Georgia Medicaid Estate Recovery: Can Medicaid Take Your Parent's House?

After your parent passes away, Georgia's Medicaid Estate Recovery Program (MERP) can file a claim against their probate estate to recoup every dollar of long-term care benefits Medicaid paid. If your parent received nursing home Medicaid for three years at $8,000 per month, the state's claim could exceed $288,000.

The family home is often the largest asset at risk. But Georgia's estate recovery rules have specific limits and exceptions that determine whether Medicaid can actually reach it.

Georgia's Probate-Only Recovery Rule

This is the most important thing to understand: Georgia is a "probate-only" estate recovery state. MERP can only pursue assets that pass through the deceased's probate estate. It cannot use the expanded definition of "estate" that some states employ to reach non-probate assets.

Assets that pass outside of probate are completely protected from estate recovery:

• Joint tenancy with right of survivorship (JTWROS) — property held in joint tenancy passes to the surviving owner automatically at death, bypassing probate
• Payable-on-death (POD) and transfer-on-death (TOD) accounts — bank accounts and investment accounts with designated beneficiaries transfer directly
• Named beneficiary designations — life insurance policies and retirement accounts with named beneficiaries
• Enhanced life estate (Lady Bird) deeds — real property transferred through a properly drafted enhanced life estate deed

This distinction is critical for families trying to protect the family home. If the home is titled solely in your deceased parent's name with no survivorship or transfer mechanism, it passes through probate and MERP can claim it. If the home is held in JTWROS with a surviving spouse or child, or transferred via a Lady Bird deed, MERP cannot reach it.

The $25,000 Minimum Value Exemption

Georgia exempts estates with a gross value of $25,000 or less from estate recovery entirely. Additionally, the state waives any claims against the first $25,000 of any estate subject to recovery.

This means if your parent's probate estate is worth $30,000, MERP can only pursue recovery of $5,000 — even if the state paid hundreds of thousands in Medicaid benefits.

Mandatory Deferrals

MERP must defer estate recovery — meaning the state cannot pursue its claim yet — if the deceased Medicaid recipient is survived by:

• A spouse (of any age)
• A child under age 21
• A child of any age who is blind or permanently disabled under Social Security Administration guidelines

The deferral lasts until the surviving qualifying person no longer lives in the home, dies, or the exempting condition ends. Once the deferral lifts, MERP can then pursue its claim against any remaining probate assets.

The Caregiver Child Exception

An adult child who meets all of the following criteria can apply for a hardship waiver that protects the family home from estate recovery:

• Lived in the parent's home for at least two continuous years immediately before the parent's admission to a nursing home
• Provided care during that period that demonstrably delayed the parent's institutionalization
• Can document both the residency and the caregiving with records (utility bills, medical records, caregiver logs)

If approved, the home can be transferred to the caregiver child without penalty or recovery — both during the parent's lifetime (without triggering a Medicaid transfer penalty) and after death (without MERP claiming the property).

This exception is narrow and strictly enforced. "Visiting frequently" or "helping out on weekends" doesn't qualify. The child must have physically lived in the home full-time for the required period.

The Sibling Equity Exception

A sibling of the deceased Medicaid recipient who holds an equity interest in the home and lived in the property for at least one continuous year immediately before the recipient's nursing home admission can block estate recovery on the home.

This exception is less commonly used but applies in situations where siblings co-owned the family home and one continued to live there while the other entered a care facility.

The Lady Bird Deed Strategy

Georgia doesn't have a statutory Lady Bird deed, but attorneys use common-law principles to draft Enhanced Life Estate deeds that accomplish the same result:

• The parent (grantor) retains the right to live in the home, collect rent, and sell or revoke the deed during their lifetime
• Because the grantor retains full control, the deed is not treated as a transfer of assets for less than fair market value — so it doesn't trigger a 60-month lookback penalty
• At the parent's death, the property passes directly to the named remainder beneficiaries outside of probate
• Because it bypasses probate, MERP cannot recover against it

This must be set up while the parent has capacity to execute the deed — and ideally before applying for Medicaid, to ensure the deed is properly structured to avoid lookback issues.

Protecting the Home: Practical Steps

1. Check the title. If the home is in your parent's name alone, it's a probate asset subject to MERP. Consider JTWROS with a surviving spouse or a Lady Bird deed.
2. Document caregiving. If you live with your parent and provide care, maintain records that could support a caregiver child exception claim.
3. Review beneficiary designations. Bank accounts, investment accounts, and insurance policies with named beneficiaries bypass probate automatically.
4. Don't assume transfers are safe. Gifting the home outright within the 60-month lookback period triggers a Medicaid transfer penalty calculated at $11,122 per month of ineligibility.

The Georgia Power of Attorney & Guardianship Kit includes an estate recovery reference guide and asset inventory worksheet that helps families identify which assets are at risk and which protection strategies apply to their situation.

See more Georgia guides →