Five elder advocacy groups are calling on Congress to eliminate Medicaid estate recovery after a congressional advisory commission recently concluded that estate recovery recoups a tiny percentage of spending while contributing to generational poverty and wealth inequity.
“The burden of estate claims falls disproportionately on economically oppressed families and communities of color, preventing families from building wealth through home ownership, which has been historically denied to communities of color through discriminatory public policy,” the five groups – Justice in Aging, the National Academy of Elder Law Attorneys, the National Health Law Program, California Advocates for Nursing Home Reform, and the Western Center on Law & Poverty – write in a jointly authored Issue Brief, Medicaid Estate Claims: Perpetuating Poverty & Inequality for a Minimal Return. “Congress should amend Federal law to eliminate Medicaid estate claims. Alternatively, the law should be amended so that states have the choice of whether to use Medicaid estate claims, as recommended in a recent report to Congress by the Medicaid and CHIP Payment and Access Commission (MACPAC).”
Current federal law requires that state Medicaid programs attempt to recover long-term care costs from the estates of deceased recipients. Due to Medicaid’s strict resource requirements, the only thing of significant value that most Medicaid recipients own at their deaths are their homes, which are an exempt asset for determining Medicaid eligibility.
In its March 2021 report to Congress, MACPAC recommended that Congress amend Section 1917(b)(1) of Title XIX of the Social Security Act to make Medicaid estate recovery optional for states. The group, a non-partisan legislative branch agency that provides analysis and recommendations to Congress, the U.S. Department of Health and Human Services (HHS) and the states, also recommends that states that provide long-term care under managed care models be allowed to pursue recovery based on the beneficiary’s actual cost of services rather than the capitation payment when the cost of care is less, and that HHS set minimum standards for hardship waivers under the Medicaid estate recovery program.
MACPAC advises that “[s]tates should not be allowed to pursue recovery for: (1) any asset that is the sole income-producing asset of survivors; (2) homes of modest value; or (3) any estate valued under a certain threshold.” The agency points out that estate recovery recoups relatively little—only about 0.55 percent of total fee-for-service long-term care spending.
Noting that “no other public benefit program requires that correctly paid benefits be recouped from deceased recipients’ family members,” the five advocacy groups call for the elimination of estate recovery “so that low-income families are better able to retain wealth and pass it on to future generations. Or, at a minimum, federal law should be amended to make estate claims voluntary.”
The Issue Brief details how Medicaid estate recovery keeps families in poverty, exacerbates racial wealth gaps, runs counter to efforts to create more affordable housing and, in managed care states, discriminates against recipients who use few services.
To read the Issue Brief, click here.
To read the relevant chapter of MACPAC’s report to Congress, click here.
For the full March 2021 MACPAC repot to Congress, click here.
Recent Comments