Health & Benefits

The federal government requires that states recover long-term care costs. When a Medicaid recipient dies, the state can recover the money that it spent on the Aid to the Aged, Blind or Disabled (AABD) program for the recipient. The money is recovered through the Illinois Medicaid Estate Recovery Program.  

Claims

Medicaid may file a claim against the probate estate of a deceased recipient. In particular, Medicaid may file a claim against the beneficiary's estate for the value of the medical assistance provided to them after they reached age 55. The state cannot, however, recover from the estate of a deceased Medicaid recipient when the recipient has a surviving, spouse, child under age 21, or blind or disabled child of any age. Also, the state cannot recover from an estate when:

• the estate is valued at $25,000 or less, or 
• the cost of selling the property is more than the property is worth. 

Some personal property can be exempt from collection by the state, such as life insurance policies with named beneficiaries and accounts that are payable on death. 

Liens

Starting on June 2, 2022, Illinois stopped using liens on real estate to recover for Medicaid assistance. 

Liens put on real estate before June 2, 2022, can still be used to recover Medicaid assistance. However, the state should not have put a lien on real estate if any of the following people were living in the home:

• The spouse,
• A child under age 21, 
• A blind or disabled child of any age, 
• A sibling with an equity interest in the home, or
• A child caregiver who meets certain requirements.

You can ask for a waiver of this lien if it means that a family member will suffer financial hardship. Specifically, the heir or beneficiary must show that recovery would cause them to become or remain eligible for state benefits such as SSI or TANF.