Estate Recovery Rules by State

After a person who received Long-Term Care Medicaid dies, the state must try to recover what it paid from the person’s estate. Federal law sets the minimum rules, but each state decides how far to go: which services it recovers for, what property counts as the “estate,” when it waives a claim and how the process works. This page summarizes the federal rules, explains the main ways states differ and gives a state-by-state table drawn from our state guides.

Figures change periodically. Double-check current amounts before relying on them.

The federal minimum

Under Section 1917(b) of the Social Security Act, every state must seek recovery from the estate of:

• a person who was 55 or older when they received Medicaid, at least for nursing facility services, home and community-based services, and related hospital and prescription drug services; and
• a person of any age who was permanently institutionalized, through the estate or the sale of a home with a lien.

States may choose to recover for all Medicaid services received after 55, except Medicare cost-sharing paid through the Medicare Savings Programs.

When recovery must wait

Federal law says recovery may happen only:

• after the death of the surviving spouse, if any; and
• when there is no surviving child under 21 and no child of any age who is blind or permanently and totally disabled.

For a lien on the home, recovery also waits while a sibling who lived in the home for a year before the admission, or a child who lived there for two years and provided care, continues to live there.

Hardship waivers

Every state must have a process to waive recovery when it would cause undue hardship. States set their own criteria. Common examples include:

• the estate is a family farm or business that is the heirs’ main source of income;
• the home is of modest value;
• an heir would become eligible for public assistance if the claim were enforced.

Request the hardship waiver form right away and note the deadline, which can be short.

The biggest difference: what is the “estate”?

Federal law requires states to recover from the probate estate, meaning property that passes through the court process under a will or state law. States may choose an expanded definition, reaching property that passes outside probate, such as:

• property in joint tenancy with right of survivorship;
• life estates;
• living trusts;
• payable-on-death or transfer-on-death accounts.

In a probate-only state, careful planning can mean the estate is small or empty at death. In an expanded-estate state, the same planning may not help. See Estate recovery.

Other differences between states

• Which services. Some states recover only for long-term care; others recover for all services after 55, including managed care premiums.
• Liens. Some states place liens on the home of a permanently institutionalized person during life. Others do not.
• Small-estate thresholds. Some states do not pursue estates under a certain size or claims under a certain amount.
• Notice and process. Some states require the estate representative to notify the state or get a release before closing the estate.
• Surviving spouse’s estate. A few states try to recover from the estate of the surviving spouse after that spouse dies.

State-by-state summary

The table below summarizes the estate recovery section of each of our state guides. “Federal deferral and hardship rules” means our guide notes the federal protections and a hardship process, with no special rules flagged. Open the state guide for details.

How to read the table

• Probate estate only (for example California and New York, as our guides note) means property passing outside probate is generally not reached.
• Thresholds (for example Texas) mean small estates or small claims are not pursued.
• Liens (for example Missouri) mean the state may place a claim on the home during life in limited cases.
• A state listed with only federal rules may still have important details, such as an expanded estate definition. Check the state guide and the state’s estate recovery rules.

What families should do after a death

1. Notify the state if required. Some states require notice of the death, or ask for it during probate.
2. Get the claim in writing. The state should state the amount and the services included.
3. Check the math. Claims sometimes include services received before 55 or payments that should not be included.
4. Check the deferrals. Is there a surviving spouse, a child under 21 or a blind or disabled child?
5. Ask about hardship. File any waiver request on time.
6. Do not pay the claim from your own money. Heirs are not personally liable for a parent’s Medicaid costs, except to the extent they received estate property.

Planning to reduce estate recovery

Lawful ways to reduce or avoid estate recovery include:

• exempt transfers of the home to a spouse, a disabled child, a caregiver child or a qualifying sibling. See Sibling exemption;
• transfers to a spouse after approval, combined with the spouse’s own estate plan;
• in probate-only states, holding property in ways that pass outside probate, such as joint tenancy or a transfer-on-death deed, where allowed. See Lady Bird deeds;
• long-term care partnership policies, which may protect assets from recovery in proportion to the benefits paid;
• planning well ahead, outside the five-year look-back.

Each of these has risks and costs. Planning must match the state’s estate definition.

A worked example

Clara, 87, a widow, received four years of nursing home care paid by Medicaid. At her death, her only asset is her home, worth $210,000, held as joint tenants with her son.

• In a probate-only state, the home passes to her son by survivorship and is not part of the probate estate. The state has nothing to recover from.
• In an expanded-estate state, the state may claim against Clara’s share, half the home’s value.
• If Clara’s son had lived with her for two years before her admission and provided care, the home could have been transferred to him without a penalty during her life, avoiding the issue.

Common questions

Will the state take my parent’s house? It may make a claim on the estate, which can include the house, but not while a spouse or protected child is alive or, for a lien, while certain relatives live there.

Do I have to pay my parent’s Medicaid bill? No. The claim is against the estate, not the heirs personally.

Can the state recover for Medicaid I received before 55? Generally not, unless the person was permanently institutionalized.

Are life insurance proceeds recovered? If paid to a named beneficiary, they generally pass outside probate. In expanded-estate states, rules vary.

Does a will protect the home? No. A will governs probate property, which is the minimum estate every state reaches.

Getting advice

A Certified Medicaid Planner (CMP) can explain how your state’s estate recovery rules apply and plan to protect a home or other assets within the law.

Related guides

• Estate recovery
• Sibling exemption
• Lady Bird deeds
• Jointly owned homes

Last updated for 2026. General information only, not legal or financial advice. Medicaid Answers is a free educational resource published by Medicaid Answers Foundation.