How Going on Medicaid Could Cost You Your House

Since the Affordable Care Act expanded Medicaid eligibility, more than 11 million new enrollees have signed up for the program. You or a family member may be among them.

Medicaid helps pay medical costs, of course. But there’s a catch – a rather big one. States can seek to recover most of their Medicaid outlays from deceased recipients who are 55 or older. That means state governments can pursue assets in an estate.

Some states will even go after the houses where Medicaid patients lived.

That may be enough reason to decline Medicaid benefits. Or to sell a home and rent instead. It’s certainly enough reason to consider asset protection strategies. Some Medicaid recipients over 55 sell their home to their children, then rent it back from them. An estate planning attorney in your state can help you identify Medicaid hazards and potential work arounds, such as asset protection trusts.