Can Medicaid Take Away Home

Can Medicaid take your home? - 8/12/08

Can the state take away your home? I want to tell you a sad but true story that happened just last week. Only the names have been changed to protect people's privacy.

Robert called my office in a panic. His wife of 50 years had died, after spending the last couple of years in a nursing home. They had spent down their life savings until nothing was left, then his wife had gone on Medicaid.

After his wife's death, Robert had signed two contracts, one selling his current home, and the other buying a trailer which was to be his new residence. The sale price for his current home was about $35,000, and the proceeds were needed to pay for his new property.

Both deals were set to close the next week. So why was Robert in a panic? He had just been told that he wasn't going to be able to get the $35,000 from the sale of his home. The money would have to be placed in escrow, because the State had recorded an Affidavit against the property saying that Robert owed the state more than $100,000 for his wife's Medicaid. And since he wouldn't get the money from the sale of his home, he couldn't buy the new property.

So here's what Robert was facing: in several days his home would be sold, and he'd have to move. But he couldn't get the money to pay for his new trailer, so his purchase would fall through. He'd have no money, and no place to live. All because his wife went on Medicaid.

There was only one problem: The state's action was illegal. The State of Ohio could not legally take Robert's home, or the home's sale proceeds, while Robert was alive. Ohio has an estate recovery law that allows the state to take a person's home and sell it in order to reimburse the State for previous Medicaid payments. But under both state and federal law, that cannot be done until you've died. And Robert's case demonstrates the reason why: we don't want people thrown out onto the street just because a spouse became ill and needed nursing home care.

Now, Robert's stay has a happy ending. Our office called the Attorney General's office and explained that the state was acting illegally. And the problem was immediately corrected. Robert got his money and bought his new trailer.

But what about all the "Robert's" out there whose homes are being wrongfully threatened? And who don't know to call a lawyer?

Don't let this happen to you. Don't let the state illegally take your house! Watch Golden Opportunities every week, and make sure you know your rights.