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She is 91 and in a care home and is getting close to running out of funds to pay the over $6000 monthly cost.

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The key here is MERP.
Most states like her in NJ have opened a new department that Reclaims All Medicaid money paid out.
Contact a CELA.
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Ruggles - you dear are spot-on on that!! for a especially enlightening & scary read google merp drewitt texas. Many case studies of how the outsourcing is being done in Texas since HMS got the contract. BTW hms has like another dz states and counting. They are very good at what they do too and they seem to approach it as debt collectors. A different division does compliance for CMS at the federal level…like I said they are very VERY good at what they do.

MERP in my opinion is so inherently unfair to family as the letters go out within weeks of the death and just so often family is still overwhelmed and doesn't reply; or realize the need to reply to the MERP inquiry and provide the specific documentation needed (yeah sure they are going to go and find the cancelled check where they paid their parents taxes 2 years ago sort of stuff) and so they find months or years later when they need to sell or put the legal in order on the house, that the parents home has a claim or lein on it (which could have had an MERP exemption & so not be able to have a claim or lein attached) which has to be paid off to get a clear title or have an indemnity agreement done to sell.

GinGin - thank goodness you filled out the form and sent it back! You rock! You were the surviving spouse which is a MERP exemption and the market value info on the house showed that the house was under 500K (or 750K) and so there was no MERP claim or lein that could be placed on the property.
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Thanks for the MERP info, I had no idea that there was an actual recovery program. The fact that it’s being "sourced out" means that one may end up dealing with some very nasty/aggressive collection agencies.
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When my husband passed our house was in both our names. Medicaid sent me a form I had to fill out. It asked what the market value was of his share only. I never heard from them again.
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Thank you so much for this informatin. We do own the house together but I pay all the expenses....taxes, insurance, etc. We have right of survivorship so whomever dies first, the other gets the home.
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Medicaid allows for them to have as exempt assets their home & a car. They are exempt for their lifetime in most states by & large. All states have a limit on the value of the property (like 500K in most and some east coast states 750K). Now they will not have any funds to pay for their home or their share of the home for all the time they are in a NH as Medicare requires them to do a co-pay of their monthly income to the NH. But if you can afford and are already paying for all on the house, you can just continue to do so and have mom apply for Medicaid to pay for her NH stay. The home is an exempt asset.

But keep in mind that once mom dies, the exemption goes away. The states are required to do some sort of recovery for the payments the state Medicaid paid on mom's behalf. This is called MERP - Medicaid Estate Recovery Program.

MERP has all sorts of exemptions and exclusions. You should google your states MERP program to see what they are and if you fall into one of the categories. I bet you do. Whatever you do, you really really MUST be keeping all receipts and all documents to show anything you pay on the house. Really from having the yard cut to buying lightbulbs. If you aren't living in the house, then most states have it that all the normal reasonable expenses on the home that you are paying are an exemption. If you are living at the home, then 50% of whatever you are paying you can try to get removed from MERP as an exemption. All those little things add up, a lightbulb here, taxes, insurance, tree removal there….keep those receipts.

Also realize that since the home is owned 50/50, then if you did decide on selling the home that only 50% of the proceeds from the sale become mom's assets or MERP'd if you don't ever sell it. Now each state does MERP differently, some states have high rates of recovery & other states almost none; some states do MERP as a lein on the property while other states it is a claim. Some states do a cost/benefit analysis to see if it is even worth going after the claim or a lein on the property. MERP is inherently a legal process through probate court and that has costs to do. A low value home may not be worth going after. Other states have outsourced MERP and those situations seem to approach MERP as debt collectors. Whatever the case, after mom dies, you do want to make sure that you respond to any letter you get from MERP and submit your exemptions also get a release of MERP's claim or lein on the property. Good luck.
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