Missouri Court Prevents Recovery From Community Spouse's Estate

A Missouri appeals court rules that the state Medicaid agency may not seek reimbursement for medical expenses from the estate of the spouse of a Medicaid recipient because Missouri's definition of estate does not include property held as tenants by the entireties. In re the Estate of Orville Bruce(Mo. Ct. App., No. WD68051, May 13, 2008).

Minnie Bruce received Medicaid benefits for 12 years until her death in 2002. She had no probate estate, and the home she shared with her husband, Orville Bruce, passed to him as a tenant by the entirety. When Mr. Bruce, who never received Medicaid, passed away in 2005, the state Medicaid agency sought to recover $150,000 from his estate under a Missouri law that allows estate recovery from the spouse of a Medicaid recipient. The circuit court allowed the state's claim, and Mr. Bruce's estate appealed.

On appeal, the estate argued that federal law preempted the Missouri statute and prohibited recovery from Mr. Bruce's estate. According the estate, nothing in the federal law allowed recovery from a spouse's estate. However, the state alleged that federal law does allow a state to broadly define what an "estate" is for Medicaid purposes, and that, under federal law, this definition could include property which is typically not considered a "probate" asset. The state claimed that Missouri's definition of an "estate" allowed recovery from the estate of a community spouse.

The Missouri Court of Appeals, Western District, reverses the trial court and prevents the state from asserting its claim against Mr. Bruce's estate. The court finds that federal law does preempt the Missouri estate recovery statute, and that Missouri's definition of an "estate" does not allow the state to bring a claim against property owned as tenants by the entirety. The court reasons that the state had not taken the steps required by federal law "to adopt a definition of estate for the purpose of Medicaid recovery to include such property."

For the full text of this decision, go to: https://attorney.elderlawanswers.com/in-re-the-estate-of-orville-bruce-mo-ct-app-no-wd68051-may-13-2008-6929

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