By Robert C. Gerhard, III, Certified Elder Law Attorney
There are exceptions to estate recovery set forth in state and federal law. Remember that Pennsylvania’s Medicaid Estate Recovery Program only applies to long-term care benefits, such as for nursing home care, or in-home long-term care. There are cases where the Pennsylvania Department of Human Services will find undue hardship. Here are some of the more common exceptions:
The Estate Recovery Caregiver Exception
A major exception to the payback is a waiver of recovery against the decedent’s residence where certain caregivers:
- helped keep the decedent out of a nursing home for two years or more, or
- provided care and support to the decedent for at least two years while home- and community-based services were being accessed.
The caregiver must have resided in the home for:
- at least the two years immediately prior to the decedent’s entry to a nursing facility, or
- the two years during the administration of home- and community-based services.
Certain Income-Producing Property
The Department’s claim will also be waived on a hardship basis for a spouse, child, sibling, or grandchild with respect to income-producing property if the asset meets the following criteria:
- It is used to generate the primary source of income for the household.
- The family would have income below 250% of the federal poverty guidelines without use of the asset.
The regulations define an income-producing asset as property that is used in a trade or business such as:
- a family farm
- a family business
- a rental property.
Home Maintenance Expenses
The Department’s claim can be waived in cases where a person other than an estate creditor has advanced “necessary and reasonable expenses” to maintain the decedent’s home.
The regulations illustrate necessary and reasonable expenses for maintaining the home to include:
- real estate taxes
- utility bills
- home repairs
- home maintenance such as lawn care and snow removal necessary to keep the property in condition for the decedent to return home or to sell at fair market value
- additional reasonable may expenses may be approved, depending on the facts
Small Estates
In general, the Department will not pursue estates with a gross value of $2,400 or less.
Other exceptions. Other exceptions may apply to your estate depending on the facts.
Learn More. The direct path to secure answers to your estate recovery questions is to contact our law office for a consultation. The legal fee for the consultation is a permissible estate administration expense, paid ahead of the estate recovery claim under Pennsylvania’s priority statue. For additional details, read our full blog article on the Pennsylvania Medicaid Estate Recovery Program.
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Disclaimer: We recommend that you receive ongoing legal advice from an estate attorney before attempting to administer a trust or an estate. If you wish to secure our services to provide guidance and representation in connection with a trust or estate administration, please contact us.
