Disclaimer: This article has been posted for general information purposes only. You should not act upon the information in this article without first retaining legal counsel.
By Robert C. Gerhard III, Certified Elder Law Attorney
In recent years, Pennsylvania’s Estate Recovery Program has made significant changes to its policy regarding legal fees and executor commissions in insolvent estates. These changes have had a significant impact on the administration of such estates, leading to increased overall collections and a more efficient process for all parties involved.
A New Approach to Legal Fees and Executor Commissions
Historically, Pennsylvania’s Estate Recovery Program was sometimes known for its stringent policies on legal fees and executor commissions. This reputation discouraged many families and lawyers from taking on the administration of insolvent estates. Relatives of deceased Medicaid recipients often viewed the process as not worth the effort, and attorneys, aware of the challenges and risks associated with insolvent estates, frequently declined these cases due to the likelihood of reduced fees.
However, the program has now adopted a more flexible approach, permitting higher fees and commissions than in the past. This change has incentivized lawyers and family members to administer estates that would have otherwise been abandoned. As a result, more estates are being managed, and overall estate recovery collections have increased. Although excessive fees will continue to be denied, lawyers and family members can now be reasonably compensated for their efforts, making the process more feasible.
The Impact of the Policy Change
The previous policy led to many estates remaining unadministered, with abandoned homes of deceased Medicaid recipients blighting neighborhoods until eventual foreclosure or tax sale. The new policy, while still scrutinizing excessive fees, allows for higher legal fees and executor commissions to be accepted by the Medical Assistance Estate Recovery Program. This has led to a significant increase in the number of insolvent estates being handled, benefiting both the community with fewer abandoned homes and the estate recovery process.
Conclusion
In conclusion, the changes in the Estate Recovery Program’s policy regarding legal fees and executor commissions have had a positive impact on the administration of insolvent estates. By allowing higher fees and commissions, the program has encouraged more families and lawyers to take on these cases, leading to increased overall collections and a more efficient estate recovery process. This policy shift represents a significant step forward in addressing the challenges associated with insolvent estates and ensuring that they are administered properly with the assistance of able legal counsel.
About Gerhard & Gerhard, P.C.
Robert C. Gerhard, III Esquire is the managing shareholder of Gerhard & Gerhard, P.C., an estate planning and elder law firm located in Montgomery County, Pennsylvania. Attorney Gerhard specializes in elder law, with emphasis on Medicaid Planning, Medicaid Applications, and Medicaid Appeals. He is the author of the Pennsylvania law treatise, Pennsylvania Medicaid, Long-term Care. If you would like to schedule an appointment with Attorney Gerhard, please contact us.
