Medicaid offices raid deceased homes to recover medical costs

WASHINGTON (AP) – As Salvatore LoGrande battled cancer and all of the pain that comes with it, his daughters promised to keep him within the white house with the pitched roof that he worked so hard for many years ago.

So Sandy LoGrande thought it was a mistake when, a 12 months after her father’s death, Massachusetts billed her $177,000 for her father’s Medicaid expenses and threatened to sue over his house if she didn’t pay up quickly.

“Home was everything,” LoGrande, 57, told her father.

But the bill and its accompanying threat weren’t a mistake.

Rather, it was a part of a routine process the federal government requires of each state: recovering money from the estates of deceased individuals who, of their final years, relied on Medicaid, taxpayer-funded medical insurance for the poorest Americans.

An individual’s home is often exempt from qualifying for Medicaid. However, it’s subject to the estate recovery process for people who find themselves 55 or older and used Medicaid to pay for long-term care, similar to a nursing home stay or home health care.

This month, Democratic MP proposed completely abandoning the “cruel” program. Critics say this system collects too little – about 1% – of the greater than $150 billion in Medicaid spends annually for long-term care. They also claim that many states don’t warn individuals who join for Medicaid that their families could face large bills and claims on their estate after their death.

LoGrande says she became involved in a two-year legal dispute with Massachusetts after her father’s death. Just a few years before his death in 2016, she turned to an area nonprofit for advice on caring for her elderly father. The group suggested she enroll him in Medicaid. She even remembers asking a couple of home, but was assured that the state would only search for a house if it sent her father to a nursing home.

“He would never sign a contract for something that would put his home in danger,” she said.

For years, her father received an annual notice of profit renewal from the state’s Medicaid office. She says it wasn’t until after his death, when a state claim for $177,000 got here in, that she saw the primary bill for his care, which included a brief hospital stay for cancer pain, medications and hospice.

“That just blew my guts,” LoGrande said. “It was unfair.”

In 2019, the state reached an agreement with LoGrandes and withdrew its claims on the home.

State policies regarding this recovery process vary greatly, according to the 2021 Medicaid and CHIP Payment and Access Commission Reportwhich makes policy recommendations to Congress.

Some states place a lien – a right – on your private home, while others don’t. Meanwhile, some Medicaid offices try to recover all medical costs from patients, similar to doctor visits or prescriptions, while others simply recover long-term care costs. In recent years, Alaska and Arizona have foreclosed on just dozens of properties, while other states are foreclosing on 1000’s of homes price tons of of tens of millions of dollars.

New York and Ohio led the nation in such collections, recovering a complete of over $100 million in a single 12 months, Dayton Daily News investigation found.

Some investigation for the Kansas program, released Tuesday by the Health and Human Services Inspector General, found that this system was profitable – it brought in $37 million and only $5 million was spent recovering the cash. However, the state didn’t all the time collect money from eligible estates.

Last month, a foundation from one among the medical insurance industry’s largest giants called on Massachusetts to change its process for collecting reimbursements for many Medicaid costs, going beyond the federal government’s minimum requirements for recovering long-term care expenses. The Blue Cross Blue Shield Foundation of Massachusetts has really useful that the state legislature pass a bill that will prohibit such additional collections.

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Wealth recovery “can perpetuate wealth disparities and intergenerational poverty,” said Katherine Howitt, director of Medicaid policy at the muse.

In Tennessee, which recovered greater than $38.2 million from greater than 8,100 estates last 12 months, Imani Mfalme found herself in an identical situation after her mother died in 2021.

As her mother’s early-onset Alzheimer’s disease progressed, Mfalme continued to take care of her. But in 2015, when Mfalme was diagnosed with breast cancer and required a double mastectomy, she began to consider other options. She arranged a gathering at her mother’s house with the local Medicaid office. The representative told her to empty her mother’s bank accounts – money that Mfalme had transferred to her mother as a part of her assisted living payments – in order that her mother would qualify for this system.

She recalls feeling somewhat offended through the meeting when the representative asked her thrice, “This is your mother’s house?” The representative, Mfalme said, failed to mention that after her death, she may be forced to sell the home to settle her mother’s Medicaid bills.

Currently, Tennessee’s Medicaid office says she owes $225,000, and the state is looking for a court order requiring Mfalme to sell the home to repay the debt.

Mfalme, now 42, said she wants to pay what she will, however the home is a selected problem. Her mother, a black woman, bought her dream home in Knoxville after she won a landmark discrimination lawsuit against her former employer, Boeing, for paying her lower than her colleagues.

“She fought hard for equal pay and equal rights. “Just seeing it torn away just because she was sick and I was sick is just devastating,” Mfalme said of her mother.

TennCare, Tennessee’s Medicaid office, said in an email to the Associated Press that it could not comment on specific cases.

A report by the Commission on Payments and Access to Medicaid and CHIP really useful that Congress repeal a 1993 law that required states to recoup money from estates, as a substitute making it optional.

Earlier this month, Democratic Rep. Jan Schakowsky of Illinois reintroduced laws that will have ended the mandate of the federal government. Schakowsky believes the rule is a lose-lose proposition for families who hand over their homes and taxpayers who don’t see much profit from recovery efforts.

“This is one of the most cruel and ineffective programs we see,” Schakowsky told the AP. “It’s a program that doesn’t work for anyone.”

In a deadlocked Congress, with some Republicans calling for limits on Medicaid eligibility, the bill is unlikely to gain the bipartisan support needed to change into law.

There is a minimum of one one who admits this rule doesn’t work: the person who created it.

Many people do not know in regards to the decades-old order, which was intended to encourage people to save for long-term care – otherwise they risk losing the equity of their home, explained Stephen Moses, who now works for the conservative Paragon Health Institute.

“The plan was to provide long-term care options for people who need long-term care, but you have to plan ahead to be able to pay privately so you don’t end up in a public health care program,” Moses said.