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Unexpected Medicaid Estate Recovery Hiccup (Part 3)

In this third post of three I finish telling you about the estate recovery problem we encountered with one of our clients. As I explained last week, when the client died and we asked the State what it was seeking to recover, what we got back was an amount triple what we expected.

When I examined the State’s printout it was immediately clear why. Medicaid was reimbursing the facility at the ventilator patient rate which is approximately triple the private pay rate for nursing residents who are not on a ventilator. My client, however, had never been on a ventilator. Clearly there had been a mistake in communication between the State and the facility.

Getting the answers and more importantly getting it straightened out would take time. We had to get it corrected because as I related to you last week, the proceeds from the sale of my client’s house had been placed in a special needs trust (SNT). Now that my client died, the State needed to be paid back all the benefits it paid out, or at least what was left in the SNT, if not enough to cover the full amount. If there was anything left in the SNT, it could then pass to the children.

I presented the State’s printout to the facility. It took some time but they confirmed that a mistake had occurred. As with any bureaucracy, however, it would take time to fix it. The State needed to generate a new statement showing what it should have paid the facility. This is the amount that my client’s children should reimburse to the State from the trust. The State also is entitled to paid back in full. That means the facility must repay the difference between what it wrongfully received and what it should have received in state funds.

The State estate recovery representative told me she had never seen this type of mistake in her experience and could not correct it herself. What that told me is that it would take some back and forth between the State and the nursing facility with my help but ultimately we would get things corrected and each party would get what they are entitled to, including my client’s children.