action (lien, claim, insurance surrender) & if cost-effective. Like for example, all those taxes, utilities, etc paid by your mom on her mothers property could & should have been submitted as under TAC (tx administrative code) those are exculsions from the Medicaid tally so like 30k class 1 & Class 2claims of expenses on a 40k estate probably not cost effective for recovery. If mom was filing a caregiver exemption, or low income heir, or other exemption, that should have been denoted in the answers to the questionnaire. If you have or are planning on opening probate, you denote that in the questionnaire and attach a copy of the will. If the questionnaire isn't done & returned with supporting documentation within the specified timeframe, the amount is viewed as valid. If the exemption, etc. are denied, you can file an appeal. But if you do nothing a lien can be placed by default.

Unless you let the state know differently (by opening probate or having a Lady Bird deed or other legal existing), they seem to be considered to have died intestate and for TX dying intestate means all assets of the deceased estate escheat to the state. To get out of this there better be a will so you go & open probate or you have get an atty to do a lineal heirship.

But if there is a valid will and probate is opened, then whatever happens must go along the TX probate system. MERP is a Class 7 claim against the estate. What happens -really to me - is pretty interdependent on what other claims are out there, the value of the property and the ability of the executor & probate atty to deal with this. It's not a DIY project, you need an atty.

TX allows for 4 years from DoD to open probate. If grannie died with a valid will, then to me, your going to be best off getting a probate atty & opening probate ASAP. I'd get a probate atty with some degree of experience with estate recovery. Ask the atty clearly on this. Whomever is the executor named as per the valid will kinda need to start gathering together every single receipt, cancelled check etc on every penny spent on the property, for grannies funeral, burial and any other outstanding bills that grannie could have left. These are all going to become class 1-3 claims against the estate. The executor is going to need to get property appraised and if it's "undivided interest" on it (which it sort of sounds like) it's going to be very important that your appraiser know his /her stuff.

Out of curiosity this is east TX so any old oil & gas running through the land? & what was the land & the improvements assessor value for the year she died?

My mother passed on Oct. 8,2016. I had to put her in a nursing facility on March 13, 2015 due to dementia. She has transferred her house into her 3 children's names in 1990. She basically had nothing. She had 3 small life insurance policies that I cashed in and bought a burial policy with. I paid the balance of the burial policy myself. She was on Medicaid. I just got a bill from tx Medicaid estate recovery for 89,000. I believe it is for the time period when her Medicaid was pending. What do I do?

My mother passed on Oct. 8,2016. I had to put her in a nursing facility on March 13, 2015 due to dementia. She has transferred her house into her 3 children's names in 1990. She basically had nothing. She had 3 small life insurance policies that I cashed in and bought a burial policy with. I paid the balance of the burial policy myself. She was on Medicaid. I just got a bill from tx Medicaid estate recovery for 89,000. I believe it is for the time period when her Medicaid was pending. What do I do?

Gaddis - what you have gotten is a NOI / Notice of Intent (to file a claim or a lein against the estate of the deceased). When your mom went onto Medicaid, all the Medicaid rules for compliance came into play. Like her having to do a co-pay or SOC (share of cost) of her monthly income (like her SS check) to the NH. Another part of Medicaid compliance is that the state is required to do an attempt to recovery all costs paid on your mom from whatever assets could be a part of her estate. That is why a letter was sent. It is routine. Goes out about 6 -12 weeks post death. Please calmly re-read the letter… yeah its not warm and friendly but more of what a debt collection agency sends. The NOI is imo to find out just what assets are out there (or verify what info is already known) and find out what the family is intending or likely to do (like open probate).

Mom got apparently $ 89,000 of Medicaid paid services as Medicaid paid for the room & board dally costs of her staying at the NH. For TX it's about $ 160 a day R&B.
You do NOT owe the $.
Your mom's estate would owe whatever assets from her estate are determined by the probate process & laws to be valid claims & due from her estate to claimants. TX is a level of claim by class probate system. MERP is a class 7 claim.

If the property was correctly transferred to you & your siblings back in 1990 & all was properly recorded (so the tax assessor bill reads your & siblings ownership), then her old house was never a part of her assets for the determination of her eligibility for Medicaid. It is not part of her estate. If those small life insurance polices were written so you or your siblings were the beneficiary, then they too are not an asset of her estate. If both of these are correct, then mom died with basically nothing….. impoverished with no more than 2 k of assets (medicaid limit), no house, no life insurance policy that had her estate as beneficiary…. then mom died with no assets except for maybe whatever $ left in her NH personal needs trust account (from the $ 60 a mo for TX personal needs $) or her old bank account (if she even kept having one).

If no assets = no estate = no estate recovery. No need for probate.

I'd suggest you make double sure that all the house transfer paperwork is in order. How to do this…. in Nov or maybe late Oct., the tax assessor bill was mailed out as it's due EOM. Find the bill and review. If its in your name or your siblings names, than all should be just fine regarding proper transfer of ownership. You can also go on-line for the courthouse records although for TX it's kinda cumbersome… you may want to ask your tech savvy kids to surf this. If insurance was done so that the beneficiary was mom's estate (but somehow you were able to get it paid to you) that is somewhat stickier in that it's an asset of her estate. But not enough of an asset to even pay in full for her funeral & burial (which is a Class 1 claim) so the estate would be either less than 3K or has under 10K recoverable value so recovery is NOT cost effective so will not happen.

I'm of the opinion that you need to respond to the NOI. It was sent by HMS, which is the outside contractor for TX Medicaid Estate Recovery Program. I'd suggest a short 1 page letter stating that mom died impoverished to accompany the questionnaire & mail it certified with the return registered receipt from the USPS. You want the RRR - the green post card as it requires a dated signature to be returned to you. Maybe $ 8.00 to snail mail. Best $ 8.00 spent. Good luck and stay calm.