Can Medicaid recover funds from an estate of a person who died 2 years ago?

Q: My Grandmother passed in 2016. She utilized Medicaid for the last few years of life, including staying in a constant-care rehabilitation facility and hospitalizations for a stroke. After her death, an estate was opened. We reported to the state an estate value of $9,000. In May 2018, a distant cousin passed, and the remainder of their estate was disbursed to his next of kin. A check for $80,000 was made out to the estate of Grandmother. In June 2018, the state attempted to recover Medicaid expenses – $230,000 worth. They requested a full payment of the value of the estate, which was reported as $9,000. This was paid. In that payment, the state mentions that they could attempt to recover additional money into the estate. Can the state now – 2 years after death – come for the additional inheritance that was disbursed in May 2018? Or is that money safe to disburse from the estate to the living next of kin? (Upper St. Clair, PA)

A: It is true Medicaid can recover funds payable to an estate after the estate closes, or which are discovered later for whatever reason. I find it strange that there was an asset payable to your grandmother after she passed. If your grandmother died in 2016, it would seem to me that any inheritance from a distant cousin who dies in 2018, would “lapse” under PA probate law. Meaning, generally, a dead person cannot inherit money. Their inheritance is deemed to lapse or be void upon their death. In that case, their inheritance passes to an alternate beneficiary named in the will, or an alternate beneficiary under PA intestate law if there is no will. However, I understand in fact the payment to the estate was made. I would be careful here and have an attorney examine the payment from the asset to see if it can possibly fit into

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