American Scandal, Obamacare, Medicaid, and their Stripping of Assets from Poor People

"Second is that enrollment in Medicaid is now mandatory. If you or your family make less that 138% of the Federal poverty level, which in the 48 states and Washington DC would be $16,105 for an individual and $32,913 for a family of four in 2014 you are enrolled unless you fit in a short list of categories, such as being in jail, being in a state that opted out of Medicaid expansion, or being a member of an Indian tribe. You cannot opt out of Medicaid because you object to the estate recovery. You have to pay the penalty if you want out. And there are many routes by which you can become enrolled: by applying on an exchange and having it determine your income is too low to qualify for private insurance; by being in the SNAP (food stamps) database; by having an Obamacare plan but having a fall in income that puts you in the Medicaid category."

In June 2013 a letter was sent to the Centers for Medicare & Medicaid Services by a well-informed citizen pointing out that the Medicaid Manual prepared by CMS to provide guidance for states contains procedural rules intended to ensure that individuals are informed about estate recovery before they complete the application process.

There are variations in the ways in which states implement estate recovery, depending upon their Medicaid program and state laws. However, Federal law requires all states to incorporate the following protections for Medicaid recipients into the design of their estate recovery program:

— The State should notify Medicaid recipients about the estate recovery program during their initial application for Medicaid eligibility and annual re-determination process.
— The State must notify affected survivors about the initiation of estate recovery and give them an opportunity to claim an exemption based on hardship.
— The State must establish procedures and criteria to waive recovery if it would cause undue hardship.

The letter went on to say that the final CMS Health Insurance Marketplace application (healthcare.gov) notifies applicants about Medicaid’s right to pursue and recover any money from other health insurance, legal settlements or other third parties but does not disclose estate recovery. Since estate recovery is one of the terms of the Medicaid contract, it is deceptive to omit disclosure of this practice. CMS was asked to provide the reasons for this omission.

CMS responded evasively to the concerned citizen’s question. CMS claimed that the Health Insurance Marketplace application at healthcare.gov does not disclose Medicaid’s right to claim against the estate, because CMS wanted to provide flexibility to state Medicaid agencies as to how each one notifies applicants about estate recovery. Some states have developed pamphlets to address common estate recovery questions or devote a portion of a general Medicaid pamphlet to the subject. Some states also post their state plans, perhaps with additional explanatory text, on their web sites.