Can Medicaid take moms house?

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My mother has a will. Her wish is to leave her house to her children.

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This is what I was told in NJ. My Mom's house is for sale. I need to get "market value" for the house. If it sells, Medicaid will stop paying for Mom's care and I will then have to spend down again. If Mom passes and the house hasn't sold, a lean will be placed against the house which will need to be honored at time of sale. I was told wills are null and void at the time Medicaid starts paying for a person's care. Like said, no bills or taxes can be taken from Mom's money for upkeep of her home. And no guarentee that if u put the money out u can get it back.
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As an aside regarding estate recovery .....Mortgages and MERP (estate recovery process w/medicaid lien or claim) are similar in that they both are "debts". BUT are very different in that a mortgage (or HELOC or Reverse Mortgage) is SECURED debt with property as collateral for the debt. Car loans are secured debt. Secured creditors have ability to seize property (as in house foreclosure or car repo).

Medicaid is an UNSECURED creditor. Credit cards also unsecured. Just how UNSECURED creditors can deal with the debt / amount owed is very much interdependent on your states laws. Like some states allow for credit card or other unsecured creditors to put a lien or judgement on your home. But other states have laws more in the favor of property owners (like TX & FL) that do NOT allow leins or judgements from unsecured creditors to be placed on a home. So for these states my understanding is that a medicaid lien cannot be placed on the property while they are alive. States that tend to be more pro property rights also tend to take the same view towards heirship & probate. If heirs have a valid will and open probate then probate law is followed for how creditors are dealt with & estate distributed. Like for TX its a level of claim by class state for probate with merp as a class 7 claim. Credit cards are class 8. Class 1 - 6 are dealt with foremost before any 7's. (8's are credit cards). Creditors have to enter a claim (& respond to executor) as per probate rules for your state otherwise they could be time barred. I've found that an estate with very modest value home with no other estate assets & the usual probate costs, executor expenses & property management costs could well not have value of estate to pay beyond Class 1- 4 at best. No recovery.
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Also please please keep in mind that once a widowed mom goes onto Medicaid or is "medicaid Pending", she is required to have her monthly income (like her SS) be paid to the facility as the SOC (share of cost). So someone in the family will need to pay all costs on her home. Taxes, insurance, upkeep, etc. Now mom could live 6 mos or 6 years, but whatever the period of time, property costs must be paid. Loosing a house to tax sale happens all the time......

Estate recovery (merp) has all sorts of exemptions & exclusions. But each heir - as per a valid will - must qualify for their own in order for them to be placed. And heir / family will need to provide to the state whatever detailed documentation needed for exemption or exclusion. Whether its a lein or a claim that is placed & when will be very dependent on your states laws for property. If family opens probate, then probate law for claims against the estate matter. There isn't one single answer. It's something to discuss with an atty.
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Medicaid rules apply ahead of the will. If there were a mortgage on the house, it would have to be paid before any remaining equity could be distributed to heirs. Think of a Medicaid debt in the same way. (This assumes that Medicaid has provided benefits.)
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Vaugh, I see by your profile that your Mother is living in a nursing home. Is Mom self-pay or is Medicaid paying for all of her care?

If yes, then Medicaid usually places a lien on the house. Therefore, when the house is sold, the equity will go to Medicaid for reimbursement of Mom's care. If there is any equity left over, then the heirs will receive that money.

There are some exceptions, you would need to check with the State Medicaid office. Remember, Medicaid is different from Medicare.
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