Chad's Blog

Understanding Medicaid Estate Recovery

Posted by Chad Seiter | Aug 05, 2022 | 0 Comments

Understanding When the State Can Recover Medicaid Expenses

Planning for Medicaid, nursing home care, and the distribution of one's estate are complicated and challenging concepts. When it comes to Medicaid, one thing many people do not know is that the Commonwealth of Kentucky has the authority to collect the costs of Medicaid benefits paid on behalf of a person, from a person's estate when they pass away.

It can come as a shock to grieving families when the state comes knocking to collect for Medicaid expenses accrued during a person's life. However, under 907 Ky. Admin. Regs. 1:585, The Cabinet for Health and Family Services, Department for Medicaid Services, can in some cases seek reimbursement through a person's estate if they require long term care covered by Medicaid before passing away. The department may request to recover up to the amount that it paid out for required services.

Some Services That Could be Subject to Medicaid Recovery

  • Nursing home services
  • Home health and community-based services
  • Intermediate care for intellectual disabilities
  • Medicare premiums
  • Medicare cost-sharing
  • Costs for hospital services or physician services
  • Prescription drug costs

The estates of those aged 55 years or older that received any of the covered services can be asked to repay for Medicaid costs during the estate's administration period. For states, there is no option but to pursue these costs – the Federal government requires state Medicaid programs to seek recovery from the estates of those who received benefits from a state Medicaid program under many common scenarios.

While this can be an unwelcome surprise to family members trying to make sense of a relative's estate, it is something that must be done.

Fortunately, there are exceptions to the Medicaid repayment rule in Kentucky.

Estate recovery for Medicaid is not done when:

  • The deceased person has a surviving spouse;
  • The deceased person has a surviving child under age 21;
  • The deceased person has a blind or disabled child (of any age);
  • There is a legitimate hardship reason (for example, the estate is the only source of potential income for the surviving family);
  • The total assessed value is $10,000 or less;
  • A surviving family member has continuing education needs;
  • A surviving family member has continuing medical needs;
  • The recovery would not be cost effective.

Many people, upon learning of the Medicaid recovery rule for Kentucky, may seek to transfer property or find ways to shield assets before a person passes away. This can have negative consequences for the estate if not done properly, or done in bad faith. It is always best to talk to a trusted legal advisor before considering property transfers related to Medicaid eligibility or recovery.

Questions about the Medicaid Recovery Process? The Attorneys at Darpel Elder Law Can Help You Plan for Potential Medicaid Recovery Issues

The Northern Kentucky Elder Law Attorneys at Darpel Elder Law know the issues that families face when they are in the estate planning process. Some of these issues may be unexpected or difficult – including the possibility of Medicaid repayment after a long nursing facility stay. Our legal team will discuss all options, including eligible exemptions your loved one may fall within. Feel free to contact Darpel Elder Law with any questions you may have today. Call our office at (859) 341-4100, or visit our website at

About the Author

Chad Seiter

Attorney at Law


There are no comments for this post. Be the first and Add your Comment below.

Leave a Comment