Medicaid Estate Recovery in North Carolina

What is recovered

Nursing facility services, home and community-based services, hospital care, prescription drugs, and personal care services paid by NC Medicaid are recovered. Recovery cannot exceed the amount of assistance paid.¹

Who is subject to recovery

Recipients age 55 or older when assistance was received, and recipients of any age who were inpatients in a nursing facility, ICF, or other medical institution and could not reasonably be expected to return home.¹

When recovery is deferred or barred

Recovery is deferred while a surviving spouse is living, while there is a surviving child under 21 or a surviving child of any age who is blind or disabled, or while a qualified undue-hardship applicant continues to meet the criteria.¹

When none of these circumstances remains, the Department may resume recovery.¹

When the state does not pursue a claim

MA-2285 waives recovery when the total assets in the estate are less than $50,000, or when the total Medicaid benefits paid on the recipient's behalf are less than $10,000. Either threshold on its own is enough for the waiver.^{1, 2}

For deaths on or after January 1, 2023, the State Plan treats recovery as cost-effective only when gross estate assets before any disbursements, distributions or other payments are at least $50,000, the Medicaid claim is at least $10,000, and the expected actual recovery is at least $5,000.³

Undue-hardship waiver

A qualified applicant (a lineal descendant of the decedent, a brother or sister, a lineal descendant of a brother or sister, or an heir) may apply for a full or partial waiver or deferral. The Estate Recovery Administrator provides the list of documents the claim may require.^{1, 3}

A waiver is generally tied to property that is the sole source of income for a surviving heir, or to the applicant's residence, with household income below 200 percent of the federal poverty level.^{1, 3}

Liens on real property

NC Medicaid policy states that estate recovery does not include placing a lien on the property.¹

How the state files its claim

Recovery is not initiated until the beneficiary's death; the state then pursues recovery from the estate under N.C.G.S. 108A-70.5.^{1, 4}

The Department files its claim as a sixth-class creditor of the estate (N.C.G.S. 28A-19-6), and the claim is addressed as a debt of the estate before assets are distributed to heirs.¹

Governing law: N.C.G.S. 108A-70.5

Claim of undue hardship

within 60 days of the date of the notice of the Medicaid claim^{1, 2}

Written decision on an undue-hardship claim

within 10 calendar days of the end of the review^{1, 2}

Appeal of an undue-hardship decision to the Office of Administrative Hearings

within 60 calendar days of receipt of the decision^{1, 2}

Office of Administrative Hearings

Appeals by an heir who disagrees with an undue-hardship decision^{1, 2}

1. 1.NC Medicaid Aged, Blind and Disabled Manual, MA-2285 Estate Recovery, rev. 05/22/23
2. 2.MA-2285 Estate Recovery (PDF)
3. 3.State Plan Attachment 4.17-A, SPA 25-0011 Estate Recovery
4. 4.N.C.G.S. 108A-70.5