A bill intended to close a loophole that allows individuals to shield assets from reimbursement for Medicaid-related services passed May 7.
LB72, sponsored by Columbus Sen. Paul Schumacher, prohibits a trustee of a revocable trust that has become irrevocable due to the death of the trustor from transferring trust property to a beneficiary prior to satisfaction of all claims for Medicaid reimbursement.
The state Department of Health and Human Services (DHHS) may waive the restrictions within 60 days if there are no claims for Medicaid reimbursement or insufficient assets to satisfy the claims.
A trustee may distribute assets from a trust prior to receiving a waiver from DHHS if the trustee signs a recital under oath that no claims for medical assistance exist.
The bill also requires that if a petition is filed to determine inheritance tax, notice of the hearing will be sent to DHHS if the decedent was 55 or older or resided in a medical institution that potentially would subject them to debt for Medicaid services.
LB72 passed on a 40-8 vote.