MERP in Texas. Any advice?

From Tx Adminsitrative Code
RULE §373.30 Notice of Intent to File A Claim upon Death of Medicaid Recipient
(a) MERP will, within 30 days of the notification of the death of a Medicaid recipient, provide a Notice of Intent to File a Claim, to the following:
(1) Estate representative;
(2) Recipient's guardian of the person, if any; guardian of the estate, if any; or guardian of the person and estate, if any, provided that the name and address of the guardian or guardians are known by MERP;
(3) Recipient's agent under a durable power of attorney if the name and address of the agent are known by MERP;
(4) Recipient's agent under a medical power of attorney if the name and address of the agent are known by MERP; or
(5) If none of the above are known, family members who have acted on behalf of the recipient provided that the name and address of those family members who have acted on behalf of the recipient are known by MERP.

To me, the key in the above is "notification of death". That could come from several sources like TxHHS, TxDADS or triggered by opening probate. It could also be by notification from SSA (they seem to be notified in lighting fast order). I imaging states do this all sorts of ways. There have been posts on this site from family who had a year or couple of years go by before they were made aware of MERP. The clock doesn't start ticking till MERP becomes aware.

Your situation has the whole issue of NO valid will, an intestate. Really you should go and spend the $ to get an estate attorney or probate attorney with experience with MERP to evaluate the situation. If the property has already escheated to the state because she died intestate, you are probably already toast for the proceeds.

Hello, thank you for the very informative post you made. I have a question about MERP. Why is in it in my family's best interest to notify MERP [before probate] about the status of her enrollment in Medicaid ?
Another question I have is this: Isn't the letter of intent sent from MERP when you start the probate process, not immediately after a loved one passes away ?

Sam - as far as coming up with a "strategy" for MERP, it's my opinion that the only one that works 100% in the family or heirs favor is to divest all the elder's assets at least 5 years before they ever apply for Medicaid. Once they apply for Medicaid, the die is cast so to speak for the state to be able to whatever to recover or recoup the costs spend on their care. When they applied for Medicaid, the statement & acknowledgement of MERP is within the application and in any renewals done (at least it was for everything for my mom in TX). It really is dependent on the family, or the heirs to do whatever to be in compliance for Medicaid and in dealing with MERP after death. If you can qualify for the many, many MERP exemptions, exclusions, hardships etc it's up to family to do this; like to keep the records if there are maintenance deductions; or to file for the caregiver exemption; or the low-income exemption; any hardship, etc. The rules on all things MERP is in the Texas Administrative Code & it is on-line & pretty direct as to what's what.

Your response to MERP's letter of intent is when you let MERP know that there are exemptions, exclusions, or hardships. They need to know all this & within short order after the letter goes out because they need to do a cost/benefit analysis to determine if even doing the MERP claim is feasible. But if you don't respond, then it seems that is becomes a claim by default in MERP's favor. If you are sure that nobody got the letter of intent, then send a letter to MERP.

You can write a letter to MERP/HMS to ask what is the status on your mom's estate as far as MERP is concerned. I would send it certified mail.

What you will likely get back is either the letter of intent OR a TX "MERP Authorization & Certification Form" July 2013 edition. For the A&C, you as a heir or probate attorney will need to fill out and fax back to MERP. If its the letter of intent, then you have to get whatever to get any exemptions, exclusions or hardships documented & back to MERP in a short window of time so they can evaluate if the exemptions, etc are valid and adjust or close out the claim. You can't spend months to get this done either, it's like a 30 - 45 day submission for all supporting documentation.

If they send you the A&C form (that you send that back), then what seems to happen is they pull the file on the estate and send you back the very same A&C form with 1 of these checked off:
1. No claim found at this time; or
2. Claim filed in the amount of $$ with the claim document; or
3. that MERP intends to file a claim with the $$ indicated.
IF it's # 2 or # 3, then you have to come to an arrangement with MERP before the property can sell or transfer with clear, good title. The A&C is for MERP claims only. For those with Miller Trusts or annuities there is a whole other 3rd party Recovery Unit in TX too - I have no idea how that works but I'll bet a case of Prosecco those guys are super good at what they do and make HMS/MERP look like cub scouts.

Wills, well for us, my mom's estate attorney held the original. When he retired, it went to his partner. Then he retired so we are now at legal # 3. We got a notification and a sign-off form on this each time - pretty sure this is required by the Bar. Sometimes the attorney or firm puts a notice in the paper that they are closing, so you can go and get your documents. They have to make a fair effort to make the public aware. But you have to do your part. We have a valid copy of will and all her other paperwork but almost always the attorney holds it. Wills are private till they get entered in probate (which is public records) so it would not be on-line. Just a thought, but if dad had a will that was probated, I would contact that law firm to see if they have mom's will. If they are closed, then you track down the old members of the firm to see where they are now and if they have the roll-over files. Contact the local bar too on old firms & their partners. Good luck.

Can one file for waivers or exemptions from MERP before doing any type of probate ? If possible is that hard, expensive, could such a strategy backfire ?
Also is there some type of online repository for wills ? Wills that have not been probated, and from law firms that closed their doors years ago ?

Sam - why I asked about probate is if they die without a will, they are considered to have died "intestate". Under TX law that is problematic because you have to do the lineal affidavit of heirship route if you want to have assets transferred to you. The "open", well I meant that you open probate, this is when you go and present yourself and the letters testamentary so that the court establishes that probate has started, is "open" and you have 4 years from this point in time to complete it. I've been executrix twice and ran 1 out to the full 4 years as lots of complications. Long story, but learned a lot so I'm "experienced" but not an "expert".

But back to MERP, for MERP the intestate can trigger a whole other set of issues. If she died intestate then all property goes to the State under property code 71.001. The is almost a perfect situation for MERP to enforce full claim on the property. If she died intestate and nothing is done to change that, then the state (MERP) gets all. I would speak with an experienced attorney to see what is the likelihood of you all being able to do a successful heirship when MERP has the senior position in all this. It would be such a PIA to go the time & $$ to get an attorney only to find that at the end that all proceeds from the sale of the home have to go to MERP as that is the only way the claim can be lifted to actually go to act of sale.

For more fun in all this, the MERP claim is not a lien on the property. So it will not be easily findable by going through the property records filings at the courthouse like a workman's lien would be. What happens is that when you go to transfer the property, the MERP claim surfaces when they go to do the title search. Until the claim is lifted, the buyer cannot get a clean, clear title. At this point, you end up having to do an MERP authorization form in which MERP gets the proceeds and you sign off for it to happen - has to be done for the sale to go through. If you want to read more on this, there is pretty great article in the Summer 2009 edition of TRGC Stargazer newsletter. They are the nexus for the title companies in TX.
Let us know what happens too, as we all learn from each other.Good luck

If it is a small estate under $50,000 (not including her residence) no probate necessary here in Texas. All you need is certified death certificate, your identification to do whatever is needed. If there were insurance policies the death certificate is mailed, current address for beneficiaries and proceeds distributed as written on the policy.

We closed my aunt's bank accounts, sold car and house this way all with the advice of her attorney. Why she didn't have a Will we will never know. Her attorney of 30 years could never get her to sign a legal document. She visited him for advice and kept notes of their conversations in a journal. Go figure!

As far as I understand, no proceedings on probate.Is open the same thing as going through with probate ? As my brothers have stated to me the only option is a dependent adminstrator. We have too many creditors for affidavit of heirship and I doubt we can find 2 or 3 witnesses that knew my parents.
If there were some type of proceedings done on probate for my mom, is that searchable online somewhere ?
Thanks
Sam

….hmmm, no will for mom? that totally changes things. You need a will in order to enter probate, I'm pretty sure. Are you sure no will? So was probate opened?

Wow awesome advice, and thank you. If I may I would to describe my perculiar situation. And believe me this is strange or I think it is. My parents had 3 children.
I have two older brothers. I am the youngest. My father passed away 8 years ago. His will was probated. My mom died Dec of 2012. She was in a nursing home and was recieving Medicaid. I had the medical power of attorney for. When she passed away the lawyer that assisted in preparing for the Medicaid applcation said that we should be getting a letter from MERP, and after 30 days you are probably okay But her lawyer assistant said no you better wait a year. Hmm okay.
So me and my 2 brothers agree. A year goes by and still no notice or letter from HMS or MERP.. So now, 18 months after my mom has passed away, still no notice or letter. And I have learned that MERP is formaly notified by the probate court, when you go through probate, and that is when they send a letter or notice.
At least I think it is that way in MONT. Co TX.
Now I have no idea if they did indeed have sent a letter. My brothers claim they never saw one. So what do you think ? Is there a serious problem going here or what could I do on my own without hiring an attorney ?
Unfortunately there is a lot more to this story. I have come to find out that there is no will for my mom, even I know thre is one. And my brothers are demanding that we do a dependent administrator. I do not think I like that.
I apologize for my spelling.

Thanks

Sam

TX - like other states - has outsourced MERP.
The Texas Health and Human Services Commission, the Medicaid agency in TX, has ultimate responsibility for “MERP”. However, many of the administrative functions have been delegated to the Department of Aging and Disability Services, and the actual collections are handled by a contractor called Health Management Services, Inc (“HMS”). Thus, HMS is often the primary point of contact that the decedent’s heirs have with the MERP.

It is HMS that send the "intent to file" letter on state letterhead. HMS is very, very good at what they do at this point in time. Be aware that the process is very much on strict timetable for compliance by family. However, you need to be sure that if you are the family member who is going to be doing all things MERP, that you are on file with TxHHS & TxDADS as the contact person or family representative for the elder so that the intent letter comes to you. You don't want it going to the old NH address or to family who will ignore the letter. Letter will have the details within it and the timeframe required for you to do any exemptions, exclusions or hardships to reduce or cancel the MERP claim. Those are listed in the TxDADs site link that Carol wrote about.

If you know you will be filing exemptions, etc., really you should start getting all the documentation together to prove your exemption. So if you are filing for low-income heir, you need to have tax stuff or other items that show that qualification; if they still have their home and you are doing exclusions for home costs, you need to provide in detail any items that you paid for the empty house (like taxes, insurance, maintenance) in order to have those deducted from the tally, etc. IF you are doing caregiver exemption, you may have to get a doctors care letter and provide documentation that you were a full-time caregiver for 2 years prior. You have about 45 days to get all this in. What you don't want to have happen is that after their death, you have other things to tend to; or find yourself emotionally unable to deal with things and the MERP items get overlooked. The time table on all this is very strict, so whatever you can do now to be prepared is a good idea. Good luck.

This is the link to the most frequently asked questions for MERP in Texas.
http://www.dads.state.tx.us/services/estate_recovery/faqs.html

You can also go to the Texas Department of Aging and Disability.
Best of luck,
Carol