Submitted by Glen Downs:
“So here’s the deal: since 1993 there has been a federal law requiring states to recover at least some of the costs of Medicaid-covered medical care for anyone 55 years old and up, from the estates of those covered.
States enforce this law, with their own laws and policies added in, differently in every state. But the general principle is there. Up until now the usual consequence has been things like this: Medicaid puts a lien on the house of someone in a nursing facility who has run out of money, and after they die, the heirs find they have to buy the house back from the state if they want it.
We haven’t had lots of people younger than 65 on Medicaid, because in most states simply earning less than the Federal Poverty Level did not qualify one for Medicaid.
And we haven’t had many people with lots of assets on Medicaid, because in most places you have to have less than around $2400 to your name before Medicaid will cover you. You can keep your house and your car, but Medicaid reserves the right to put liens on them and take them when you die.
But now we have the Affordable Care Act, and its expectation that everyone in the lower tier of income will end up in the Medicaid system. To accomplish this, they have dropped the asset test. So now we will have lots of people ages 55-64, who have assets but not a lot of income right now, for whatever reason, on Medicaid.
The kicker of it is, if you make the right amount to qualify for a subsidized health insurance plan, your costs are going to be shared and subsidized by the government. But if you go on Medicaid, you owe the entire amount that Medicaid spends on you from the day you turn 55.”
Quoting Daily Kos
