Estate Recovery

What is TennCare (Medicaid) Estate Recovery?

Estate Recovery is the way TennCare collects money from the estates of people who passed away while receiving TennCare long-term services and supports, such as nursing home care or home and community based services. TennCare, including CHOICES, is paid for by the State and federal governments. If TennCare pays for any of your care, TennCare is required by federal law to try to get paid back for that care after your death. This is called Estate Recovery.

Estate recovery is using the value of things you leave behind when you die to pay TennCare back for care you received while you were living. Your “estate” is made up of the things you own that you leave behind when you die and it includes your money, your home, other property, or other things you own. Estate recovery only applies to people who are receiving long-term services and supports through TennCare CHOICES when they die. TennCare can’t ask for money back until after your death and TennCare can’t ask your family to pay for your care out of their own pockets.

Whose estate is subject to TennCare (Medicaid) Estate Recovery?

TennCare must ask to be repaid for money it spent on your care if you are:

  • Any age and got nursing home care if you weren’t expected to return home
  • Or age 55 and older and got nursing home care, home care, home health or private duty nursing
How do I find out if the estate owes money to TennCare (Medicaid)?

You must complete a Request for Release Form and send it with all requested documentation to TennCare. If no money is owed to the Bureau of TennCare, or if the estate of the deceased TennCare (Medicaid) enrollee is not subject to estate recovery, a release will be provided. If the estate is subject to estate recovery, a TennCare (Medicaid) claim will be filed against the estate of the deceased TennCare (Medicaid) enrollee to let the estate representative/attorney know the amount owed to TennCare (Medicaid) for nursing home services or Home and Community Based Services. The TennCare (Medicaid) claim must then be satisfied to obtain a release.

How do I ask for a release from TennCare?

The person handling your estate after you die may apply for a Release in one of three ways:

  1. Get the Release online at www.tn.gov/tenncare/forms/releaseform.pdf
  2. Get the Release from the Probate Court Clerk’s office by asking for a “Request for Release from Estate Recovery”
  3. Get the Release from TennCare by sending a letter or fax to:
    Bureau of TennCare
    Estate Recovery Unit
    310 Great Circle Road
    Nashville, TN 37243
    FAX: (615) 413-1941
How much will the estate have to pay TennCare?

The TennCare program is based on cost containment through a managed care model. TennCare contracts with Managed Care Organizations (MCOs) which in turn are responsible to ensure the delivery of all covered medical services to TennCare enrollees. TennCare pays MCOs a monthly “capitation” payment prospectively for each enrollee on a per member per month basis. TennCare pays the monthly capitation payment to the MCOs for each month the member is enrolled, regardless of whether the member received a medical service during the month. The MCO contract model in Tennessee is structured as an “at-risk” model. This means that once TennCare pays the per member per month capitation payment for each enrollee to the MCO, the MCO bears the full responsibility of the cost of the enrollee’s healthcare.

The amount of money TennCare will ask to be paid back is based on this “capitation” payment. The average monthly capitation payment to MCOs may exceed $5,000 per month depending on MCO and location. It is important to be aware that capitation payments can exceed the actual costs of services provided during the month.

As a managed care model, TennCare must recover from your estate that portion of the capitation payment that is due to the services listed above, based on the calculation determined by the State.

What are the exemptions from estate recovery?

TennCare may not have to get the money back from your estate if:

  • You leave very little money or property when you die
  • Your care did not cost much
  • The things you left, like life insurance money, can’t be used to pay people you owe through probate court

TennCare must let your money or property stay in the family longer if you leave your money or property to:

  • Your surviving husband or wife
  • Your child who is under age 21 when you die
  • Your child of any age who is blind or permanently and totally disabled

TennCare won’t try to get repaid until this family member dies or the child turns age 21.

TennCare must let just your HOME stay in the family longer if one of these family members lives in the home when you die:

  • Your surviving husband or wife
  • Your child who is under age 21 when you die
  • Your child of any age who is blind or permanently and totally disabled
  • Your child who lived in the home and took care of you if this care kept you out of a nursing home or home care for 2 years
  • Your brother or sister who helped make the house payments if they lived there for a year before you got nursing home or home care

By law, TennCare should not take the house until these family members die or the child turns 21.

TennCare may leave your money and property in the family because of undue hardship.

But the State does not do this very often because the family must prove that losing the money or property in your estate will cause an undue hardship. This means that if your property is a family farm and the family’s only income, then the person handling your things can ask the State not to take the value of the property. The State may or may not agree.

Where do I obtain more information?

Contact: Bureau of TennCare
Estate Recovery Unit
310 Great Circle Road
Nashville, TN 37243
Telephone: 1-866-389-8444
FAX: 615-413-1941

* Estate recovery was enacted by 42 U.S.C. § 1396p, effective October 1, 1993, by T.C.A. § 71-5-116 in 1968, and by the "Old Age Assistance Act" in 1937.