Estate Recovery:
7108.3.2 Hardship Exemptions for Homesteads
At any time before closure of the probate estate, an heir may assert that adjustment or recovery against the homestead would be an undue hardship and that the homestead should be exempt from adjustment or recovery for the costs of Medicaid long-term care services. The department shall exempt a home from estate recovery based undue hardship when one or more of the following three conditions have been established to department’s satisfaction.
A. A sibling has been living in the home continuously for at least one year immediately before the date the decedent began receiving long-term care services. (An Affidavit is required)
B. A son or daughter has been living in the home continuously for at least two years immediately prior to the date the decedent receiving long-term care services and provided care that allowed the decedent to remain at home. (An Affidavit is required)
C. Conditions (1), (2), and (3) below have been met:
- The fair market value of the homestead is less than $250,000.00. If the fair market value of the homestead exceeds this amount, the first $250,000.00 shall be subject to the provisions of rule 7018.3
- A sibling or lineal heir of the deceased Medicaid beneficiary will inherit the homestead. A lineal heir is a direct descendant, such as a child or grandchild.
- The heir meets one or both of conditions (a) and (b) below
a. The heir has gross family income below 300 percent of the federal poverty level. (Please see the chart on the Estate Recovery Rules section below if further questions about gross family income.) (DVHA 13 and DVHA 15 forms are required - See below)
b. The heir demonstrates that significant services or financial support provided to the deceased person by heirs meeting condition (2) or the spouses of such heirs enabled the person to avoid long-term care or delay it at least six months. (Please see the Estate Recovery Rules section below for further information on this part of the exemption) (DVHA 13 and 14 Forms are required - See below)
Homestead Exemption Forms:
**Please note that the DVHA 13 Homestead Exemption Form needs to be completed when sending in either the DVHA 14 Caregiver Exemption Request Form or the DVHA 15 Household Income Below 300 percent of the Federal Poverty Level Exemption Form.
- DVHA 13: Homestead Exemption Request Form
- DVHA 14: Caregiver Exemption Request Form
- DVHA 15: Household Income Below 300 percent of the Federal Poverty Level Exemption Request Form
- Estate Recovery Rules
**Please mail paperwork to:
Department of Vermont Health Access
Member/Provider Services Unit
280 State Drive, NOB 1 South
Waterbury, VT 05671-4020
If any questions, please call Jennifer Whalen at 802-241-9343 or email jennifer.whalen@vermont.gov