Medicaid is a critical program that provides long-term care coverage for seniors and individuals with disabilities. However, many families are caught off guard by Medicaid estate recovery, a process where the state seeks reimbursement for benefits paid on behalf of a Medicaid recipient. One of the most significant concerns is whether Medicaid can take your home or other assets after you pass away. The good news? With proper estate planning, you can protect your assets and your family’s financial future.

Ohio’s Expanded Medicaid Estate Recovery: What You Need to Know

In recent years, Ohio has expanded its Medicaid Estate Recovery (MER) program, meaning that assets once thought to be protected from Medicaid recovery may now be subject to claims after the recipient’s death. Historically, estate recovery applied only to probate assets, but under Ohio’s expanded policy, it now includes non-probate assets, such as those held in transfer-on-death accounts, jointly owned property, and living trusts.

This means that many previous Medicaid planning strategies may no longer be effective. If your estate plan was created before Ohio’s expansion of Medicaid recovery, it is crucial to review and update your plan to ensure your assets remain protected.

What Is Medicaid Estate Recovery?

Medicaid is a needs-based program, meaning recipients must meet strict income and asset limits to qualify. While certain assets, such as your primary residence, may be exempt when applying for Medicaid, they may not be protected after death.

Under federal law, states are required to recover the cost of Medicaid benefits from a recipient’s estate after they pass away. This process is known as Medicaid estate recovery, and it typically applies to those who received long-term care benefits, such as nursing home or home-based care. If Medicaid paid for your care, the state could place a claim on your estate, potentially forcing the sale of your home or other assets to recoup the costs.

How Medicaid Liens Work

There are two main types of Medicaid liens:

1. TEFRA Liens (Lifetime Liens): These can be placed on a Medicaid recipient’s home while they are still alive if the state determines they are unlikely to return home.
2. Estate Recovery Liens (Post-Death Liens): These allow the state to recover Medicaid costs after the recipient passes away, typically from probate and now non-probate assets due to Ohio’s expanded estate recovery.

It’s important to note that Ohio’s expanded estate recovery now applies to assets previously considered protected, such as:

• Property held in a transfer-on-death deed
• Jointly owned bank accounts
• Assets in revocable living trusts

Will Medicaid Take My House?

A common misconception is that Medicaid will immediately take a recipient’s home upon their passing. While the home is often the largest asset subject to recovery, there are exceptions:

• If a spouse, minor child, or disabled child is living in the home, Medicaid cannot recover against it.
• Some states allow hardship waivers if estate recovery would leave heirs homeless.
• If the home is transferred via an exempt transfer, such as to a caretaker child who lived in the home and provided care for at least two years, it may be protected.

Without proper planning, however, your heirs may have to sell the home to satisfy Medicaid’s claim.

How Can You Protect Your Assets from Medicaid Estate Recovery?

The key to protecting your home and other assets is early planning. Here are some strategies to consider:

1. Medicaid Asset Protection Trust (MAPT): By placing your home and other assets into an irrevocable trust, they may no longer be considered part of your estate for Medicaid recovery purposes. However, Ohio’s expanded estate recovery means older trusts should be reviewed for effectiveness.
2. Exempt Transfers: Certain transfers, such as those to a spouse, disabled child, or caregiver child, can protect the home from Medicaid recovery.
3. Prepaid Funeral and Burial Plans: Setting aside funds for funeral expenses in an irrevocable burial trust can help reduce countable assets without impacting Medicaid eligibility.
4. Gifting and Spend-Down Planning: While Medicaid has a five-year look-back period for asset transfers, strategic gifting well in advance can be an effective planning tool, but past gifting strategies may need to be reassessed under Ohio’s expanded estate recovery policies.

Why Early Planning Is Crucial

If you wait until a crisis—such as needing immediate nursing home care—to start Medicaid planning, your options will be significantly limited. Medicaid’s strict eligibility rules, combined with the five-year look-back period, mean that last-minute transfers or asset restructuring could trigger penalties or delays in receiving benefits.

With Ohio’s expanded estate recovery program, estate plans that were once effective may no longer provide the protection they once did. If your estate plan hasn’t been reviewed recently, it’s important to revisit it with a Medicaid planning attorney.

By planning in advance, you have more options to protect your home, savings, and legacy. Even if you or a loved one is already in need of Medicaid assistance, crisis planning may still help reduce asset loss through legally permitted strategies.

Get Help from an Experienced Estate Planning Attorney

Medicaid planning is complex, and every family’s situation is unique. At Ohio Heritage Law, we help clients navigate Medicaid eligibility, protect assets, and ensure their loved ones are cared for. Whether you are planning years in advance or facing an immediate long-term care need, we can develop a strategy that safeguards your estate.

Don’t wait until it’s too late! Schedule a consultation with us today to discuss how you can protect your home and assets from Medicaid estate recovery.

Call us at (330) 571-4151

Visit us at www.ohioheritagelaw.com

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