Nevada Medicaid Claims

Medicare payments for a Decedent's health care are considered "earned benefits" so Medicare does not have any claim to an estate when someone dies. BUT, Medicaid has a right to get paid back out of a person's estate for any medical expenses it ever paid on behalf of the dead person. Nevada probate courts vigorously protect the right of Nevada Medicaid to get paid back out of a person's estate. 

But wait: It gets even worse for some estates: Once Nevada Medicaid is notified that an estate has been opened in Nevada--and you can not open an estate in Nevada without notifying Nevada Medicaid--Nevada Medicaid demands information to determine if there was a predeceaed spouse. If a predeceased spouse received Nevada Medicaid benefits, Nevada Medicaid asserts a right to claim reimbursement for benefits paid to a predeceased spouse. 

How Nevada Medicaid claims against a predeceased spouse seem at times pretty wierd: Let's say Jack and Jill who are married jointly own a house. Jack dies after Nevada Medicaid paid $13,000 of his medical expenses. But Jack owns everything with Jill jointly so there is no probate when Jack dies. Then 8 years later Jill dies. Jill never had Nevada Medicaid pay any of her medical bills. But, when Jill's estate goes into probate, Nevada Medicaid asserts a right to get back the $13,000 it paid on behalf of Jack. This is wierd because when Jack died, Nevada Medicaid never liened the house. On the one hand, this is nice for Jill while she is alive. On the other hand, consider the consequences of Nevada Medicaid never liening the house: 

1. Immediately after Jill dies, if her children or heirs do a title search on the house the Nevada Medicaid lien will not show, and 

2. If the house had been put into a trust, I am not sure Nevada Medicaid would ever notice that Jill had died and assert its claim. 

More on the Issue of Whether Avoiding Probate with a Trust Avoids Nevada Medicaid Claims: The purpose of the most common trust is to avoid probate. When a person dies with a trust the Successor Trustee may or may not hire a lawyer to help them. Many Successor Trustees manage without using a lawyer. (The person setting up a Trust picks their most competent family member or friend to be the Successor Trustee.) If a lawyer is hired, he or she will recommend publishing a Notice to Creditors which will impose a 90 statute of limitations on unknown creditors of the dead person. I do not know if Nevada Medicaid monitors these publication. 

Practice Tip: Further complicating things, health care providers have a year to bill Nevada Medicaid so while Nevada Medicaid’s lien might be small at the time the estate is opened, it could be larger by the time the estate is ready for distribution.

Fortunately, Nevada Medicaid will settle their claim for full payment at any time in the probate process and once they settle, they will not hold the estate liable for future bills that come and Nevada Medicaid has to pay. In some cases family members are financially able to pay-off Nevada Medicaid for what it owed at the time the Decedent dies (or shortly thereafter) and then don’t have to worry about later bills coming in to increase the claim of Nevada Medicaid. This is just one of many examples in the probate process in which, if the family is able, a payment made at the beginning of the probate process can reduce the ultimate liability of the estate. 

Practice Tip: When a probate petition is filed, Nevada Medicaid must be sent a copy of the first page of the petition, a copy of the death certificate, and notice of the hearing on the petition. If the death certificate shows that the Decedent died widowed, the Nevada Medicaid staff will follow up with a request for information on the first to die spouse so it is helpful to provide that information to Nevada Medicaid when first mailing them the documents above.