Medicaid and Estate Recovery

Medicaid is a federal medical assistance program for low-income people, which is administered by the state.   In Colorado, Health First Colorado administers our Medicaid Program.  Health First Colorado is funded jointly by a federal-state partnership and is administered by the Department of Health Care Policy and Financing.  Medicaid is public health insurance for those who qualify.  To apply for Medicaid, an application must be made with your County Department of Human Services, or an application assistance site, or online at Colorado.gov/PEAK, or by phone at 1-800-221-3943.  Nursing home residents apply in the county in which the nursing home is located, and there is usually assistance provided at the facility to help their residents make the application. 

There are many Medicaid programs which provide assistance to children, pregnant women, parents and caretaker relatives with a dependent child(ren) and adults.  You must be medically eligible for some programs and you must meet income guidelines; long term care programs also have asset limitations to qualify for Medicaid.  Income limits change annually and generally follow SSI income rules.  The Affordable Care Act established a Medicaid program based only on income and is sometimes referred to as MAGI (modified adjusted gross income).  MAGI rules apply to eligibility determinations for children’s health insurance programs (CHP+) and most programs, except for those programs for individuals over 65 years young and or for people who have a disability.

People who are over 65 and or disabled may apply for long term care coverage.  To qualify for long term care you must need assistance with at least 2 activities of daily living (eating, dressing, transferring, etc.), you must be 65 or older, and your income must be less than three times the current Federal Supplemental Security Income (SSI) limit per month.  As of  July 1, 2020 the income limit is $2,382.00.  The Medicaid applicant’s total resources may not exceed $2,000.  Some property does not count as a resource, it is exempt.  Examples of exempt resources are your residence, your car, irrevocable pre-paid burial plans and $1,500.00 of life insurance.  If the Medicaid applicant is married, the spouse of the Medicaid applicant is entitled to keep some of the joint assets, and his or her own assets.  

In Colorado, Medicaid covers most necessary medical services, including hospital, nursing home, physician, prescriptions, medical supplies and equipment.  In addition, some home services may be provided by Home and Community Based Services programs for specific groups.

Under the Colorado Estate Recovery Program, the State of Colorado may recover Medicaid expenditures from the Medicaid recipient’s estate after his or her death.  Under this program, the state may file a claim against an individual’s estate, including a lien on the home.  No action is taken against the property while the recipient or his or her spouse is still living.  The home may be protected from recovery if a surviving spouse or dependent child remains living in the home after the recipient’s death.  It is important to consult with an elder law attorney concerning these provisions since they are complex and subject to change.

Tamra K. Waltemath

This article was written by Tamra K Waltemath of Tamra K. Waltemath, P.C.  This information is for general informational purposes only and does not constitute legal advice.  For specific questions, you should consult a qualified attorney.  Tamra K. Waltemath is an elder law attorney focusing on wills, trusts, estate and trust administration, probate and non-probate transfers, guardianships and conservatorships.  She can be contacted at:  Tamra K. Waltemath, P.C., 3843 West 73rd Avenue, Westminster, CO  80030; 303-657-0360; or visit her website at: www.WaltemathLawOffice.com.