Florida's Medicaid Estate Recovery Program

Medicaid is a joint federal and state program that provides health care coverage for people with limited incomes. Whether directly or through a managed care provider, Medicaid often covers the cost of long-term care services, like nursing home care.

Federal law requires each state to have a "Medicaid Estate Recovery Program" to recoup at least some of these long-term care costs from the estates of deceased Medicaid recipients. States also have the option to request reimbursement for other Medicaid benefits paid on behalf of recipients over 55. (42 U.S.C. § 1396p(b).) Florida is one of the states that has opted to try to recover additional Medicaid spending.

Read on to learn which Medicaid benefits the state of Florida will try to seek reimbursement for, how estate recovery works in Florida, and how Medicaid estate recovery might affect your heirs.

Is Your Estate Subject to Florida's Medicaid Recovery Program?

Any cash, investments, real estate, or other property you own that is subject to the probate process when you die is part of your "probate estate." (Fla. Stat. § 731.201(14).)

Under Florida law, if you received Medicaid benefits after age 55, Florida's MERP program could try to go after almost anything in your probate estate to get reimbursed for your long-term care costs, depending on:

• its value
• who you're survived by, and
• whether it's exempt under the Florida constitution.

The state of Florida won't try to recover Medicaid costs from your estate if you're survived by your:

• spouse
• minor child (under 21), or
• child who's blind or permanently and totally disabled (as defined by 42 U.S.C. 1382c).

When you applied for Medicaid, the state of Florida should have provided you with a notice explaining the state's estate recovery rights. Sharing this information with your heirs before your death can help ensure they know what to expect when you're gone.

Which Medicaid Costs Must Your Estate Repay in Florida?

As required by federal law, the state of Florida tries to recover everything Medicaid paid for long-term care for recipients 55 and older, including the cost of:

• nursing home services
• intermediate care facility for the intellectually disabled
• other medical institutions
• home and community-based health services (HCBS), and
• related hospital and prescription drug services.

Florida will also try to recover all other Medicaid costs allowed by federal law. Under Florida's Medicaid Estate Recovery Act, anyone age 55 or older who receives Medicaid benefits is incurring a debt to the state—it's like a loan your estate must repay after your death. But the state doesn't consider any benefits you received before you turn 55 as part of that loan. (Fla. Stat. § 409.9101(3).)

That means your estate only has to repay the medical benefits you receive from Medicaid once you turn 55, but not those received when you were younger than 55.

Which Assets are Subject to Florida's Medicaid Estate Recovery Program?

Your estate contains everything you own when you die. That includes:

• real property, like houses and land
• vehicles, like cars, trucks, and vans
• farm equipment, like tractors and combines
• valuables, like jewelry and artwork
• personal property, like clothing and furniture, and
• financial assets, like bank accounts, IRAs, and stocks.

Because the state uses the probate process to get reimbursed for Medicaid spending, property that isn't part of your probate estate isn't subject to recovery. Your probate estate doesn't include:

• bank accounts or retirement accounts, if you named beneficiaries for them before you died
• property that you put in a living trust
• real estate that you owned in "joint tenancy" with someone else (it automatically passes to the other owner when one owner dies), and
• any other property that avoids probate.

Can the State of Florida Take Your House Before You Die?

No, Florida will not typically take your house for Medicaid purposes while you're still alive. Although Florida's Medicaid Estate Recovery Program (MERP) can sometimes force the sale of a home after your death, it usually won't do so while you're still alive.

The exception is if you're the sole owner of a house and you can't reasonably be expected to return home. Then, if you don't have a surviving spouse, surviving minor child, or surviving blind or disabled child, the state can place a Medicaid lien on your home. But if your sibling lives in the home and has an ownership interest in it, Medicaid can't place a lien on the property.

Are Other Assets Exempt from Florida's Medicaid Estate Recovery Program?

Florida's Medicaid Estate Recovery law has other exemptions too, some based on the state constitution. For instance, Florida's Homestead Exemption Law (Fla. Const. Art. X, § 4) protects certain property from being forcibly sold to pay off debts, except for taxes, mortgages, or contractor liens.

Under this law, your homestead is the home in which you, your spouse, and/or your dependent child(ren) live. The law exempts:

• the home and the land it sits on (up to 1/2 acre, if inside a town or city)
• the home and the land it sits on (up to 160 acres of connected land, if outside of a town or city), and
• up to $1,000 worth of personal belongings.

Florida's Medicaid Estate Recovery law exempts property that falls under the homestead exemption, so the state can't force your heirs to sell the home where you or your dependent family members live. (Fla. Stat. § 409.9101(7).)

How Does the Estate Recovery Process Start?

If you're 55 or older when you die, your family, attorney, or estate representative must notify Florida's Agency for Health Care Administration of your death—whether or not you ever received Medicaid. The person handling your estate should mail the notice and a copy of your death certificate to: Florida Medicaid Estate Recovery Program, PO Box 12188, Tallahassee, FL 32317-2188.

Each month, the state also obtains lists of the probate estates opened during the previous month, to look for names of Medicaid recipients.

The agency handling estate recovery will then determine whether you received any recoverable Medicaid benefits. If you did, the agency will file a claim with the probate court. (Fla. Stat. § 409.9101(3).) The court then notifies your estate attorney or personal representative of the claim.

After that, it's up to the probate court judge to decide how much, if anything, your estate must repay to Florida Medicaid.

Will Florida Waive Estate Recovery If It Would Cause a Hardship for My Family?

Florida Medicaid won't try to recover costs from your estate if doing so would cause an "undue hardship" for one or more of your heirs. The person representing your estate or any of your heirs can file a request for a waiver with the Florida Medicaid Estate Recovery Program. (Fla. Stat. § 409.9101(8).)

To get the Florida MERP to waive estate recovery, the person requesting the waiver will need documentation that proves at least one of the following is true:

• Your heir, who currently lives in your home:
• has used the home as a primary residence for the 12 months before your passing
• lived there when you passed away, and
• doesn't own another home.
• Your heir, who is your sibling or child:
• lived with you for at least a year before your death, and
• provided full-time care for you that kept you out of a nursing home.
• Recovering the estate would deprive your heir(s) of necessities, like:
• food
• clothing
• shelter, or
• medical care.
• The cost of selling your home would be equal to or more than the home's value. (Fla. Stat. § 409.9101(8).)

Learn More About Medicaid Estate Recovery in Florida

The Florida Agency for Health Care Administration contracts with a private company, Health Management Systems (HMS), to manage the state's Medicaid estate recovery program. You can learn more about the program online on the Florida Medicaid Estate Recovery website or by calling HMS toll-free at 877-357-3268.