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S1318................................................by JUDICIARY AND RULES
ESTATES - MEDICAL ASSISTANCE COSTS - Amends existing law relating to estate
property to set forth provisions applicable to the recovery of medical
assistance costs by the Department of Health and Welfare; and to revise
provisions applicable to the recovery of certain medical assistance.
01/30 Senate intro - 1st rdg - to printing
01/31 Rpt prt - to Jud
02/09 Rpt out - rec d/p - to 2nd rdg
02/10 2nd rdg - to 3rd rdg
02/14 3rd rdg - PASSED - 35-0-0
AYES -- Andreason, Brandt, Broadsword, Bunderson, Burkett,
Burtenshaw, Cameron, Coiner, Compton, Corder, Darrington, Davis,
Fulcher, Gannon, Geddes, Goedde, Hill, Jorgenson, Kelly, Keough,
Langhorst, Little, Lodge, Malepeai, Marley, McGee, McKenzie, Pearce,
Richardson, Schroeder, Stegner, Stennett, Sweet, Werk, Williams
NAYS -- None
Absent and excused -- None
Floor Sponsor - Kelly
Title apvd - to House
02/15 House intro - 1st rdg - to Jud
03/06 Rpt out - rec d/p - to 2nd rdg
03/07 2nd rdg - to 3rd rdg
03/16 3rd rdg - PASSED - 64-0-6
AYES -- Anderson, Andrus, Barraclough, Barrett, Bastian, Bayer, Bell,
Bilbao, Black, Block, Boe, Bolz, Brackett, Bradford, Cannon,
Chadderdon, Clark, Collins, Deal, Denney, Edmunson, Ellsworth,
Eskridge, Field(18), Field(23), Garrett, Hart, Harwood, Henbest,
Henderson, Jaquet, Kemp, Lake, LeFavour, Loertscher, Martinez,
Mathews, McGeachin, McKague, Miller, Mitchell, Moyle, Nielsen,
Nonini, Pasley-Stuart, Pence, Raybould, Ring, Ringo, Roberts, Rusche,
Rydalch, Sali, Sayler, Schaefer, Shepherd(2), Shepherd(8), Shirley,
Skippen, Smith(30), Smith(24), Smylie, Stevenson, Trail
NAYS -- None
Absent and excused -- Bedke, Crow, Snodgrass, Wills, Wood, Mr.
Speaker
Floor Sponsor - Smith(24)
Title apvd - to Senate
03/17 To enrol
03/20 Rpt enrol - Pres signed - Sp signed
03/21 To Governor
03/24 Governor signed
Session Law Chapter 179
Effective: 07/01/06
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature Second Regular Session - 2006
IN THE SENATE
SENATE BILL NO. 1318
BY JUDICIARY AND RULES COMMITTEE
1 AN ACT
2 RELATING TO ESTATE PROPERTY; AMENDING SECTION 15-3-1201, IDAHO CODE, TO SET
3 FORTH PROVISIONS APPLICABLE TO THE RECOVERY OF MEDICAL ASSISTANCE COSTS BY
4 THE DEPARTMENT OF HEALTH AND WELFARE AND TO MAKE TECHNICAL CORRECTIONS;
5 AMENDING SECTION 56-218, IDAHO CODE, TO REVISE PROVISIONS APPLICABLE TO
6 THE RECOVERY OF CERTAIN MEDICAL ASSISTANCE; AND AMENDING SECTION 56-218A,
7 IDAHO CODE, TO REVISE A CODE REFERENCE.
8 Be It Enacted by the Legislature of the State of Idaho:
9 SECTION 1. That Section 15-3-1201, Idaho Code, be, and the same is hereby
10 amended to read as follows:
11 15-3-1201. COLLECTION OF PERSONAL PROPERTY BY AFFIDAVIT. (a) Thirty (30)
12 days after the death of a decedent, any person indebted to the decedent or
13 having possession of tangible personal property or an instrument evidencing a
14 debt, obligation, stock or chose in action belonging to the decedent shall
15 make payment of the indebtedness or deliver the tangible personal property or
16 an instrument evidencing a debt, obligation, stock or chose in action to a
17 person or entity claiming to be the successor of the decedent upon being pre-
18 sented an affidavit made by or on behalf of the successor stating that:
19 (1) tThe fair market value of the entire estate of the decedent which is
20 subject to probate, wherever located, less liens and encumbrances, does
21 not exceed seventy-five thousand dollars ($75,000);
22 (2) tThirty (30) days have elapsed since the death of the decedent;
23 (3) nNo application or petition for the appointment of a personal repre-
24 sentative or for summary administration is pending or has been granted in
25 any jurisdiction; and
26 (4) tThe claiming successor is entitled to payment or delivery of the
27 property, including entitlement as a trust pursuant to a will of the dece-
28 dent.
29 (b) A transfer agent of any security shall change the registered owner-
30 ship on the books of a corporation from the decedent to the successor or suc-
31 cessors upon the presentation of an affidavit as provided in subsection (a) of
32 this section.
33 (c) For the purposes of this section, for the recovery of medical assis-
34 tance, the department of health and welfare shall be deemed a successor to the
35 estate provided:
36 (1) Prior to the presentation of the affidavit, the department shall give
37 notice, by regular mail, to any person known to the department to be an
38 heir, successor or creditor of the estate, and the department shall cer-
39 tify such notice in writing to the person described in subsection (a) of
40 this section.
41 (2) Within sixty (60) days of mailing the notice, any person who claims
42 the right to reimbursement for priority estate expenses, as permitted by
43 section 15-3-805(a)(1) through (4), Idaho Code, may submit a written
2
1 demand for payment of such expenses, together with any documentation of
2 the expenses, to the department. Upon receipt of the funds, and up to the
3 amount received, the department shall pay priority claims which it deter-
4 mines would be allowed in a probate proceeding, if any. The department
5 shall notify each claimant of the disposition of his claim. The provisions
6 of chapter 52, title 67, Idaho Code, shall apply to determinations made by
7 the department under this section.
8 SECTION 2. That Section 56-218, Idaho Code, be, and the same is hereby
9 amended to read as follows:
10 56-218. RECOVERY OF CERTAIN MEDICAL ASSISTANCE. (1) Except where exempted
11 or waived in accordance with federal law medical assistance pursuant to this
12 chapter paid on behalf of an individual who was fifty-five (55) years of age
13 or older when the individual received such assistance may be recovered from
14 the individual's estate, and the estate of the spouse, if any, for such aid
15 paid to either or both; provided, however, that claim for such medical assis-
16 tance correctly paid to the individual may be established against the estate
17 of either spouse, but:
18 (a) Tthere shall be no adjustment or recovery thereof until after the
19 death of both the individual and the spouse, if any, and only at a time
20 when the individual has no surviving child who is under twenty-one (21)
21 years of age or is blind or permanently and totally disabled as defined in
22 42 U.S.C. 1382c.
23 (b) While one (1) spouse survives, except where joint probate will be
24 authorized pursuant to section 15-3-111, Idaho Code, a claim for recovery
25 under this section may be established in the estate of the deceased
26 spouse.
27 (c) The claim against the estate of the first deceased spouse must be
28 made within the time provided by section 15-3-801(b), Idaho Code, if the
29 estate is administered and actual notice is given to the director as
30 required by subsection (5) of this section. However, if there is no admin-
31 istration of the estate of the first deceased spouse, or if no actual
32 notice is given to the director as required by subsection (5) of this sec-
33 tion, no claim shall be required until the time provided for creditor
34 claims in the estate of the survivor.
35 (d) Nothing in this section authorizes the recovery of the amount of any
36 aid from the estate or surviving spouse of a recipient to the extent that
37 the need for aid resulted from a crime committed against the recipient.
38 (2) Transfers of real or personal property, on or after the look-back
39 dates defined in 42 U.S.C. 1396p, by recipients of such aid, or their spouses,
40 without adequate consideration are voidable and may be set aside by an action
41 in the district court.
42 (23) Except where there is a surviving spouse, or a surviving child who
43 is under twenty-one (21) years of age or is blind or permanently and totally
44 disabled as defined in 42 U.S.C. 1382c, the amount of any medical assistance
45 paid under this chapter on behalf of an individual who was fifty-five (55)
46 years of age or older when the individual received such assistance is a claim
47 against the estate in any guardianship or conservatorship proceedings and may
48 be paid from the estate.
49 (3) Nothing in this section authorizes the recovery of the amount of any
50 aid from the estate or surviving spouse of a recipient to the extent that the
51 need for aid resulted from a crime committed against the recipient.
52 (4) For purposes of this section, the term "estate" shall include:
53 (a) All real and personal property and other assets included within
3
1 the individual's estate, as defined for purposes of state probate
2 law; and
3 (b) Any other real and personal property and other assets in which
4 the individual had any legal title or interest at the time of death
5 (to the extent of such interest), including such assets conveyed to a
6 survivor, heir, or assign of the deceased individual through joint
7 tenancy, tenancy in common, survivorship, life estate, living trust
8 or other arrangement.
9 (5) Claims made pursuant to this section shall be classified and paid as
10 a debt with preference as defined in section 15-3-805(5), Idaho Code. Any dis-
11 tribution or transfer of the estate prior to satisfying such claim is voidable
12 and may be set aside by an action in the district court. The personal repre-
13 sentative of every estate subject to a claim under this section must, within
14 thirty (30) days of the appointment, give notice in writing to the director of
15 his or her appointment to administer the estate. However, if an exempt prop-
16 erty allowance claim is made in an estate subject to a claim under this sec-
17 tion by one (1) or more persons not described in subsection (2) of this sec-
18 tion, then, to the extent such exempt property allowance claim exceeds the
19 fair market value of the actual personal property of the decedent held by the
20 estate subject to a claim under this section (including, but not limited to,
21 such items as household furniture, automobiles, furnishings, appliances, and
22 personal effects), the persons making such exempt property allowance claim
23 must file with the court, and with the personal representative or administra-
24 tor of the estate, and with the department, a written statement under oath
25 containing the following:
26 (a) A statement that no personal property of the decedent has been trans-
27 ferred without adequate consideration to any person or entity, including
28 any one (1) or more of the persons making the exempt property allowance
29 claim, to the actual knowledge of any of the persons making the exempt
30 property allowance claim, within a time period commencing one (1) year
31 prior to the death of the decedent and ending on the date of the state-
32 ment; or
33 (b) A statement that personal property of the decedent has been trans-
34 ferred without adequate consideration to any person or entity, including
35 one (1) or more of the persons making the exempt property allowance claim,
36 within a time period commencing one (1) year prior to the death of the
37 decedent and ending on the date of the statement, to the actual knowledge
38 of any of the persons making the exempt property allowance claim, and
39 stating the fair market value of the personal property so transferred, and
40 stating a reasonable description of such property, and stating the method
41 of determining the fair market value of the personal property so trans-
42 ferred.
43 If the written statement indicates that there has been such a transfer of per-
44 sonal property, then the fair market value of the personal property so trans-
45 ferred shall be subtracted from the remaining exempt property allowance claim,
46 after subtraction of the personal property held by the estate, as described
47 above, and only any still remaining portion of the exempt property claim may
48 be paid by the estate to the persons making the exempt property allowance
49 claim. The statement submitted under paragraph (a) or (b) of this subsection,
50 must be signed under oath by all persons making the exempt property claim.
51 (6) The department may file a notice of lien against the property of any
52 estate subject to a claim under this section.
53 (a) In order to perfect a lien against real or personal property, the
54 department shall, within ninety (90) days after the personal representa-
55 tive or successor makes a written request for prompt action to the direc-
4
1 tor, or three (3) years from the death of the individual for whom medical
2 assistance was paid under this chapter decedent, whichever is sooner, file
3 a notice of lien in the same general form and manner as provided in sec-
4 tion 56-218A(3)(a), Idaho Code, in the office of the secretary of state,
5 pursuant to section 45-1904, Idaho Code. Failure to file a notice of lien
6 does not affect the validity of claims made pursuant to this section.
7 (b) The department may release the lien in whole or in part to permit the
8 estate property to be administered by a court-appointed personal represen-
9 tative.
10 (c) The department may foreclose its lien, without probate, in any of the
11 following circumstances:
12 (i) Where no personal representative has been appointed after one
13 (1) year from the date of death of the survivor of both the individ-
14 ual and spouse, if any;
15 (ii) Where the property has been abandoned by the decedent's heirs
16 or successors, if any;
17 (iii) Where the real property taxes that are due and payable have
18 remained unpaid for two (2) years and, after demand by the depart-
19 ment, the heirs or successors, if any, have failed to seek appoint-
20 ment or pay the property taxes; or
21 (iv) Where all parties interested in the estate consent to foreclo-
22 sure of the lien.
23 (7) The director shall promulgate rules reasonably necessary to implement
24 this section including, but not limited to, rules establishing undue hardship
25 waivers for the following circumstances:
26 (a) The only asset of the estate subject to recovery is income-producing
27 property that provides the primary source of support for other family mem-
28 bers; or
29 (b) The estate has a value below an amount specified in the rules; or
30 (c) Recovery under the lien by the department will entitle cause the
31 heirs of the deceased individual to be eligible for public assistance.
32 (8) The cause of action to void a transfer without adequate consideration
33 established in this section shall not be deemed to have accrued until the
34 department discovers, or reasonably could have discovered, the facts consti-
35 tuting the transfer without adequate consideration.
36 SECTION 3. That Section 56-218A, Idaho Code, be, and the same is hereby
37 amended to read as follows:
38 56-218A. MEDICAL ASSISTANCE LIENS DURING LIFE OF RECIPIENT. (1) The
39 department may recover and may impose a lien against the real property of any
40 individual prior to his death for medical assistance paid or about to be paid
41 under this chapter on behalf of an individual:
42 (a) Who is an inpatient in a nursing facility, intermediate care facility
43 for the mentally retarded, or other medical institution, if such individ-
44 ual is required, as a condition of receiving services in such institution
45 under the state plan, to spend for costs of medical care all but a minimal
46 amount of his income required for personal needs; and
47 (b) With respect to whom the department has determined, after notice and
48 opportunity for hearing, that he cannot reasonably be expected to be dis-
49 charged from the medical institution and to return home.
50 (2) No lien may be imposed on the home of an individual under subsection
51 (1) of this section if any of the following is lawfully residing in such home:
52 (a) The spouse of such individual;
53 (b) Such individual's child under age twenty-one (21) years;
5
1 (c) Such individual's child who is blind or permanently and totally dis-
2 abled as defined in 42 U.S.C. 1382c; or
3 (d) A sibling of such individual who holds an equity interest in such
4 home and who was residing in such home for a period of at least one (1)
5 year prior to the individual's admission to the medical institution.
6 (3) (a) The lien shall be perfected by filing in the office of the secre-
7 tary of state a notice of lien pursuant to section 45-1904, Idaho Code.
8 The notice of lien shall include, in addition to the information required
9 by section 45-1904, Idaho Code, the amount paid or about to be paid by the
10 department on behalf of the individual, and, if applicable, the fact that
11 the amount of the lien may increase over time.
12 (b) The department shall file any notice of lien under this section
13 within ninety (90) days of the final determination of the department,
14 after hearing if any, required in subsection (1)(b) of this section, with
15 the exception of property against which the department is prevented from
16 filing a lien pursuant to subsection (2) of this section. With respect to
17 the property described in subsection (2) of this section, the department
18 shall file a notice of lien within ninety (90) days after the department
19 is notified in writing that subsection (2) of this section ceases to apply
20 to the property.
21 (4) Any lien imposed in accordance with subsection (1) of this section
22 shall dissolve upon the individual's discharge from the medical institution
23 and return home.
24 (5) No recovery shall be made under this section for medical assistance
25 correctly paid except from such individual's estate as defined in subsection
26 (4) of section 56-218, Idaho Code, and subject to subsections (31)(d), (5) and
27 (6) of section 56-218, Idaho Code, or upon sale of the property subject to a
28 lien and may be made only after the death of such individual's surviving
29 spouse, if any, and only at a time:
30 (a) When he has no surviving child who is under age twenty-one (21)
31 years, or who is blind or permanently and totally disabled as defined in
32 42 U.S.C. 1382c; or
33 (b) In the case of a lien on an individual's home under subsection (1) of
34 this section, when none of the following is lawfully residing in such home
35 who has lawfully resided in such home on a continuous basis since the date
36 of the individual's admission to the medical institution:
37 (i) A sibling of the individual, who was residing in the
38 individual's home for a period of at least one (1) year immediately
39 before the date of the individual's admission to the medical institu-
40 tion; or
41 (ii) A son or daughter of the individual, who was residing in the
42 individual's home for a period of at least two (2) years immediately
43 before the date of the individual's admission to the medical institu-
44 tion and who establishes to the satisfaction of the state that he or
45 she provided care to such individual which permitted such individual
46 to reside at home rather than in an institution.
47 (6) The director shall promulgate rules reasonably necessary to implement
48 this section including, but not limited to, rules establishing undue hardship
49 waivers, as provided in section 56-218(7), Idaho Code, and a procedure for
50 notice and opportunity for hearing on the department's determination that an
51 individual cannot reasonably be expected to be discharged from a medical
52 institution and to return home.
STATEMENT OF PURPOSE
RS 15741
This bill clarifies how the Medicaid Estate Recovery division of
Health & Welfare can recover assets from the estate of a decedent
and clears up a number of uncertain areas of law.
Section One covers the Small Estate Affidavit, which allows a
"successor" of the decedent to obtain personal property assets
held by third parties (bank accounts, stocks, etc.) by use of an
affidavit, within the limits set forth in the statute. This bill
allows the Department of Health & Welfare to be a successor if:
1. The Department has a claim for estate recovery against
the decedent;
2. the Department gives notice, by regular mail, to any
person known to the department to be an heir, successor, or
creditor of the estate, and the department certifies that
notice in writing to the person described in paragraph (a)
of the section, the normal successor; and,
3. The Department reimburses all priority claims under the
probate code which are presented within sixty days after the
notice.
Use of this procedure is far less expensive than filing a full
probate proceeding.
Section Two amends Idaho Code 56-218 to clarify the presentation
and collection of estate recovery claims by Health & Welfare. A
number of clarifications are made by repositioning language or
stating the existing concept more clearly. Under existing law,
if the institutionalized spouse, who received Medicaid, dies
leaving a surviving spouse, no actual collection is made, but a
"claim" must be sent to the personal representative of the estate
of deceased institutionalized spouse, or if no probate is done,
to the surviving spouse. This can be very frightening to the
surviving spouse, who often does not understand that no current
reimbursement is being demanded. Therefor, the bill both
clarifies that no recovery is made until both spouses are
deceased and also removes the requirement to send a claim if no
probate is filed at the first death.
The bill also clarifies how the lien filed by the Department with
the Secretary of State may be released, in order to allow sale of
the property by the estate, or foreclosed, to expedite estate
recovery when the real estate has been abandoned or has real
property taxes overdue which may be foreclosed upon or where no
probate has been filed and all heirs agree to the procedure as an
alternative to probate.
Section Three only corrects a cross-reference.
FISCAL NOTE
This bill will have no fiscal impact, except that it may reduce
the costs of estate recovery to the Department of Health &
Welfare.
Contact
Name: Robert L. Aldridge, Trust & Estate Professionals of Idaho, Inc.
Phone: 208-336-9880
Cell: 208-631-2481
STATEMENT OF PURPOSE/FISCAL NOTE S 1318