Estate Recoveries Unit
A lien is a document filed with the county registry of deeds that alerts anyone who wants to buy your house or land that you have a debt against the property, which must be paid when the home is sold, transferred or refinanced. Neither the type of ownership interest that you hold (such as joint tenancies and life estates), nor the timing of when that interest was created affects the Department's ability to place a lien when a lien would otherwise be appropriate.
When the State files a lien on your house, it does not mean that you must move or sell your house or that the State owns your house or wants to own your house. It means that when you sell, transfer or refinance the property, the State will collect on the lien that was placed on your house or land. The money recovered from this process goes to the State to pay back the medical and/or cash assistance that you received.
If you receive medical assistance, you live in a nursing home and your house or land is not being lived in by your spouse, minor or disabled child(ren), or sibling with an equity interest, the State will file a lien on that real estate to get paid back for the medical assistance that you received after age 55.
If you receive cash assistance and the property is jointly owned with your spouse, when the property is sold or refinanced the State will collect on the full amount of the lien, if the money from the sale is enough to pay off the lien. If the property is jointly owned with someone other than your spouse, the State will collect on the lien for cash assistance only up to the amount that equals your share of the ownership of the property. If you receive medical assistance and the property is jointly owned, the State will collect on the lien only up to the amount that equals your share of the ownership of the property.
If you are no longer on assistance and want to remove the lien, you can make a voluntary payment to the State in an amount equal to the assistance provided. Upon receipt of the payment, the State will remove the lien. Even if you no longer receive assistance, the State will only act upon the lien if you sell, transfer or refinance your property, or die.
In this context, an "estate" is all of the property (such as cash, savings, stocks, land, etc.) owned by a person at the time of their death. For the purpose of recovery of medical assistance, your "estate" includes both assets that pass through probate and assets that pass outside the probate process. This includes assets held in joint tenancy, tenancy in common, life estates and living trusts. However, the Department will not seek recovery after your death from life estates and joint tenancies with rights of survivorship created on or before July 1, 2005.
When a probate estate is opened for someone who received cash and/or medical assistance, the State may file a claim against the estate for repayment of the assistance received. The State will file a claim against your estate for the:
- Cash assistance you received, if the total assistance is more than $100; and/or
- Medical assistance you received after age 55, if you are unmarried or widowed at the time of your death and do not have any minor or disabled children. (NOTE - There is no recovery for Medical Assistance received prior to age 55.
Probate law provides that creditors, such as the State, must be paid before any directions in a will are followed. If any assets remain after paying all debts against the estate, the court will follow the directions of the will and allow assets to be given to your heirs. The State will collect on the funds that are available in your estate even if there is not enough to pay the claim in full. If repayment of medical assistance received would cause the family to experience a hardship, repayments are sometimes waived. Your family and/or the administrator of your estate can apply for hardship waiver and have the debt forgiven, if the hardship criteria are met.