Detailed Answer
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult an attorney for advice tailored to your situation.
Under federal law (42 U.S.C. §1396p(b)) and Wisconsin law (Wis. Stat. § 49.146), the Department of Health Services (DHS) must seek recovery from the estates of certain Medicaid recipients who were age 55 or older or permanently institutionalized when they received long-term care benefits. Recovery may include placing a claim on inherited real property. However, recipients or their heirs can apply for a hardship waiver or deferral to protect inherited property when estate recovery would cause undue hardship.
Key steps to apply for a hardship waiver or deferral in Wisconsin:
- Review the estate recovery notice. After the recipient’s death, DHS sends a written notice outlining the amount owed and property subject to recovery.
- Determine eligibility for a waiver or deferral. DHS may grant relief if recovery would:
- Deprive a surviving spouse, minor child, or blind/disabled child of the home.
- Create undue financial hardship for heirs.
- Interfere with protected life estates or rights of possession.
- Complete the hardship waiver/deferral request. Use DHS Form 1060 (Estate Recovery Hardship Waiver/Deferral Request) or submit a detailed written request within 30 days of the notice. Include:
- Description of the hardship (e.g., household budget, health needs).
- Documentation of income, expenses, and family composition.
- Proof of relationship (e.g., birth certificates, marriage certificate).
- Submit supporting documentation. Attach bank statements, tax returns, mortgage or rent statements, and medical bills to demonstrate undue hardship.
- Submit the request on time. Mail or email the completed form and documents to the address on the notice. Late submissions may be denied.
- Await DHS decision. DHS must issue a decision within 90 days. If approved, DHS will record a waiver or deferral agreement. If denied, you have the right to request a fair hearing under Wis. Admin. Code ch. DHS HA.
For more information, see the DHS Medicaid Estate Recovery page: dhs.wisconsin.gov/medicaid/estate-recovery.htm and the statute at Wis. Stat. § 49.146.
Helpful Hints
- Gather all financial documents before starting your application.
- Keep copies of every form and piece of evidence submitted.
- Write a clear, concise hardship narrative explaining why recovery would be devastating.
- Follow up with DHS in writing if you do not receive a decision within 90 days.
- Consider consulting legal aid or a qualified attorney if the request is complex or denied.