Reversing a lower court decision, the Idaho Supreme Court holds that the state can recover assets from the estate of a Medicaid recipient's spouse that were transferred to the spouse before the Medicaid recipient died. In Re Estate of Perry (Idaho, No. 38694, Aug. 9, 2012).
Martha and George Perry owned property together. Mrs. Perry entered a nursing home, and Mr. Perry transferred the property into his name. Mrs. Perry then began receiving Medicaid benefits. Mr. Perry died before Mrs. Perry, and the property was sold. After Mr. Perry's death, the state filed a claim against his estate seeking recovery of more than $100,000 in Medicaid benefits it had so far paid on Mrs. Perry's behalf.
The state asserted that because Mrs. Perry previously had an interest in the property during the marriage, the state could recover an amount equal to her ownership interest. An Idaho district court held that the definition of "estate" in federal Medicaid law does not permit the state to recover property interests the Medicaid recipient divested before death and that federal law preempted state law. The state appealed.
The Idaho Supreme Court reverses, holding the state can recover assets that were transferred before the Medicaid recipient died. According to the court, in light of the inclusive nature of federal law and the plain definition of "assets" -- which includes a spouse's resources as well as assets the recipient disposed of before death -- federal law does not preempt the state from recovering assets from both spouses' estates, including assets that were community property during the marriage.
For the full text of this decision, go to: https://www.isc.idaho.gov/opinions/mccormick38694.pdf
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