Are Death Settlements Subject to Medicaid Liens?

Serving Clients Throughout Woodbridge Virginia

Can Medicaid take a settlement from family members of a deceased 28-year-old in New Jersey who was quadriplegic and in a nursing home for a portion of his disabled years?
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Are Death Settlements Subject to Medicaid Liens?

There are two types of claims for death caused by a third party due to negligence or other wrongful conduct, says nj.com’s recent article entitled “Can Medicaid take money from a death settlement?”

Negligence is a failure to take reasonable care to avoid causing injury or loss to another person. This action or inaction of the person or organization in the circumstances failed to meet the standard of care, which a reasonable person would meet in the circumstances (also known as breach of duty).

A survival action is brought to recover damages to the deceased person. This type of claim allows the estate of the decedent to be awarded damages the deceased incurred from the moment of the injury until the time of death.

The other type of claim is a wrongful death action that is brought to recover damages for the survivors of the deceased person.

A wrongful death suit asks that the estate to be awarded damages for the beneficiaries of the deceased.

Wrongful death lawsuits are governed by state law, so each state has its own specific deadlines and procedures. However, there are a few issues common to all states’ wrongful death laws, including:

  • Who can file a wrongful death lawsuit on behalf of the deceased’s estate
  • How a person gets appointed to represent the estate; and
  • The kinds of damages allowed in a wrongful death case.

Wrongful death settlements aren’t subject to a Medicaid lien because the injured parties are the survivors.

However, settlements of survival actions are subject to Medicaid liens because the injured party is the deceased person.

If you have questions about these types of claims, you should talk to an experienced attorney to look at the issue based on the specific facts of your case.

Reference: nj.com (April 23, 2021) “Can Medicaid take money from a death settlement?”