Estate Recovery

Estate recovery only applies to Medicaid recipients who:

• Are age 55 or older, or
• Are under age 55 and live in a medical facility and will probably not return home.

An “estate” includes all:

• Real property, such as your house, land, etc.
• Personal property, such as household goods, personal effects, cars, etc. or
• Any other asset that you own at the time of your death. This includes items you own with someone else such as property, trusts, most annuities and retained life estates.

Medicaid repayment can be delayed if the repayment will create a hardship for your family. HHS decides, on a case-by-case basis, who gets a hardship. Your family will receive a letter about estate recovery and repayment and will have 30 days from when the letter is received to apply for hardship.

• Hardship exists for a person applying for the waiver when:
• The total household income is less than 200% of the federal poverty level for the size of the household, and
• The total household resources are not more than $10,000, and
• Recovering the resources of the “estate” denies your family of food, clothing, shelter or medical care that might put a person’s life or health in danger.

Medicaid repayment may be delayed if you have a spouse or a dependent child who is under age 21, blind or disabled at your death.

• According to federal and state law, the money that the Medicaid program pays on behalf of a Medicaid member, who was age 55 or older or in a long-term care facility, is a debt owed back to the state.
• Upon the death of the Medicaid recipient, the Medicaid program contacts heirs or files a claim against the decedent’s estate to seek reimbursement for the amount owed.

• The debt includes all payments made by the State for services or goods when the recipient was age 55 years or older or of any age and living in a long-term care facility, except for some payments made under the Medicare Cost Sharing program.
• The recovery includes the full amount of capitation payments made to a MCO, including medical and dental, even if the plan did not pay for any services.
• The recovery includes the full amount of capitation payments made to a managed care organization, including medical and dental, even if the plan did not pay for any services.
• To view a recorded presentation and slide deck that explains Iowa's estate recovery program, to include what costs are recovered visit the public meeting archive, click on "2023" under "Town Hall Materials and review the recording link and meeting materials for "October 19, 2023."

• Any assets owned by the deceased member or any interest in an asset that the member had at the moment before death are subject to recovery.
• Court costs, the cost of administrating the estate, funeral expenses, medical bills of the last illness, federal and state taxes can be paid prior to the estate recovery claim. The State’s Medicaid claim must be satisfied before any lower-class creditors or heirs receive any assets or money.

• No, Medicaid does not “take houses”. Medicaid is a potential claimant in the estate. Houses may need to be sold to pay the debts of an estate, regardless of whether Medicaid has a claim in an estate.

• Waivers of the claims for spouses, disabled children, and minor children delay payment until the death of a spouse or disabled child, or until a minor child turns 21. If there are enough assets to pay the claim when it is due, then the claim must be paid in full.

• Any person who receives assets from the estate can request a hardship waiver if recovery would create a hardship. The guidelines for a hardship waiver are in the Iowa Administrative Code for income, assets, and if the heir would be deprived of food, clothing, shelter or medical care such that life or health would be endangered.
• An heir’s reduced inheritance due to recovery is not considered a hardship.

• Please contact Iowa's Estate Recovery program at:
  • Phone: 877-463-7887
  • Medicaid Member Services
    • Toll Free: 800-338-8366
    • Des Moines Area: 515-256-4606  | 8:00 a.m. – 5:00 p.m., Monday – Friday