Last week, California Governor Jerry Brown (D) vetoed a bill that would protect the estates of Medicaid beneficiaries in the state. (See WICs article, "CA Bill Would Protect Estates of Medicaid Recipients," August 29, 2014.) Brown explained the decision was made out of concerns over the state's overall budget, saying, "Allowing more estate protection for the next generation may be a worthy policy goal. The cost of this change, however, needs to be considered alongside other worthwhile policy changes in the budget process next year." California, like many states, authorizes its Medicaid program to recoup certain costs from beneficiaries' estates upon their death. The law would have shielded assets, including real property, from being subject to recoupment for basic medical services. (Federal law requires states to recoup the cost of institutional care.)
With the Medicaid program expanding in California and the majority of other states, many new Medicaid beneficiaries are surprised to learn of the laws that permit recoupment. As a result, some Medicaid beneficiaries say they are less likely to seek routine health services out of concern that the state can seize a portion of their estates.
Source: Kaiser Health News