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UPDATED: JANUARY 2012

680.6

OTHER ELIGIBILITY REQUIREMENTS

RECOVERIES ESTATE RECOVERIES

An annuity purchased on or after February 8, 2006 by an SSI- related Medicaid recipient is required to have the State named as the remainder beneficiary if the annuity is not treated as a countable resource (considered countable income only).

• Life Insurance – Generally, life insurance policies are not part of a decedent’s estate. However, if the beneficiary of the policy is the estate, or there are no surviving beneficiaries, the payout is recoverable as part of the estate.

Hardship

No recovery of Medicaid correctly paid will be pursued against any portion of an estate if it will result in undue hardship. Examples of undue hardship include: • the sole income-producing asset of the beneficiary (ies), such as the family farm or family business and income produced by the asset is limited, or • real property of modest value (i.e., having a value no higher than 50% of the average selling price in the county where the home is located, as of the decedent’s date of death) and the home is the primary residence of the beneficiary (ies), or • other complying circumstances.

Undue hardship is not considered to exist based on the inability of the beneficiaries to maintain a pre-existing lifestyle or when the alleged hardship is the result of Medicaid or estate planning methods involving divestiture of assets.

Waiver of Estate Recovery

The estate claim may be waived in whole or in part if the recovery against the decedent’s interest in the asset will result in undue hardship as described above.

Deferral of Estate Recovery

Recovery against a deceased Medicaid recipient’s estate must be deferred: • during the lifetime of the recipient’s surviving spouse; or • during any period in which the recipient has a surviving child under 21 years of age; or • during the lifetime of a recipient’s surviving child of any age who is certified blind or certified disabled; or MRG