1. ESTATE RECOVERY IS HERE: HOW
DOES IT APPLY TO YOUR CLIENTS
AND THEIR FAMILIES
Coldwell Banker Woodland-Schmidt
P. Haans Mulder, JD, MST, CFP®
Cunningham Dalman, P.C.
321 Settlers Road
Holland, MI 49423
(616) 392-1821
phmulder@holland-law.com

2. Background
• Attorney and Partner at Cunningham
Dalman, P.C.
• Have a Masters in Tax (MST), CFP®
and specialize in estates/elder law and
business planning.
Serving the Holland area since 1900

3. Background
• Cunningham Dalman, P.C. has been
serving the lakeshore since 1900.
• We have 15 attorneys specializing in all
areas of the law.
Serving the Holland area since 1900

4. Overview
• Discuss the Medicaid rules and process.
• Cover the what, who, when, where, and
how’s of Medicaid.
• What is estate recovery and why is it
important to your clients and their families.
Serving the Holland area since 1900

5. Overview
• What types of assets does estate
recovery apply to.
• How it might impact your business.
• How do your clients and their families
protect against it.
Serving the Holland area since 1900

6. What is Medicaid?
• It is a state and federal program that
pays for medical treatment (including
long term care).
• Oftentimes confused with Medicare.
Serving the Holland area since 1900

7. When does Medicaid apply?
• Historically, it only paid for nursing
home care.
• In certain counties (that have the MI
Choice Waiver program), it will pay for
care in someone’s home or in an
assisted living facility.
Serving the Holland area since 1900

8. Who does Medicaid apply to?
• Applies to people who are 65 years or
older, blind, or disabled.
• Must satisfy the medical requirements
(level of care assessment).
• Need to meet the income and asset
tests.
Serving the Holland area since 1900

9. Who does Medicaid apply to?
• A patient’s monthly income cannot
exceed the monthly cost of the nursing
home ($6-7,000 in this area).
• For the Waiver program, a patient’s
income (not a spouse) must be less
than $2,022/month.
Serving the Holland area since 1900

10. Who does Medicaid apply to?
• The asset test requires that a single
person cannot have more than $2,000
in countable assets.
• A patient can keep his or her home (as
long as its not in a trust) as well as a
vehicle.
Serving the Holland area since 1900

11. Who does Medicaid apply to?
• Asset test allows a married couple to
keep their home (again, if it’s owned
properly), a vehicle, and one-half of
their other assets (up to a maximum of
$109,560).
Serving the Holland area since 1900

12. What is estate recovery?
• It is a process that the State of Michigan
gets reimbursed for the Medicaid
services it has paid for.
• It does not put a lien (i.e. Medicaid lien)
on exempt assets during a patient’s life
or force a sale.
Serving the Holland area since 1900

13. What is estate recovery?
• It applies to people age 55 years or
older who have received Medicaid (i.e.
long term care) services.
• Covers Medicaid services back to
September 30, 2007.
Serving the Holland area since 1900

14. What assets does estate
recovery apply to?
• It only applies to assets that have to be
probated.
• That has the potential to include all
assets (house, bank
accounts, investments, vehicle, person
al property, etc.).
Serving the Holland area since 1900

15. What assets does estate
recovery apply to?
• But…the only assets that are typically
left are: bank account, personal
property (including vehicle), and a
patient’s house.
• The house will be the most significant
asset, but do not lose
sight of the others.
Serving the Holland area since 1900

16. What effect might this have
on your business?
• Estate recovery might incentivize
patients to stay at home longer.
• Patients might be more likely to sell
their house and have more liquid
assets for their care.
Serving the Holland area since 1900

17. How do people protect
against estate recovery?
• The most effective way to protect the
house is with a “ladybird deed.”
• The house remains an exempt asset
during the Medicaid recipient’s life.
• The costs and hassle of probate are
avoided.
Serving the Holland area since 1900

18. How do people protect
against estate recovery?
• What about other assets besides the
house.
• The patient should make sure those
assets avoid probate (i.e. having a
trust named as owner, naming a
beneficiary, etc.).
Serving the Holland area since 1900

19. Some other things to be
concerned about
• When a single person is on
Medicaid, he or she can keep the
house.
• However, he or she will not be able to
use Social Security and other income
to pay the house expenses.
Serving the Holland area since 1900

20. Some other things to be
concerned about
• This typically means that a child or
beneficiary must pay these expenses.
• Children should protect their right to be
reimbursed by executing and recording
a mortgage against the house.
Serving the Holland area since 1900

21. Some other things to be
concerned about
• This gives a child’s reimbursement
claim higher priority than the State of
Michigan’s estate recovery right.
• A child will get paid when the house
sells.
Serving the Holland area since 1900

22. Some other things to be
concerned about
• You should make sure the Medicaid
recipient has signed a financial (also
known as a general durable) power of
attorney.
• That way, the agent can execute the
mortgage.
Serving the Holland area since 1900

23. This is subject to change so
you have to stay informed…
Serving the Holland area since 1900

24. Stay informed by receiving
our monthly newsletter
(register by emailing
laura@holland-law.com)
Serving the Holland area since 1900

25. Questions……
Serving the Holland area since 1900

26. Thank You
P. Haans Mulder, JD, MST, CFP®
Cunningham Dalman, P.C.
321 Settlers Road
Holland, MI 49423
(616) 392-1821
phmulder@holland-law.com
mary@holland-law.com
www.holland-law.com
Serving the Holland area since 1900