Medicaid

Oregon v. Willingham, 136 P.3d 66 (Ore. App. 2006)

When contrasted with Hines and Smith, a different result was reached where the legislature had re-written the property code. In 1993, Jack Willingham transferred certain real property to his son, reserving a life estate. In 1997, he applied for medical assistance from the state, which he received until his death in 2002. There, a 1995 statute arguably abrogated the common law rule that a life estate is extinguished at the death of the life tenant. The Department asserted a claim against the remainderman for the value of the life estate. The Court found that “[f]or purposes of the recovery of medical assistance paid by the state during the lifetime of the holder of a life estate interest, the life estate continues to exist after the death of the person holding the interest.” The question remaining for consideration in the trial court was whether the law could be retroactively applied in Willingham; future transactions, however, appear to be subject to the new statutory rule.

Note: The law on estate recovery continues to develop as states become more aggressive in recovery litigation. The law is different in each state, depending on whether recovery is limited to the probate estate or an expanded estate. Other estate recovery cases with varied results include In re Estate of Smith, 2006 Tenn. App. LEXIS 715 (Tenn. Ct. App. 2006); In re Estate of Barg, 722 N.W.2d 492 (Minn. Ct. App. 2006); In re Estate of Nistler, 2006 Minn. App. Unpub. LEXIS 1053 (Minn. Ct. App. Unpub. 2006); Dep’t of Human Servs. v. Laughead (In re Estate of Laughead), 696 N.W.2d 312 (Iowa 2005); Estate of DeMartino v. Div. of Med. Assistance & Health Servs., 373 N.J. Super. 210 (App. Div. 2004); State Dep’t of Human Res. v. Estate of Ullmer, 87 P.3d 1045 (Nev. 2004); In re Estate of Jobe, 590 N.W.2d 162 (Minn. Ct. App. 1999); Idaho Dep’t of Health & Welfare v. Jackman (in Re Estate of Knudson), 132 Idaho 213 (Idaho 1998).