By Robert C. Gerhard, III, Certified Elder Law Attorney
Pennsylvania’s estate recovery claim consists of Medicaid payments made on behalf of the decedent for nursing facility services, home- and community-based services on or after August 15, 1994.
If the assets of the estate are insufficient to pay all proper charges and claims in full, the personal representative has a legal duty under Pennsylvania law pay bills and debts in a certain statutory priority. Secured claims such as mortgages on real estate, and claims to the federal government normally have priority and normally get paid first, but unsecured debts and estate expenses are generally paid in following order under Pennsylvania’s priority statute:
- Estate administration expenses get paid first. This includes filing fees for probate, and payment of reasonable legal fees and the executor’s fee. This is important because it means the executor is allowed to hire a lawyer to make sure things are done properly and be get protection from the personal liability that could occur if the executor were to attempt to handle matters on their own and inadvertently make an improper payment or fail to protect the state’s financial interest in an asset that is subject to estate recovery. Depending on the work performed and complexity of the matter, the executor’s commission can be about the same as the fee paid to the lawyer.
- The family exemption ($3,500).
- The costs of the decedent’s funeral and burial, and the costs of medicines furnished within six months of death, of medical or nursing services performed for the decedent within that time, of hospital services including maintenance provided to the decedent within that time, and of services performed for him by any of the decedent’s employees within that time.
- The cost of a gravemarker.
- Rents for the occupancy of the decedent’s residence for six months immediately prior to his death.
- Claims by the Commonwealth and the political subdivisions of the Commonwealth.
- All other claims, including claims by the Commonwealth.
Click here to contact Gerhard & Gerhard, P.C. for help with your estate administration and estate recovery issues. The direct path to secure answers to your estate recovery questions is to contact our law office for a consultation. The legal fee for the consultation is a permissible estate administration expense, paid ahead of the estate recovery claim under Pennsylvania’s priority statue. For additional details, read our full blog article on the Pennsylvania Medicaid Estate Recovery Program.
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Disclaimer: We recommend that you receive ongoing legal advice from an estate attorney before attempting to administer a trust or an estate. If you wish to secure our services to provide guidance and representation in connection with a trust or estate administration, please contact us.
