While many people focus on creating a Last Will and Testament or revocable living trust when they think about estate planning, they often overlook the financial impact that a lengthy stay in a nursing home or other long-term care facility can have on their estate. The high cost of long-term care causes many seniors to turn to Medicaid for help. Qualifying for Medicaid, however, does not necessarily mean your assets are permanently protected. Federal law requires every state to operate a Medicaid Estate Recovery Program (MERP), allowing the state to seek reimbursement for certain Medicaid benefits paid during your lifetime. Understanding how New Hampshire’s Medicaid Estate Recovery Program operates is an important step toward protecting your estate, preserving assets for your loved ones, and incorporating Medicaid planning into your overall estate plan. Toward that end, the attorneys at Legacy Care Law Firm explain what you need to know about the New Hampshire Medicaid Estate Recovery Program (MERP).
Why Long-Term Care Planning Matters
Many people assume that Medicare will cover all their healthcare expenses throughout retirement. While Medicare provides valuable health insurance benefits, it generally does not pay for extended custodial care in a nursing home or other long-term care setting. As a result, individuals who require assistance with activities such as bathing, dressing, eating, mobility, or medication management often discover that they must find another source of payment. Moreover, the probability of needing some form of long-term care during retirement is significant, and the cost of that care continues to rise. In New Hampshire, annual nursing home expenses average more than $150,000 (as of 2026), making it difficult for many families to privately pay for care over an extended period. Even assisted living facilities and in-home care services may consume retirement savings much faster than anticipated. For many older adults, Medicaid eventually becomes the only realistic option for paying these expenses.
Medicaid Eligibility Is Only Part of the Picture
Qualifying for Medicaid requires more than demonstrating a medical need for long-term care. The program also imposes strict financial eligibility requirements based on income and countable resources. Certain assets are considered exempt when determining eligibility, while others must be reduced or “spent down” before benefits become available. For many applicants, the family residence is among the assets that may qualify as exempt during the eligibility determination process, provided applicable requirements are satisfied. This often creates the mistaken impression that the home is permanently protected from Medicaid.
It is crucial to understand that an asset that is exempt for purposes of Medicaid eligibility may still become subject to estate recovery after the Medicaid recipient dies. Consequently, qualifying for Medicaid should not be viewed as the final step in protecting your estate. Instead, eligibility planning and estate recovery planning should be considered together as part of a comprehensive Medicaid strategy.
What Is the Medicaid Estate Recovery Program?
The Medicaid Estate Recovery Program is a federally mandated program requiring states to seek reimbursement for certain Medicaid benefits paid on behalf of deceased recipients. Because Medicaid is a needs-based public assistance program funded by taxpayers, federal law permits states to recover some of the money spent providing benefits after a recipient dies. Recovery generally occurs through claims against the deceased recipient’s estate rather than through collection efforts during the recipient’s lifetime.
In New Hampshire, the Medicaid Estate Recovery Program is administered by the Department of Health and Human Services Estate Recovery Unit. After the death of a Medicaid recipient, the Estate Recovery Unit evaluates whether reimbursement may be sought for benefits paid under qualifying public assistance programs. Depending on the circumstances, the state may file claims against property included within the recoverable estate before assets are distributed to heirs or beneficiaries.
New Hampshire Uses an Expanded Definition of Recoverable Property
One feature that distinguishes New Hampshire from some other states is the broad scope of property that may be subject to estate recovery. Many states limit recovery to assets that pass through probate, meaning that property transferred outside of probate through beneficiary designations, joint ownership, or certain trusts may not be available to satisfy Medicaid recovery claims.
New Hampshire, however, takes a different approach by applying an expanded definition of recoverable property for purposes of the Medicaid Estate Recovery Program. Depending on the circumstances, recovery may extend beyond traditional probate assets and include additional forms of property ownership recognized under state law.
This broader recovery authority makes Medicaid planning particularly important because strategies that successfully avoid probate do not necessarily prevent Medicaid estate recovery in New Hampshire. Simply transferring property outside of your probate estate may not achieve the protection many people expect.
What Types of Property May Be Subject to Estate Recovery?
People frequently establish revocable living trusts believing that avoiding probate automatically shields assets from every post-death claim. While trusts remain valuable estate planning tools for many reasons, avoiding probate alone does not necessarily eliminate the possibility of Medicaid estate recovery under New Hampshire law. The exact assets subject to recovery depend upon how property is owned and on the applicable New Hampshire laws, but may include:
- Assets passing through your probate estate.
- Property owned as a joint tenant.
- Property owned as a tenant in common.
- Certain life estate interests.
- Certain property transferred to or held in a living trust established on or after July 1, 2005.
When Estate Recovery Is Delayed or Prohibited
Although the Estate Recovery Unit possesses broad authority to seek reimbursement, that authority is not unlimited. Both federal and state law recognize circumstances in which immediate recovery would create undue hardship or interfere with important family protections For example, New Hampshire generally does not pursue recovery against the estate of a surviving spouse while that spouse remains alive. Likewise, the state may not enforce recovery in a manner that would displace certain protected family members residing in the Medicaid recipient’s home, such as:
- A surviving spouse.
- A child under the age of 21.
- A child of any age who is blind or disabled.
- A sibling who has an ownership interest in the home and who satisfies applicable residency requirements established by law.
These exceptions illustrate that Medicaid estate recovery is not automatic in every case. Instead, recovery depends upon the specific facts surrounding the recipient’s estate, the type of property involved, and whether statutory protections apply. Families should not assume that recovery will occur in every situation, nor should they assume their estate is automatically exempt without carefully evaluating the applicable law.
Do You Have Questions about Medicaid Estate Recovery in New Hampshire?
For more information, please join us for an upcoming FREE seminar. If you have questions or concerns about the Medicaid Estate Recovery Program in New Hampshire or about how to title your property, contact our Medicaid planning attorneys in our North Andover, Woburn, and Beverly offices at (978) 969-0331. Our Salem and Nashua, New Hampshire office can be reached at (603) 894-4141.
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