Friday, December 13, 2013

Wyoming Supreme Court: Expanded Medicaid Estate Recovery Permits Lien to Attach

In Estate of Marusich, 2013 WL 6450238, decided December 10, 2013, the Wyoming Supreme Court ruled the state could recover costs for Medicaid from the community spouse's estate, where the property in question, the marital home, had been owned as tenants by the entirety at the death of the Medicaid receipient (husband). Key points include:

  • Wyoming has adopted "expanded" estate recovery to include any real property in which a care-receiving individual had any legal title or interest at time of death;
  • Home was titled to the individuals as "husband and wife," which created a "tenancy by the entirety" under state law;
  • Husband received Medicaid benefits during his nursing home stay, until his death in 2005;
  • Wife continued to live in the marital home until her death, intestate, in 2012.

The Court distinguished rulings in Minnesota and Tennessee, where the agencies were barred from applying expanded estate recovery in cases where the care-receiving spouse's interest in marital property was transferred by the Medicaid recipient into the sole name of his or her community spouse before death: 

"While Barg [752 N.W.2d 52 (Minn. 2008)] and Smith [2006 WL 2114250 (Tenn. Ct. App. 2006)] ultimately reached a result consistent with that sought by the Marusich Estate, they do not support the argument that the house should not be available for recovery. In fact, those cases compel the opposite conclusion.  Given Mr. Marusich owned an interest in the house when he died (unlike the reciepient spouses in Barg and Smith), it was within the Department's authority to file a lien even though his interest passed by operaton of law to Mrs. Marusich upon his death."

The outcome in Wyoming points to the significance of expanded Medicaid estate recovery, and the potential importance of estate "re-planning" once the first spouse enters into Medicaid-paid care

Estates and Trusts, Federal Statutes/Regulations, Medicaid, State Cases | Permalink

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