New York’s Medicaid estate recovery law changed on April 1, 2024. The state can no longer recoup what Medicaid spent on routine health care after a recipient dies. Recovery is now limited to long-term care costs, mainly nursing home stays and home- and community-based services. If your relative was on Medicaid but never needed that kind of care, and died on or after April 1, 2024, the state has no claim against the estate.
What Medicaid Can and Cannot Recover Now
Before the change, New York could seek reimbursement from the estate of any Medicaid recipient who was 55 or older when they got benefits. That covered almost everything: doctor visits, hospital stays, emergency room care, prescriptions, short-term rehab, and the monthly capitation payments the state made to managed care plans. Someone who used Medicaid only for checkups could still face a claim.
The amendment to Social Services Law Section 369 removes that broad authority. General health care services are off the table. Only long-term care costs remain recoverable, and they fall into three categories set by federal law:
- Nursing facility services, meaning the room, board, and medical care provided in a nursing home. These produce the largest claims, since nursing home care in New York can exceed $15,000 per month.
- Home and community-based services, including personal care aides, assisted living program costs, and other supports that let someone receive long-term care outside a nursing home.
- Hospital and prescription drug costs directly connected to managing the long-term care condition. Unrelated hospitalizations and medications are not included.
Federal law requires every state to pursue recovery for these three categories for recipients aged 55 and older. New York cannot opt out without losing federal Medicaid funding. What the state gave up in 2024 was the optional, broader recovery that federal law also permits. The amended law now tracks the federal floor and nothing more.
Date of Death Decides Which Rules Apply
The trigger is the recipient’s date of death, not when services were provided or when probate opens. A recipient who died on or after April 1, 2024 gets the new, narrow rules. A recipient who died before that date is governed by the old rules, and the Office of the Medicaid Inspector General (OMIG) can still pursue the full range of medical costs Medicaid paid.
That line is sharp. An estate opened in 2023 for someone who died in March 2024 faces broad recovery. An estate opened at the same time for someone who died in April 2024 faces only long-term care recovery. Nothing about the probate timeline changes the outcome.
Only Probate Assets Are Reachable
New York limits recovery to assets that pass through the deceased recipient’s probate estate. Probate assets are things the person owned solely in their own name with no beneficiary designation: a house titled only to them, a bank account with no payable-on-death beneficiary, personal property.
Assets that skip probate stay out of reach. That includes jointly held bank accounts, real estate owned as joint tenants with right of survivorship, life insurance with a named beneficiary, retirement accounts with a designated beneficiary, and assets held in a living trust. None of these are part of the estate for recovery purposes.
If the estate’s probate assets are worth less than the Medicaid claim, the state recovers what is available and no more. It cannot pursue heirs personally for the shortfall.
Family Members Who Block or Delay Recovery
Even when long-term care costs are involved, federal and state law prohibit recovery while certain family members are alive. The state cannot pursue a claim if the recipient left behind any of the following:
- A surviving spouse.
- A child under age 21.
- A child of any age who is blind or has a permanent disability.
For the spouse and the qualifying child, recovery is deferred, not eliminated. Once the spouse dies, the minor turns 21, or the disabled child dies, the state can resume its claim against whatever assets remain.
Siblings Living in the Home
Recovery against the recipient’s home is deferred when a sibling with an equity interest in the property lived there for at least one year immediately before the recipient entered a nursing facility and has continued living there. The protection lasts only while the sibling stays. If they move out or the property is sold, recovery can proceed.
Caretaker Children
An adult child who lived in the recipient’s home for at least two years immediately before institutionalization, and who provided care that helped delay the move to a nursing facility, can also protect the home. The child must have remained in the home continuously since providing that care. As with the sibling protection, the deferral ends if the child leaves or the property is sold.
A caretaker child claim takes documentation. You will generally need a physician’s statement confirming the parent needed a nursing-home level of care, medical records supporting the diagnosis, and your own records of the caregiving you did. Tax returns, a driver’s license at the address, and utility bills help establish residency and timing.
Undue Hardship Waivers
New York must waive recovery, in whole or in part, when enforcing the claim would cause undue hardship to an heir or beneficiary. OMIG recognizes two specific situations:
- The asset is the beneficiary’s sole income-producing property, such as a family farm or family business, and the income it produces is limited.
- The property is the beneficiary’s primary residence, and its value is no higher than 50 percent of the average home selling price in the county where the home is located, measured as of the recipient’s date of death.
You request the waiver through the Estate Questionnaire that OMIG sends to the estate’s representative. Hardship has limits. OMIG will not grant a waiver just because a beneficiary cannot maintain their current lifestyle, and it will deny claims that arise from deliberate Medicaid planning or asset transfers.
What Happens When OMIG Files a Claim
OMIG usually acts after learning of the recipient’s death. It sends a Notice of Intent to File a Claim along with an Estate Questionnaire to the estate’s representative or a surviving family member. The questionnaire asks about the deceased’s assets, the estate’s value, and whether any exemption or deferral applies.
If the estate has no assets, or a qualifying exemption fits, say so directly in the questionnaire response. That response is also where you ask OMIG to consider an undue hardship waiver. From the questionnaire, OMIG determines its claim amount based on the long-term care services Medicaid paid for during the recipient’s lifetime after age 55.
In probate, the state acts as a creditor. Secured debts such as a mortgage are paid first, since the property cannot be sold without satisfying them. Funeral expenses and estate administration costs follow. The Medicaid claim is addressed before remaining assets pass to heirs. Whatever is left after those payments is what the family receives.