Estate Recovery

Any payment of medical assistance by or through DSS to an individual who is an inpatient in a nursing facility, an intermediate care facility for individuals with developmental disabilities, or other medical institution, is a debt due to the department. Any payment on behalf of any person fifty-five years of age or older for nursing facility services, home, and community based services, intermediate care facility services for individuals with intellectual disabilities, hospital, and prescription drug services, is a debt due to the department. DSS shall establish a system of recovery of medical assistance correctly paid by or through the department pursuant to South Dakota Codified Law (SDCL) 28-6-23.

DSS is entitled to receive personal property of a decedent by presenting an affidavit pursuant to South Dakota Codified Law (SDCL) 29A-3-1201 and a statement that the department has incurred an indebtedness by paying nursing facility services, home, and community based services, intermediate care facility services for individuals with intellectual disabilities, hospital, and prescription drug services on behalf of the decedent. If the person paying, delivering, transferring, or issuing personal property or the evidence thereof is aware of any such indebtedness, no payment or delivery may be made, except for payment of funeral expenses, unless payment is first made to DSS or the department has issued satisfaction of indebtedness pursuant to SDCL 29A-3-817.

All real and personal property and other assets included within the individual’s estate as defined in South Dakota Codified Law (SDCL) 29A-3-1201, and any other real and personal property or other assets in which the individual had any legal title or interest at the time of death, including such assets conveyed to a survivor, heir, or assign of the deceased individual through joint tenancy, tenancy in common, survivorship, life estate, living trust, or other arrangement, including any funds remaining in an individual’s prepaid burial trust or prepaid burial account after the individual’s reasonable burial expenses are paid pursuant to South Dakota Administrative Rule (ARSD) 67:48:02:01(2).

The Department is authorized to submit its affidavit 30 days after the death of the recipient. Additional time may be granted when necessary. Family members may request an extension if they need more time to cover funeral expenses pursuant to South Dakota Codified Law (SDCL) 29A-3-1201.

Upon the death of either, or any, of the joint owners of real or personal property in joint tenancy, with right of survivorship, the surviving joint owner or owners shall be liable for the debts and obligation of the deceased joint owner, or owners, under the condition set forth in this chapter pursuant to South Dakota Codified Law (SDCL) 43-46-1.

The recipient and their legal representative are informed of the Estate Recovery Program at the time of application for long‑term care services. When the application is signed, the recipient acknowledges the Estate Recovery Program notice along with all other required program acknowledgments.

No, the department may recover from any estate if the individual was a recipient after July 1, 1994, pursuant to South Dakota Codified Law (SDCL) 28-6-23. Some restrictions do apply to this:

• If using the affidavit process for small estates DSS may only claim on estates less than $100,000 and only claim for nursing facility services, home, and community based services, intermediate care facility services for individuals with intellectual disabilities, hospital, and prescription drug services on behalf of the decedent.
• If submitting a claim on the estate of an individual who was fifty-five years of age or older DSS is restricted to claim only for nursing facility services, home, and community based services, intermediate care facility services for individuals with intellectual disabilities, hospital, and prescription drug services.

In certain situations, a life insurance policy may be subject to estate recovery. If it is a term life policy with no living beneficiary, payment is to the estate and recoverable by Estate Recoveries. If the policy is a whole life policy, the cash value at the time of death of the recipient is recoverable with the remaining payout being distributed to living beneficiaries if there are no living beneficiaries, the whole policy payout is payable to the estate and is recoverable.

DSS may not purse estate recovery if the recipient has a surviving spouse or a surviving child who is under the age of 21, or a child meeting the Supplement Security Income (SSI) definition of blind or disabled. Once this criteria no longer exists, Estate Recovery will be pursued.

If DSS determines that the individual owns or has transferred property or other assets in a manner that would have made the individual ineligible for medical assistance, DSS will pursue recovery of the full amount of benefits paid. In these circumstances, the standard prohibitions on estate recovery do not apply.

Recovery has been expanded to include claims against the estate of a surviving spouse. DSS may file a claim against the estate of the surviving spouse to recover Medicaid benefits previously received by the Medicaid recipient pursuant to South Dakota Administrative Rule (ARSD) 67:48:02:05.

If a surviving spouse wishes to limit the portion of their estate that may be subject to reimbursement for medical assistance expenditures paid on behalf of the Medicaid recipient, the spouse must file a petition for limitation pursuant to South Dakota Codified Law (SDCL) 28-6-23.1. The petition must be completed on a DSS form and submitted to DSS within six months of the Medicaid recipient’s death. All relevant verifications must be included with the petition.

Upon receipt of a petition, DSS will determine the value of the surviving spouse’s estate as of the date of the Medicaid recipient’s death. This determined value will serve as the maximum amount available for recovery of the medical assistance expenditure paid on behalf of the recipient.

For more information contact:

• Address: Department of Social Services,
  Office of Recoveries and Investigations
  700 Governors Drive
  Pierre, SD 57501-2291
• Phone: 605.773.3653
  
• Email: Recoveries@state.sd.us