Michigan Estate Recovery and Your Home

Are you residing in Macomb, Oakland, Wayne, Ottawa or Kent County? Do you have a loved one or family member residing at a nursing home? Does he or she currently receive benefits from the State of Michigan in the form of long-term care Medicaid for nursing home care?

If the answer is “yes”, you may be exposed to estate recovery. Michigan adopted Estate Recovery, retroactively, for seniors that received Medicaid benefits. Estate Recovery is a law that entitles the State of Michigan to recover assets from an applicant’s estate if he or she received nursing home Medicaid benefits during his or her lifetime.

Although exemptions exist, the common target and biggest asset in an estate is a home. Homes are a protected or “non-counted” asset at the time of Medicaid application, but, now, following death, a home can become a target of recovery. The current statute, which may change, provides that the State may, effectively, lien the home through the probate process.

The law specifically provides that the state can recover up to half the value of a home capped at half of the mean value of a home in the geographic area it resides. Although the law seems to be specific, the Department of Human Services (DHS), and, the state fail to provide guidance in application of the formula to determine value. In fact, a separate independent agency serves as the state’s collection arm.

For now, the collection agency simply mails a questionnaire to assess the value of an estate that may be exposed to estate recovery. The questionnaire is flawed pursuant to creditor/debtor law and probate law, but still must be completed, to some degree.

If you have received a questionnaire or a letter of inquiry, do not panic. Often, the questionnaire will not apply as most homes and assets will escape the probate process through joint ownership, beneficiary designation, or effective estate planning; and, ultimately, will escape estate recovery. But the best advice is still to:

Call first… Act second.

The attorneys at Serafini, Michalowski, Derkacz and Associates, P.C. are ready to help. Serving southeast Michigan and metro-Detroit in Macomb, Oakland and Wayne County, through its Sterling Heights office; and, west Michigan in Kent and Ottawa County through its Zeeland office.

Free consultation, by appointment only, (586) 264-3756, (616) 931-3670, or, 1 (866) 529-ELDR.