This is a 10 part series on mistakes that people make surrounding Medicaid.
#1 Failure of awareness of the Colorado State Medicaid Recovery Rules
What is Medicaid Estate Recovery? When a Medicaid beneficiary dies, the value of their estate is used to pay back debts before transferring to any heirs. In other words after someone passes away, the state of Colorado aka Medicaid can file a claim against the estate of the person who died, for repayment of services during that person's life of being on Medicaid.
For example, a previous client received a benefit from their deceased parents' estate, opened the probate, paid it out to all siblings, paid out their share to themselves, and then, eight months later, received a letter stating that money was due in repayment of Medicaid benefits in the amount of $50,000. The money had already been divided between the siblings and spent. So how was the $50,000 going to be paid?
They did not understand that Medicaid needed to be notified as a creditor of the estate when a person passes away. All known creditors of the deceased have to be notified as part of the probate estate process. This individual was handling the probate and estate on their own without the assistance of an attorney. They did not notify the state and then eight months after the death of mom, they received the letter asking for payment.
This is ONE example of what can happen when you are not aware of the Medicaid Recovery Rules and processes. There are many more exceptions to be aware of.
We at Skipton Law would love the opportunity to help you manage your Estate and educate you on the various rules and exceptions that can save your family time, heartache and money. For more information on this and other Estate Planning topics, please contact us at 720-440-2774. We also provide free estate planning workshops that you can join. You can find information about that at https://www.skiptonlaw.com/workshops/.