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What is MERP and Will It Impact My Estate?

MP900398747The Medicaid Estate Recovery Program, also known as MERP, is something that every family needs to know about, if they have a loved one who may need Medicaid to pay for their long-term care.

Medicaid does seek recovery of funds that are expended for providing long-term care.

You’ll never get a notice that Medicaid (let’s say in the State of Texas) is calculating a bill for mom’s entire healthcare tab that Medicaid paid. However, you may get a notice that says the state wants mom’s house. That’s because Medicaid is asking to be reimbursed for over $125,000 that was spent for the mother’s care and her prescriptions.

The document may come from the Medicaid Estate Recovery Program (MERP) that says the state Medicaid program wants the money used for her care, because his mother owned the house.

The Houston Chronicle’s recent article, “Is Medicaid a good long-term care option?” emphasizes that we should all know about the MERP (Medicaid Estate Recovery Program), especially if it seems that our aging parents may need to apply for Medicaid for long-term care.

A Medicaid attorney can answer questions from adult children who are shocked when they find out the state has put a lien on their parent’s house because of long-term care health-care cost for which the specific state paid. Medicaid long-term care can be care can be provided at home, at an assisted living facility, or personal care at home or in a nursing home. It also doesn’t matter when the Medicaid system has paid for the mom’s care.

Medicaid can recover any and all medical expenses which include any hospital services, prescription drugs and even Medicare cost sharing expenses which are Medicare premiums (Part A—hospital insurance, Part B—medical insurance), deductibles and coinsurance amounts that the state’s Medicaid has paid.

Any claims against the estate, and that includes MERP claims, must be paid before assets can be distributed, according to the will. You won’t be required to sell the decedent’s home, if the MERP claim can be paid with other funds. However, if that’s the only available asset available, it may need to be sold, or the state may file a lien against the house.

The best approach is to speak with a Medicaid or elder law attorney in advance, so that planning can be done. There are strategies that can be used. However, a plan needs to be created in advance that meets all state and federal requirements.

Reference: Houston Chronicle (May 29, 2019) “Is Medicaid a good long-term care option?”