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Protecting the Family Home
Jack and Betty Jones have lived on their family farm in Connecticut for over 40 years.

Recently, Jack suffered a stroke and his doctor told him he needed nursing home care. “Finding a nursing home is not the problem,” Betty said when she came to our office. “There is a nursing home in town where my parents lived for several years. Our family was very happy with the care they received. My concern is finding the money to pay for his care.”

She starts to sob when she says, “I don’t want to lose our home. It has been in Jack’s family for years and we want to leave it to our children. I don’t have enough money to pay for very long, and if Jack applies for benefits, the state will take our home.”

She was told by a friend, whose mother was in a nursing home, that she would have to sell their home and spend the proceeds on nursing home care before she could qualify Jack for benefits.

One of her neighbors told her she would not have to sell their home, but upon Jack’s death, the state would take their home to reimburse itself for the Medicaid benefits they paid on Jack’s behalf. She asked, “What should I do?”

First, we told Betty the good news. “Betty, you do not need to sell to qualify Jack for benefits.” In Connecticut, an applicant’s residence is exempt if the applicant’s spouse continues to reside there. Second, the state will not take your home when he dies, but after both you and Jack pass away, the state does have a right to recover the benefits paid on Jack’s behalf. This process is called estate recovery.

Federal law requires each state to recover the costs of long-term care services from the estates of Medicaid recipients. In other words, each state has the right to make claim against an estate of an individual who receives Medicaid benefits.

In the case of a married couple, recovery cannot be made before the death of the surviving spouse. So, if Jack passes away before Betty, the state will actually make a claim against Betty’s estate.

“Does that mean they will take my home after I die and that I cannot leave the house to my children?” she asks.

With proper estate planning, Betty may be able to pass the home to their children. This may be possible through trust planning, joint tenancy or gifting.

Unfortunately, it is not enough to simply avoid probate. Federal law actually allows states to expand the definition of “estate” to include any property an individual had at his or her death, including joint bank accounts, accounts with pay-on-death beneficiaries, life estates in real property, real estate held in joint tenancy and property held in living trusts. So, even non-probate assets are at risk.

Medicaid estate recovery rules are complicated and vary significantly from state-to-state. You should consult an elder law attorney who practices Medicaid law before drafting any type of estate plan with the intent of qualifying for Medicaid with the hopes of avoiding estate recovery.

Daniel O. Tully, Esq.


Kilbourne & Tully, P.C.

Connecticut’s Trusted Advocate for
Seniors and their Families

Office: Toll Free 860-583-1341

Bristol Office: 120 Laurel Street, Bristol, CT 06010
North Haven Office: 605 Washington Avenue, North Haven, CT 06473
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