Medicaid Estate Recovery Update

In his recent email blast, Duane Reynolds of our office wrote about Michigan’s new “estate recovery” program, the purpose of which is to recover Medicaid benefits paid to individuals over the age of 55. Michigan’s program became effective July 1, 2010, and the state assumed it could begin filing recovery claims against decedent’s estates from that date forward. A decision rendered in the Clinton County Probate Court on April 30, 2012, however, said otherwise.

In Michigan Department of Community Health vs. Estate of Kathryn M. Slemka-Shire, Judge Lisa Sullivan dismissed the Department’s Medicaid benefit recovery claim simply because it failed to give the required statutory notice. The statute states that certain information about estate recovery and hardship waivers must be given to an individual at the time he or she enrolls in Medicaid. In the Slemka-Shire case, however, the required notice was not even developed until months after Ms. Slemka-Shire’s death.

Judge Sullivan’s dismissal of the case means that although Michigan’s estate recovery program technically became effective July 1, 2010, it cannot be utilized to recover benefits paid prior to approximately November 2011, which was when the Department of Community Health began disseminating the required notice.

The state has said that it will appeal the judge’s decision. Many in the legal community are hopeful, however, that her well-reasoned decision will withstand the challenge. In any case, estate recovery is a new program being implemented under a new statute. There are bound to be occasional mistakes and disagreements as to its application. Please don’t hesitate to contact us if you have any questions about the program or how it might apply to your situation.

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