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Medicaid’s Dark Secret

Sep 17, 2019

Medicaid’s Dark Secret

For many participants, the program that provides health care to millions of low-income Americans isn’t free. It’s a loan. And the government expects to be repaid.

The folded American flag from her father’s military funeral is displayed on the mantel in Tawanda Rhodes’s living room. Joseph Victorian, a descendant of Creole slaves, had enlisted in the Army 10 days after learning that the United States was going to war with Korea.

After he was wounded in combat, Joseph was stationed at a military base in Massachusetts. There he met and fell in love with Edna Smith-Rhodes, a young woman who had recently moved to Boston from North Carolina. The couple started a family and eventually settled in the brick towers of the Columbia Point housing project. Joseph took a welding job at a shipyard and pressed laundry on the side; later, Edna would put her southern cooking skills to use in a school cafeteria. In 1979, Joseph and Edna bought a house in Boston’s Dorchester neighborhood for $24,000.

Just a few years after they moved in, Joseph died of blood-circulation problems. But by leaving that house to his wife and children, its mortgage satisfied by his life-insurance payout, he died believing that he had secured a legacy for his family, which, in just a few generations, had lifted itself out of slavery, segregation, and poverty to own a piece of the American dream.

When I visited Dorchester this spring, Tawanda, 62, was waiting for me on the front porch of the three-story, vinyl-sided house. She now lives there alone, and on borrowed time.

The trouble began when her mother started showing signs of Alzheimer’s disease. For a while, one of Tawanda’s brothers cared for Edna, but he was sick himself and died in 2004. A guardian of the state admitted Edna into a nursing home and signed her up for the state’s Medicaid program, MassHealth. Tawanda was relieved that her mother was being cared for while she was busy arranging her brother’s funeral. But when she arrived in Boston from Brooklyn, where she and her husband had settled, she heard rumors about MassHealth “robbing people of their homes” as reimbursement for their medical bills.

She soon learned that the rumors held some truth. Medicaid, the government program that provides health care to more than 75 million low-income and disabled Americans, isn’t necessarily free. It’s the only major welfare program that can function like a loan. Medicaid recipients over the age of 55 are expected to repay the government for many medical expenses—and states will seize houses and other assets after those recipients die in order to satisfy the debt.

Sure enough, just weeks after Edna entered the nursing home, Tawanda received a notice that MassHealth had put a lien on the house. Tawanda called the agency and said she wanted to take her mother off Medicaid; she knew Edna had alternatives as a longtime employee of Boston Public Schools. A representative for MassHealth told her not to worry: If she took her mother out of the nursing home, the agency would remove the lien and her mother could continue to receive Medicaid benefits.

Tawanda and her husband, Oliver, decided to move to Boston. They took Edna out of the nursing facility and brought her home to care for her full time. “The place was pretty dilapidated, but I knew it was ours, so my husband and I started bringing it back to life,” Tawanda said.

Oliver and Tawanda had lived a modest but comfortable life in Brooklyn. He worked maintenance for Time Warner; she was a bartender. To renovate the old house, they cashed in all of their savings bonds, about $100,000 worth. They tore up the shag carpeting, refinished the floors, painted the walls, remounted the cabinets. They replaced the 1970s appliances—brown dishwasher, blue toilet, and mustard-colored refrigerator—with modern ones. They paid off Edna’s second mortgage, and her third.

Then, in 2007, Oliver started showing signs of dementia, and shortly thereafter, he too was diagnosed with Alzheimer’s. Now Tawanda spent her days caring for both her mother and her husband, shuttling them back and forth to doctor’s appointments, giving baths, clipping toenails, changing diapers. She cooked them special dinners “as they started not being able to chew this or swallow that.” After putting them to bed at night, if she wasn’t too tired, she’d mix herself an apple martini and read in the kitchen, often her only hour of relaxation in the day.

This went on until the end of 2009, when Edna died, at home, in Oliver’s arms. Afterward, Tawanda received a letter from the Massachusetts Office of Health and Human Services, which oversees MassHealth, notifying her that the state was seeking “reimbursement from [Edna’s] estate for Medicaid payments made on her behalf.” For Edna’s five years on MassHealth, she owed $198,660.26.

“You must be kidding me,” Tawanda recalled telling the MassHealth caseworker on the phone. As proof, the agency sent her a 28-page itemized bill for “every Band-Aid, every can of Ensure” her mother had used. The state gave Tawanda six months to pay the debt in full, after which she would begin accruing interest at a rate of 12 percent. If she couldn’t afford it, the state could force her to sell the Dorchester house and take its share of the proceeds to settle the debt.

Tawanda’s hair started falling out soon after. She and Oliver, who was in the final stages of Alzheimer’s, had no savings and no jobs. “I said to myself, I don’t care what they do to me. I can take care of myself,” she told me. “But I couldn’t have my dying husband thrown out into the street.”

She wrote to nearly every elected official in the state. “No one would help me,” she said.

The flag Rhodes’s father earned for his service in the Korean War. (Nathan Bajar)
Now instead of reading a late-night romance novel, she stayed up researching Medicaid regulations. She discovered that MassHealth allows some exceptions. It will not seize a home occupied by a spouse or a dependent child of the late Medicaid recipient until they die or move. It also offers waivers for financial hardship and an “adult child caregiver” exemption for those who lived with a parent for at least two years and “provided care that allowed the applicant to remain at home.”

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