Estate Recovery Law Repealed
April 23, 2012
This issue of the Koldin E-Newsletter reviews the Repeal of the recent Medicaid Estate Recovery Law.
On September 15, 2011, The Koldin Law Center, P.C. reported to you by e-mail newsletter that New York State enacted a new Estate Recovery law which authorized the Medicaid Agency to collect reimbursement for Medicaid paid out on behalf of a recipient from any Joint account, Payable on Death account, Trust or Life estate owned by the recipient. As a result of strong advocacy against this law by attorneys, including the Koldin Law Center, P.C., and by the New York State Bar Association, this harsh law was recently repealed!
The prior law has been restored which limits Estate recovery by the Medicaid Agency to assets that are owned solely by the Medicaid recipient which would pass to beneficiaries through his/her Will through Probate proceedings in Court. Therefore, to avoid Estate recovery, the Medicaid recipient must take steps to ensure that his/her assets are left to beneficiaries directly and not through his/her Will. It is important to plan in advance to avoid Estate recovery and the cost of Probate. The Koldin Law Center, P.C. can help you make the right decisions.
A Medicaid recipient in 2012 is entitled to keep $14,250 of his/her life savings. If these exempt funds are held in an account solely in the recipient’s name, then when the recipient dies, this account would pass through his/her Will (probate estate) and still be subject to an Estate recovery claim by the Medicaid Agency. However, under the law today, if the Medicaid recipient takes steps to avoid probate with this account such as designating a beneficiary on the account (TOD, POD or ITF), or making the account joint with someone else with right of survivorship, probate can be avoided and therefore Estate recovery can be avoided.
The Koldin Law Center, P.C. closely monitors the Medicaid laws and court cases to make certain our clients are well-informed of their options. The Koldin Law Center, P.C. reviews many different asset preservation options with our clients, including establishing an Irrevocable Family Trust. There is no fee for the initial consultation.