What is the name of your state (only U.S. law)? Connecticut
I posted a version of this in the Tax forum but see that it's more appropriate for this forum.
I recently read online that in some states such as Connecticut, Medicaid goes after the assets of the deceased, including non-probatable ones, to cover medical costs incurred while they were alive. In my brother's final three months of shuttling between hospital and nursing home, I expect the medical expenses reached $40,000 or more. He was poor and on Connecticut's Medicaid plan for the indigent (Husky Health, Plan D). To help provide an income for him before he fell sick, my mother paid for and started a $215k, single-life-with-cash-refund annuity for him, naming my other brother as beneficiary for what now is worth about $168k. She also gave my now-dead eldest brother a remainderman share in a condo with the share worth about $43,000 and that share transferred to me in the event of his death via joint tenancy with right of survivorship. He was living in the condo where the $215k annuity paid for its monthly fee and utilities. We will soon list the condo for sale. My mother is still alive and is acting as the fiduciary / petitioner in filing Connecticut's Form PC-212, Affidavit in Lieu of Probate, along with the required Form CT 706-NT Non-Taxable Estate Tax Return. Shortly after receipt of the filing, the probate judge scheduled a hearing for later this month and cc'ed the notice, along with the PC-212 to the Collection Services Unit of the Connecticut Department of Administrative Services ("DAS").
Questions: (1) Is it unlikely that Medicaid will claw back its expenses from these two non-probate assets of an otherwise insolvent estate--where even the cost of cremation exceeded his total probatable assets? According to the following recent amendment to Connecticut law (via Obamacare), https://www.cga.ct.gov/current/pub/chap_319s.htm#sec_17b-93 .
Sec. 17b-95 (Formerly Sec. 17-83g). State’s claim on death of beneficiary or parent of beneficiary. Sums due pursuant to an annuity contract.
(a) ..."Notwithstanding the provisions of this subsection, effective for services provided on or after January 1, 2014, no state claim pursuant to this section shall be made against the estate of a recipient of medical assistance under the Medicaid Coverage for the Lowest Income Populations program [emphasis added], established pursuant to Section 1902(a)(10)(A)(i)(VIII) of the Social Security Act, as amended from time to time, except to the extent required by federal law.”
Does my interpretation seem correct, or should I be concerned? My dead brother also had $12k in debt to the IRS from '10 and '11 for penalties from early withdrawal of an inherited IRA. Could the IRS also come after its debt from the surviving brother beneficiaries by putting, e.g., a tax lien on the condo?
(2) Is a DAS representative likely to attend the hearing, or is such a carbon copy of the hearing notice and PC-212 petition merely pro forma? According to Connecticut General Statute, Sec. 45a-273 (Settlement of small estates without probate of will or letters of administration), "If the petitioner indicates in such affidavit that the decedent received public assistance or institutional care from the state of Connecticut, the court shall not issue a decree until thirty days after notification to the Department of Administrative Services (DAS)". The thirty day period would expire about ten days after our hearing date.
I posted a version of this in the Tax forum but see that it's more appropriate for this forum.
I recently read online that in some states such as Connecticut, Medicaid goes after the assets of the deceased, including non-probatable ones, to cover medical costs incurred while they were alive. In my brother's final three months of shuttling between hospital and nursing home, I expect the medical expenses reached $40,000 or more. He was poor and on Connecticut's Medicaid plan for the indigent (Husky Health, Plan D). To help provide an income for him before he fell sick, my mother paid for and started a $215k, single-life-with-cash-refund annuity for him, naming my other brother as beneficiary for what now is worth about $168k. She also gave my now-dead eldest brother a remainderman share in a condo with the share worth about $43,000 and that share transferred to me in the event of his death via joint tenancy with right of survivorship. He was living in the condo where the $215k annuity paid for its monthly fee and utilities. We will soon list the condo for sale. My mother is still alive and is acting as the fiduciary / petitioner in filing Connecticut's Form PC-212, Affidavit in Lieu of Probate, along with the required Form CT 706-NT Non-Taxable Estate Tax Return. Shortly after receipt of the filing, the probate judge scheduled a hearing for later this month and cc'ed the notice, along with the PC-212 to the Collection Services Unit of the Connecticut Department of Administrative Services ("DAS").
Questions: (1) Is it unlikely that Medicaid will claw back its expenses from these two non-probate assets of an otherwise insolvent estate--where even the cost of cremation exceeded his total probatable assets? According to the following recent amendment to Connecticut law (via Obamacare), https://www.cga.ct.gov/current/pub/chap_319s.htm#sec_17b-93 .
Sec. 17b-95 (Formerly Sec. 17-83g). State’s claim on death of beneficiary or parent of beneficiary. Sums due pursuant to an annuity contract.
(a) ..."Notwithstanding the provisions of this subsection, effective for services provided on or after January 1, 2014, no state claim pursuant to this section shall be made against the estate of a recipient of medical assistance under the Medicaid Coverage for the Lowest Income Populations program [emphasis added], established pursuant to Section 1902(a)(10)(A)(i)(VIII) of the Social Security Act, as amended from time to time, except to the extent required by federal law.”
Does my interpretation seem correct, or should I be concerned? My dead brother also had $12k in debt to the IRS from '10 and '11 for penalties from early withdrawal of an inherited IRA. Could the IRS also come after its debt from the surviving brother beneficiaries by putting, e.g., a tax lien on the condo?
(2) Is a DAS representative likely to attend the hearing, or is such a carbon copy of the hearing notice and PC-212 petition merely pro forma? According to Connecticut General Statute, Sec. 45a-273 (Settlement of small estates without probate of will or letters of administration), "If the petitioner indicates in such affidavit that the decedent received public assistance or institutional care from the state of Connecticut, the court shall not issue a decree until thirty days after notification to the Department of Administrative Services (DAS)". The thirty day period would expire about ten days after our hearing date.
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