Obamacare time bomb: Government may recover your health care costs from your estate

by 1389 on January 19, 2014

in "Obamacare", 1389 (blog admin)

Death & Taxes

Our new Constitution is now established, and has an appearance that promises permanency; but in this world nothing can be said to be certain, except death and taxes.

Benjamin Franklin, in a letter to Jean-Baptiste Leroy, 1789

Newsmax has the story:

Millions of new enrollees are signing up for Medicaid due to its expansion under Obamacare, but many will be shocked to learn that their estates can be held liable for the costs of their healthcare.

As part of the 1993 budget reconciliation bill, Congress required states to implement the Medicaid Estate Recovery Program (MERP) to seek reimbursement of payments for nursing homes and long-term care facilities.

Obamacare, officially known as The Affordable Care Act, greatly expanded the services for which reimbursement can be pursued, and states can now use liens to recover money spent by Medicaid for services beyond long-term care.

States have discretion in how to implement the law, with some seeking to collect nearly all medical expenses.

Yevgeniy Feyman, a fellow at the Manhattan Institute, said the intent of the program was to discourage people from using Medicaid as a free long-term health insurance plan while hiding their assets.

“People who can engage in asset planning are not going to be effected by it, but there is going to be a flood of new people and most are not going to be aware that their estates and heirs could be held liable for their healthcare costs,” Feyman told Newsmax.

In October and November, the first two months of Obamacare implementation, nearly 4 million people enrolled in Medicaid, as the new healthcare law eased requirements to qualify for the program.

The Affordable Care Act effectively expanded Medicaid — designed as a program for low-income families — to all U.S. citizens and legal residents with an income below 138 percent of the federal poverty line in states that agreed to go along with the program. But individual states can set a higher threshold.

So far, 26 states and the District of Columbia have expanded their Medicaid programs. But many Republican governors have balked, citing the increased cost once federal aid diminishes.

Some states that expanded the Medicaid program are now trying to backtrack on the reimbursement rules.

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