Don’t volunteer your home to the State of Ohio
WHAT IS ESTATE RECOVERY?
In 1993, the Federal Government enacted a broad new law to require states to recover from the estates of deceased individual for whom they provided care. Ohio adopted this law as well as all other states. In 2005, the Federal Government enacted the Budget Deficit Reduction Act and the State of Ohio, following their lead, adopted Amended Substitute House Bill 66. This law permits the State of Ohio to place liens on your homes, farms and other real estate for medical and other public benefits. A state appointed reform commission reported that this expanded program would bring in an additional 22 Million dollars annually. This law is intended to help the State solve its budget problems by charging you back for state benefits that you received, particularly Nursing Home benefits.
WHAT IS A LIEN?
A lien is any official claim or charge against real property for payment of a debt or an amount owed for services rendered. Generally, a lien is paid off from the proceeds of the sale when the real estate is sold. A mortgage is a form of lien.
WHAT ARE ESTATE RECOVERY LIENS?
By Federal law, the Ohio Department of Job and Family Services may impose a lien against the home and other real property to recover the costs of services they paid for in-home or nursing home care. Recovery can be from the estate of the individual whose care was paid for or from their spouse. The Ohio Attorney General has hired attorneys throughout the state to file claims to collect on these liens. This means, that your homes, farms and other real estate are now subject to liens that may prohibit you from selling or transferring your real estate to your children or others without first satisfying the lien. In a recent court case, Ohio Department of Job & Family Services v. Tultz provides that, unlike other liens, formal notice is not required and the lien takes effect on the very first day that benefits are paid on behalf of you or your spouse.
WHAT SERVICES ARE SUBJECT TO ESTATE RECOVERY?
The State will pursue recovering costs for medical assistance consisting of nursing home or other long term institutional services, home and community based services, hospital and prescription drug services provided while the recipient was receiving nursing facility or home- and community-based services. The states also have the option of recovering the costs of all services paid on the recipient’s behalf. Including, other benefits such as in-home medical benefits and reimbursement of your $96.40 a month Part B payments. We even had one client who informed us that his mother was charged $1.25 for each set of plastic silverware that she received with her Meals on Wheels food! His total bill from the State for these “in-home benefits” was over $40,000 and this did not include Nursing Home benefits.
HOW CAN I AVOID AN ESTATE RECOVERY LIEN?
There are ways to avoid these estate recovery liens without facing the problems listed above. Set up a free consultation to learn about our asset protection strategies.
WHAT ASSETS ARE SUBJECT TO ESTATE RECOVERY?
Until recently, Ohio was only permitted to collect reimbursement from an individual’s probate estate. However, the new Estate Recovery Law (House Bill 66) passed in 2005, permits the State to collect from non-probate assets including all real estate and personal property and other assets in which the decedent had a legal title or interest in at the time of death. This includes assets conveyed to a survivor, heir, or assign of the decedent through joint tenancy, tenancy in common, survivorship, life estate or other arrangement such as payable-on-death accounts, transfer-on-death accounts and even living trusts.
WHO ENFORCES THE COLLECTION?
The office of the Attorney General of Ohio established a Collections Enforcement Section to track and collect all revenue. Then in August 2003, the office of the Attorney General began utilizing local attorneys to assist in the Estate Recovery program. These attorneys are compensated based on the amount of their collections. A Columbus Dispatch newspaper article reported that the attorneys typically receive 20% of the recovery they collect. Today, the State has many attorneys to assist in recording these liens on real estate and pursuing assets following a Nursing Home benefit qualified recipient’s death.
HOW LONG DOES OHIO HAVE TO RECOVER THE CLAIM?
Generally, the State of Ohio is not bound by any statute of limitations to bring a claim. An older common pleas case, In re Moore (Franklin Co. CP 1958), 154 N.E. 2d 675, held that a claim by the Ohio Department of Mental Retardation for support was not barred by the one year claim presentment limitation of the Ohio Revised Code. The Department therefore has maintained the position that the one year claim statute does not bind it. More recently in 2001, a Summit County Court of Appeals affirmed the trial court’s ruling that the one year bar does not apply to the state.
WHAT IF THERE IS ALREADY A LIEN OR AFFIDAVIT FILED?
You do have options. In some cases the Lien or Affidavit has been filed improperly and must be removed. Some cases require judicial proceedings to demonstrate undue hardship. Other cases can be resolved utilizing out of court negotiations. You should always contact an experienced elder law attorney to determine the best option in your particular case.