How to Get Out of Medicaid Debt

If you are the heir to a family member who died or is expected to die owing money to Medicaid, you should understand that the estate may be subject to attempts by the state to recover its costs. This is because under the Tax Equity and Financial Responsibility Act of 1982, Medicaid becomes the first lienholder on many assets that otherwise would pass to heirs unencumbered. Each state runs its own Medicaid program, so state laws vary on specific Medicaid recovery procedures.

Instructions

1

Determine the amount of Medicaid debt. If you are an heir to a Medicaid recipient, you may get a Notice of Medicaid Debt from the Medicaid office in your state.

2

Determine if you qualify for an exemption, waiver or deferral. This may apply if you are a surviving spouse or if you or the heir is disabled, blind or a minor child. Waivers may also be available for cases of undue hardship or other extenuating circumstances. These are notoriously difficult to get, and criteria varies widely by state.

3

Determine what assets may have been held in a trust. Under the law, if assets were in a trust and not available to the Medicaid recipient, they may be eligible for a waiver of Medicaid collection efforts, since they were not a "countable asset" to begin with.