Medicaid Estate Recovery in South Dakota

Medicaid Estate Recovery in South Dakota: key facts

Recovery scope

A debt is due for inpatient nursing facility, intermediate care, or other medical institution care at any age, and for nursing facility, home and community based, intermediate care, hospital, and prescription drug services received at age 55 or older (SDCL 28-6-23).

Who is subject

Estates of recipients who received covered services after July 1, 1994. A claim may also be filed against the estate of a surviving spouse for the recipient's covered benefits (SDCL 28-6-23, 28-6-23.1).

Recovery exceptions

The Department may not seek recovery while the recipient's spouse is living, or while there is a surviving child who is under age 21, blind, or disabled.

When exceptions do not apply

If the recipient owned or transferred assets that would have made the recipient ineligible, the Department seeks the full amount paid and the recovery exceptions do not apply (ARSD 67:48:02:06).

What counts as the estate

More than the probate estate. ARSD 67:48:02:01(2) reaches everything in the probate estate under SDCL 29A-1-201 plus any property the recipient held any legal title or interest in at death — including assets passing to a survivor, heir, or assign through joint tenancy, tenancy in common, survivorship, a life estate, a living trust, or other arrangement, and any balance left in a prepaid burial trust or account after reasonable burial expenses are paid.

Institutional settings covered

For the any-age institutional debt, ARSD 67:48:02:02 lists a nursing home, an intermediate care facility for individuals with intellectual disabilities, an adult foster care home, an assisted living center, a hospital swingbed, and an institution for individuals with a mental disease.

Long-term care partnership offset

If the recipient had a Division of Insurance-approved long-term care partnership policy that paid for services, the Department reduces the estate recovery by the assets disregarded when Medicaid eligibility was determined, less any disregarded assets disposed of before death. The reduction may not exceed the amount the policy paid (ARSD 67:48:02:05).

Who reports the death

The nursing facility or other facility completes the DSS Estate Recovery Program Notification of Death and returns it to the Department within 15 days of the date of death. It asks whether there is a surviving spouse, minor children, or disabled children, whether there is a will and who the executor is, and reconciles the resident's personal trust account against burial costs. It is not a family filing.

How the surviving spouse's estate is valued

On the DSS petition form, signed by the surviving spouse or the spouse's authorized representative or legal guardian. The Department values real property at 100 percent of the county's tax valuation (ARSD 67:48:02:08). A surviving spouse dissatisfied with that determination may request a fair hearing (ARSD 67:48:02:07).

Governing law: SDCL 28-6-23, 28-6-23.1; SDCL 29A-3-1201, 29A-3-817; ARSD 67:48:02

Steps to take when someone dies

1. Determine whether the deceased received covered Medicaid services after July 1, 1994 — institutional care at any age, or nursing facility, home and community based, intermediate care, hospital, or prescription drug services at age 55 or older.
2. Contact the DSS Office of Recoveries and Fraud Investigations to confirm whether a recovery claim applies and the amount of the debt.
3. Identify the non-probate assets as well — ARSD 67:48:02:01(2) counts joint tenancy, survivorship, life estate, and living trust transfers, and any prepaid burial trust balance left after reasonable burial expenses, as part of the estate for recovery.
4. Address the Department's claim as a debt of the estate — through the small-estate affidavit process or as a creditor claim filed with the Clerk of Court in probate — before distributing assets to heirs.
5. If a surviving spouse wishes to limit the spouse's estate liability, complete the DSS Petition to Limit Financial Responsibility of Surviving Spouse and file it with the Department within six months of the recipient's death (SDCL 28-6-23.1; ARSD 67:48:02:08).

Frequently asked questions