# summary --- If seniors utilize Medicaid, they run the risk of the state trying to recuperate the cost of their care through "asset recovery". This can include seizing a house that was owned by the senior, even if that was the only asset they had to pass on to their children. This is especially sad when you learn that the amount to be recouped is often higher than the benefits the senior actually *received*. The state pays insurance companies a set amount; those insurance companies often pay *less* for care provided. But the senior's estate still owes the state the full amount paid out, even if they didn't benefit from all of it. Meanwhile, this doesn't even balance out the cost of Medicaid. The companies hired to "recover" assets are expensive, and Medicaid recipients are often poor. This leaves many seniors confused and afraid to use Medicaid because they aren't sure if they're putting their legacy at risk by taking advantage of the aid offered. # highlights --- >In 1993, Congress passed a budget that required states to attempt to recover the costs of covering long-term care for Medicaid patients over the age of 55, after their deaths. >In some cases, the amount owed can be far greater than the actual cost of the services received, because of the role played in some states by [Medicaid managed care companies](https://ccf.georgetown.edu/2021/02/23/medicaid-managed-care-2020-results-for-the-big-five/)—the same health insurance companies we all know and love. These companies make money by spending less on the care of patients than the flat fee they receive from the state for that care. The companies pocket the difference, but the deceased’s family owes the entire, fake amount paid by the state. The state can also choose to charge interest on Medicaid estate recovery claims. >In a 2021 [survey](https://www.macpac.gov/wp-content/uploads/2021/03/Chapter-3-Medicaid-Estate-Recovery-Improving-Policy-and-Promoting-Equity.pdf) of states by MACPAC, the average value of recovered estates between 2018 and 2020 ranged from $2,768 in Missouri to $71,556 in Alaska. As of 2016, half of all Medicaid [recipients](https://www.kff.org/medicare/issue-brief/income-and-assets-of-medicare-beneficiaries-2016-2035/) had homes worth less than $70,950. The [median](https://fred.stlouisfed.org/series/MSPUS) sales price of a home in the United States last quarter was $440,300. >Many states use private contractors, like Health Management Systems (HMS), to conduct their estate recovery programs—contractors who sometimes make more money the more they recover. In Texas, the state’s most recent [contract](https://contracts.hhs.texas.gov/sites/default/files/documents/contracts/HHS000539200001-contract.pdf) with HMS, worth $4.8 million over three years, stipulates that the firm will receive an additional 11.5 percent of total recoveries. >Seniors are expected to either find a few hundred thousand dollars for nursing or home-based care, or become poor enough to qualify for Medicaid in perfect synchronization with their decline. >Even the biggest fiscal hawk couldn’t look at the numbers and think that reclaiming less than one percent of Medicaid costs is worth the real misery this causes. Perhaps, then, it’s less about recouping costs than it is about making sure those costs aren’t incurred in the first place, by leaving seniors confused, scared, and misinformed into declining benefits they are supposedly entitled to.