Medicaid Estate Recovery (MERP) is a federal program that allows states to recover Medicaid costs from the estates of deceased beneficiaries. Federal law since 1993 requires all 50 states and D.C. to establish these programs, though they operate with very different rules depending on where you lived.
For someone receiving Medicaid benefits, especially for long-term care, this means the state may try to collect what it paid for your care from your property after your death—unless specific protections apply. This matters because estate recovery can substantially reduce what you leave to your heirs, or force your family to liquidate assets to pay the state. Understanding when recovery applies, what your state actually pursues, and what protections exist can help you plan ahead and protect your home or estate.
Official resource:
- CMS Medicaid Estate Recovery — Use this page to check the study’s participation requirements.
Table of Contents
- Who Is Affected and When Recovery Occurs
- What Property Is at Risk
- Hardship Waivers and Your Right to Appeal
- State-by-State Variation and Planning
- Recent Policy Changes
- Frequently Asked Questions
Who Is Affected and When Recovery Occurs
Federal law requires states to recover costs for beneficiaries age 55 and older who received nursing facility services, home and community-based services, and related hospital and prescription drug services. States may also voluntarily pursue recovery for other Medicaid services for these beneficiaries, or even for younger recipients—and many do. A 2024 KFF survey found that 28 states pursue recovery from some individuals under age 55 (beyond the federal mandate), and 32 states pursue recovery for all Medicaid costs for people 55 and older.
Recovery applies only after the beneficiary's death, except for permanently institutionalized individuals, against whom states may place liens and attempt recovery while they are still living in a facility. This means if you are living at home in Medicaid-funded community care or received hospital coverage, the state cannot pursue your property while you're alive. If you are in a nursing home permanently, the state may place a lien on your home—a legal claim that must be satisfied if the property is sold or transferred.
What Property Is at Risk
which assets a state can pursue depends heavily on state law. Some states limit recovery to probate estates—assets in the deceased's name alone—while others conduct "expanded" recovery reaching jointly held property, living trusts, and non-probate assets, making the same person's estate recoverable in some states but not others.
The most significant protection is the home itself. A home cannot be claimed while occupied by the Medicaid recipient's surviving spouse, child under 21, blind or disabled child of any age, or (for a permanently institutionalized person) a sibling with an equity interest. This means if your spouse still lives there, or if a disabled adult child lives in your home, the state generally cannot force its sale to recover Medicaid costs. However, after the last protected person moves out or passes away, the state can move to recover the home's value.
Hardship Waivers and Your Right to Appeal
Every state must offer a hardship waiver—a process to ask the state not to pursue recovery if doing so would cause undue hardship. All 50 states reported having some waiver process when surveyed by KFF in March 2024, but the standards for what qualifies as "undue hardship" and how aggressively states pursue recovery vary widely.
you have leverage here. If recovery would force you to lose your home, prevent you from paying other essential expenses, or leave your family in genuine need, you can request a waiver. Each state defines undue hardship differently—some use a strict standard, others more flexible. When the state notifies your estate of a recovery claim, you (or your executor) should ask for a copy of the state's waiver policy and submit a written request if your circumstances qualify.
State-by-State Variation and Planning
Because Medicaid is jointly administered by states and the federal government, your state of residence determines how aggressively recovery is pursued. A person with an identical estate and identical Medicaid history may face aggressive recovery in one state and minimal pursuit in another. States differ sharply in scope: some pursue recovery only for nursing home and long-term care costs, while others pursue all Medicaid services, and some pursue recovery from beneficiaries under age 55.
To understand your own exposure, contact your state Medicaid agency and ask: These answers let you plan. Options like putting your home in a trust, adding a protected child's name to the deed, or establishing a life estate can sometimes shield assets from recovery—but only if done correctly and with full knowledge of your state's rules. An elder law attorney in your state can advise on what is permitted.
- Does the state pursue optional recovery beyond the federal mandate?
- What types of assets does your state pursue—only probate property, or jointly held and trust assets too?
- What is the state's hardship waiver standard?
Recent Policy Changes
State policy on estate recovery is beginning to shift. Ohio is proposing legislation (HB 318) that would bar the state from using optional recovery beyond federal mandates and would require waiving recovery when the cost is less than $20,000 or does not exceed recovery's administrative costs. Similar efforts are underway in other states to limit recovery or raise the threshold below which it is not pursued, recognizing that aggressive recovery can devastate families and sometimes costs more to pursue than the state actually recovers.
Frequently Asked Questions
Can the state take my house while I'm alive?
Only if you are permanently institutionalized; the state can place a lien on your home. For community-based care, recovery occurs after death. Your home is protected while occupied by your spouse, a child under 21, or a disabled child of any age.
Does the state have to prove I owe a debt before collecting from my estate?
No. The state notifies your estate of the amount owed and begins collection. You (or your executor) then have the right to request a hardship waiver or challenge the amount, but the burden shifts to you to prove undue hardship.
Can I protect my home by putting it in my child's name?
Possibly, but timing matters. Transfers made to avoid recovery can be challenged as fraudulent. Work with an elder law attorney in your state before making any changes; rules differ significantly by state.
Which states are most aggressive in pursuing estate recovery?
States vary widely. Some pursue optional recovery beyond the federal mandate (for younger beneficiaries or all services), while others limit pursuit. Check with your state Medicaid agency directly for your state's specific policy.