Dear Advocate:
Estate Recovery

Dear Advocate,

My mother is in a nursing home and is on Medi-Cal. She and I jointly own the house I live in. I’ve heard the state can come back and claim against the house after she dies. Is this true? If so, is there any way to protect the family home?

Sincerely,
Worried in Wawona

Dear Worried,

Yes, and yes! If your mother dies without a surviving spouse or a minor, blind, or disabled child, then Medi-Cal can recover against what’s in her name at the time of her death — in this case, her half of the house.

The best way to avoid recovery is to have nothing in the Medi-Cal beneficiary’s name at the time of death. Since an outright transfer can have tax and other consequences, this is not generally recommended. However, there are several alternatives, such as occupancy agreements or irrevocable life estates, that can avoid recovery, avoid probate, avoid tax consequences and still leave the beneficiary with the right to live in the home. Any such transactions should always be discussed with a qualified estate planning attorney.

If you need an attorney, CANHR has a statewide, state bar-certified referral service for attorneys specializing in estate planning for long term care. For more information, call CANHR at 800-474-1116.

From the Fall 2003 Advocate

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