A recent amendment to Section 369 of the Social Services law expands the list of assets which are considered to be in an individual’s “estate,” against which Medicaid could make a claim for recovery, to also include jointly held property, retained life estates, interests in trusts and any other property in which the individual has any legal title or interest at the time of death.

This could impact retained life estates, any trusts in which a Medicaid recipient is beneficiary and any other property in which a Medicaid recipient has an interest at the time of death.  The budget legislation was passed on March 30, 2011. Regulations governing the new law are expected, but have not yet been issued.

The provision defining the term estate, in section 369 (6) of the Social Service Law, prior to March 30, 2011, was as follows:

For purposes of this section, the term “estate” means all real and personal property and other assets included within the individual’s estate and passing under the terms of a valid will or by intestacy.

The new provision expands estate recovery to also include retained life estates, joint property and interests in trusts:

An individual’s estate also includes any other property in  which the  individual  has  any  legal title or interest at the time of death, including jointly held property, retained life estates, and interests in trusts, to the extent of such interests

The precise wording of the new section is as follows:

Subdivision  6  of  section 369 of the social services law, as  added by chapter 170 of the laws of 1994, is amended to read as follows: For purposes of this section, [the term] an  individual’s “estate” [means]  includes all of the individual’s real and personal property and  other assets [included within the individual’s estate and] passing under the terms of a valid will or by  intestacy.    Pursuant  to  regulations adopted  by  the  commissioner, which may be promulgated on an emergency basis, an individual’s estate also includes any other property in  which the  individual  has  any  legal title or interest at the time of death, including jointly held property, retained life estates, and interests in trusts, to the extent of such interests; provided, however, that a claim against a recipient of such property by distribution or  survival  shall be  limited  to  the  value  of  the  property received or the amount of medical assistance  benefits  otherwise  recoverable  pursuant  to  this section,  whichever  is  less.    Nothing  in  this subdivision shall be construed as authorizing the department or a social services district to impose liens or make recoveries that  are  prohibited  by  federal  laws governing thr Association e medical assistance program.

(My thanks to the New York Bar Association Elder Law Section for providing information about the recent expansion of the Medicaid estate recovery law.)