I-Team: Medicaid's claim on homes leaves thousands in limbo, sparking legislative action

SYRACUSE, N.Y. — Your tax dollars provide healthcare for the poor through a program called Medicaid. But did you know that in some cases, when a Medicaid recipient dies, it's also Medicaid that seizes the family home of that person?

This happens to tens of thousands of families across the United States.

Last month, the I-Team brought you the story of Ellen McCauley, who is dealing with this after the loss of her mother. "We knew that her greatest wish was that this house was our inheritance, my sister Mae and I," she told CNY Central. But that wish is not coming true. In 2019, Ellen's mother's health declined and she passed away in January of 2023. Medicaid then came looking to collect what they paid for her care.

It wasn't until my mother died that we got a letter from Medicaid saying they put a $202,000 lien on this house on West Onondaga.

A lien is a right to keep property belonging to another person until a debt owed by that person is paid. In McCauley's case, that property is her mother's house and Medicaid is legally working to recoup the money spent on her care.

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Federal Medicaid rules state Medicaid programs must recover certain Medicaid benefits on behalf of the person enrolled. That can mean seizing property.

A spokesperson for the New York State Health Department says applicants are informed of this possibility when they apply for Medicaid.

The latest annual report on this program in New York State shows that $119 million came in from estate recoveries in 2022.

The I-Team got in touch with Rep. Jan Schakowsky, who serves people in Illinois' 9th congressional district.

She's proposing the Stop Unfair Medicaid Recoveries Act hoping to end the policy and reassure families receiving care from Medicaid that it won't lead to financial repercussions later.

"This is the only public benefit program that turns around and says, 'Well guess what? The people who live after you die are going to have to pay the money back,'" said Rep. Schakowsky. "The recovery of the money is almost non-existent. Only about 1% of the money ends up back in the hands of Medicaid."

The numbers back that statement up according to a 2021 survey report on Medicaid estate recovery by the Medicaid and CHIP Payment and Access Commission.

In New York, for example, the report shows between 2017 and 2019 Medicaid went after more than 100,000 estates. Of that, only 15,000 were recovered.

Families like McCauley's know they can't afford to pay the lien on her mom's house. So they're stuck in limbo.

"While you're mourning your loved one, getting the news that you have to come up with often hundreds of thousands of dollars. It's wrong," Rep. Schakowsky said.

Three New York congressional reps co-sponsor her bill: Reps. Yvette Clarke (NY-09), Alexandria Ocasio-Cortez (NY-14) and Paul Tonko (NY-20).

Rep. Schakowsky hopes to get this bill passed by the end of the session, to save more families from hardship from a policy that the I-Team still can't find anyone benefitting from.