USA Today: Medicaid’s Death Bill for Long-Term Care

Some estates of former Medicaid beneficiaries are getting “death bills” for the cost of long-term care services under a little-known Medicaid estate recovery law, reports USA Today.

The article profiles the family of a 92-year-old woman that Medicaid billed for $25,347 following the death of their mother, who had received home-based medical care in the last years of her life. Medicaid told the family it would place a lien on the deceased woman’s New Jersey home if the bill wasn’t paid in full. 

“By law, the state can force the families of deceased Medicaid recipients to sell off their loved one’s home, heirloom jewelry and other possessions to repay the cost of whatever benefits the person received from age 55 on,” the article says.


States’ ability to recover Medicaid expenditures in certain circumstances isn’t new, but it’s relatively unknown and little-utilized. In 2003, states recovered $347.4 million—only 0.13% of the year’s total Medicaid spending, according to a 2004 AARP report. 

New Jersey is more aggressive when it comes to recovery of Medicaid expenditures, according to USA Today, with state records indicating it has recovered nearly $40 million in the last four years. 

One of the aims of the federal estate recovery law is to deter Medicaid beneficiaries and their families from “gaming the system,” Matt Salo, executive director of the National Association of State Medicaid Directors, told USA Today. 


“As it stands, Medicaid is virtually the only source of long-term care coverage in the U.S., Salo said. To qualify for long-term care under Medicaid, individuals generally can’t have more than $2,000 in total assets, but the person’s stake in their home doesn’t count toward that amount,” says the article.

Medicaid functions similarly to reverse mortgages for older adults, Salo told USA Today, as it enables low-income individuals to use their homes as collateral for government benefits they need. 

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Written by Alyssa Gerace