If a Massachusetts resident receives MassHealth (Medicaid) benefits and dies with assets in their estate, the state can — and does — make a claim against those assets to recover what it paid. For families who relied on MassHealth to cover nursing home costs, this can mean the loss of the family home. A significant law change signed in September 2024 (H.5033) modified how this works. Here is what your family needs to know — and what planning can protect you.

What Is MassHealth Estate Recovery?

Massachusetts participates in the federal Medicaid Estate Recovery Program (MERP), which requires states to seek reimbursement from the estates of deceased Medicaid recipients for long-term care costs paid on their behalf. In practical terms: if MassHealth paid for a nursing home stay, it may file a claim against the estate when the recipient dies — potentially claiming the proceeds from the sale of the family home.

Prior to 2024, Massachusetts had one of the broadest estate recovery programs in the country, seeking recovery from assets that passed outside of probate. H.5033 significantly narrowed that scope.

What Changed Under H.5033 (Signed September 2024)

The 2024 reform limits recovery to what is required under federal law — the probate estate of the deceased MassHealth recipient.

What is now better protected: Assets held in a properly structured living trust, assets with named beneficiaries (life insurance, retirement accounts, POD bank accounts), and property held in joint tenancy with right of survivorship are generally no longer subject to recovery under the new rules.

What remains subject to recovery: Assets that pass through probate — property solely in the deceased's name without a beneficiary designation or joint ownership — remain subject to estate recovery claims.

The practical implication: if your assets are structured to avoid probate, they may now also avoid estate recovery. But this requires planning — and it must be done before MassHealth benefits begin in most cases.

The 5-Year Look-Back Period

MassHealth has a 5-year look-back period. Any assets transferred within five years of applying for benefits can result in a period of ineligibility. This means planning must begin well in advance — ideally five or more years before long-term care may be needed. Waiting until a parent enters a nursing home is often too late to fully protect the estate.

Protecting the Family Home

For most Massachusetts families, the greatest concern is the family home. A South Shore home worth $500,000 to $800,000 represents decades of savings and an intended legacy. Options that may protect it include:

Irrevocable Medicaid Asset Protection Trust (MAPT): Transferring the home into an irrevocable trust more than five years before applying for benefits can remove it from the MassHealth estate — and now, under the 2024 reform, from estate recovery as well.

Caretaker child exception: If an adult child lived with the parent and provided care that delayed nursing home placement for at least two years, a transfer of the home to that child may be exempt from the look-back penalty.

Surviving spouse protection: The home is not subject to estate recovery if a surviving spouse is living in it at the time of the recipient's death.

Don't Wait Until a Health Crisis to Plan

MassHealth planning is most effective when started years before long-term care becomes necessary. Families who act five to ten years early have far more options than those who wait until a parent is already in a facility.

Sofio Law LLC — Estate Planning and MassHealth Planning

Attorney Jessica R. Sofio helps families throughout Plymouth County and Norfolk County protect their assets from MassHealth estate recovery through proper estate planning. Call today for a free, confidential consultation.

(774) 801-9774 | info@sofio.law
Serving Rockland, Hingham, Plymouth, Norwell, Scituate, Pembroke, Marshfield, and the South Shore.