Oregon Medicaid Estate Recovery 2026: Will They Take the House?

Oregon Medicaid estate recovery is how the state seeks repayment, after a recipient's death, for long-term care it paid through the Oregon Health Plan (OHP). It mainly reaches recipients who were 55 or older when Medicaid paid for their long-term care, and Oregon uses an expanded estate definition that reaches assets passing outside probate. The Oregon Department of Human Services (ODHS) Estate Administration Unit runs the program under ORS 416.350 and OAR 461-135-0832.1

This guide explains who is at risk, what Oregon can reach, who the law shields, and how to respond if ODHS files a claim.

The 60-Second Version

• The expanded estate also reaches tenancy by the entirety and annuities bought on or after April 1, 2001 (OAR 461-135-0832).1
• Recovery is run by the ODHS Estate Administration Unit, the office to ask whether a claim exists.1
• ODHS may waive a claim that would cause undue hardship to heirs or family members.2
• Under federal law, the caregiver-child protection holds off recovery only against a home that carried a lien placed while the parent was in a facility, and only while that child lives there.3
• Oregon's rule excludes correctly made payments since January 1, 2010 for Medicare cost-sharing (the help a Medicare Savings Program gives) from a claim.2

What Estate Recovery Is and Where the Rules Come From

Medicaid estate recovery is a federal requirement. It comes from the Omnibus Budget Reconciliation Act of 1993 (OBRA '93), codified at 42 USC 1396p(b), which bans recovering correctly paid benefits except in three cases where every state must seek recovery: an institutional resident of any age who must spend nearly all income on care and whom the state has determined, after notice and a chance for a hearing, can't reasonably be expected to return home; a recipient who was 55 or older, for nursing-facility services, home- and community-based services (HCBS), and related hospital and prescription-drug services; and certain people with long-term care insurance whose assets were disregarded.3

States may go further. For a recipient 55 or older, a state may recover for any Medicaid plan service except Medicare cost-sharing and Medicare Savings Program benefits, and it may expand the estate definition to non-probate assets under 42 USC 1396p(b)(4)(B).3 Oregon's statute, ORS 416.350, makes that election, defining the estate to include "all real and personal property and other assets in which the deceased individual had any legal title or interest at the time of death, including assets conveyed to a survivor, heir or assign of the deceased individual through joint tenancy, tenancy in common, survivorship, life estate, living trust or other similar arrangement." So Oregon recovery is not limited to probate assets.1

The Oregon Health Plan is administered by the Oregon Health Authority (OHA). ODHS handles long-term-care eligibility through its Aging and People with Disabilities (APD) program, and its Estate Administration Unit handles recovery.1

Who Is Affected in Oregon

Recovery doesn't reach every OHP recipient. ORS 416.350 authorizes it for assistance paid to a recipient who was 55 or older and to a permanently institutionalized recipient of any age.1

Oregon then narrows it. For benefits paid on or after October 1, 2013, OAR 461-135-0835(4)(f)(D) limits the claim to what Medicaid paid while ODHS was covering the recipient's nursing-facility care, home- and community-based care, or in-home State Plan Personal Care Services. Regular medical coverage paid outside those periods isn't part of the claim.1

One payment sits outside that window. For a recipient 55 or older, what Oregon paid the federal government after December 31, 2013 for the recipient's Medicare Part D prescription drug coverage is a claim against the estate in its own right (OAR 461-135-0835(5)).1

Help through a Medicare Savings Program isn't part of a claim: Oregon's rule excludes "all correctly made payments on or after January 1, 2010 for Medicare cost sharing."2 That Oregon rule does the work, because the federal carve-out for Medicare cost-sharing covers only a state's optional recovery, not the mandatory recovery for long-term care and related hospital and drug services.3

For context, Oregon is an income-cap state. For nursing-facility or HCBS-waiver coverage, the income standard is 300% of the SSI standard, $2,982 per month in 2026, and an applicant over it must set up an Income Cap Trust, Oregon's name for a Qualified Income Trust (a Miller Trust elsewhere). The asset limit is $2,000 for one person and $3,000 for a two-person need group. The trust shelters nothing at death: whatever is left must be paid to the state, up to the medical assistance Medicaid provided, and the spouse and child deferrals don't apply to that payback.2

What Oregon Medicaid Estate Recovery Can Reach

Because Oregon uses an expanded estate definition, recovery is not limited to the probate estate. Under ORS 416.350 and the ODHS estate-administration rule OAR 461-135-0832, the recoverable estate includes any property in which the recipient held legal title, ownership, or a beneficial interest at death, plus property that passed to another person through any of these arrangements:1

So titling a home jointly, naming a payable-on-death beneficiary, or signing a transfer-on-death deed does not automatically protect that asset from Oregon recovery. Confirm what is reachable with the ODHS Estate Administration Unit or an Oregon elder-law attorney before relying on any transfer.1

Funeral costs can come first, within a cap. For deaths on or after January 1, 2025, where ODHS is a claimant and the estate can't pay its claim in full after funeral costs, OAR 461-135-0833 allows not more than $6,000 of estate assets for the funeral, less any prearranged funeral trust, burial funds, burial life insurance or burial insurance. ODHS's example: with a $1,200 prepaid cremation plan, the family may spend up to $4,800 more.1

Who Is Protected

Federal law at 42 USC 1396p(b)(2) holds off recovery while certain family members survive or, for a home that carried a lien, live there.3 Oregon's rules at OAR 461-135-0835 write the spouse and child protections as deferrals, not cancellations.1

Surviving spouse. ODHS must wait until the recipient's spouse has died. Then the claim can follow the property: ORS 416.350(2) allows recovery "from any recipient of property or other assets held by the individual at the time of death including the estate of the surviving spouse," and OAR 461-135-0835(4)(d) limits that to what the spouse received from the recipient through probate or by operation of law. So a widow's own estate can be reached for her late husband's Medicaid, up to what she got from him.1

Child under 21. A surviving child under 21 defers the claim until that child turns 21, whether or not the child has any tie to a particular asset.1

Child with a disability or visual impairment. A child who is blind, has a visual impairment, or is permanently and totally disabled also defers the claim. Under OAR 461-135-0835(4)(d)-(e), a claim for correctly paid Medicaid benefits "is deferred until the time that there is no child under age 21, child with a disability, or child with a visual impairment."1

Sibling living in the home. Federal law has two sibling tests. During life, no lien may be placed on the home while a sibling with an equity interest who lived there at least a year before the admission lawfully lives there. After death, where the home carried such a lien, recovery against it waits while a sibling who lived there at least a year before the admission, and continuously since, still lives there; no equity interest is needed. Neither bars recovery against every home.3

Caregiver child. Under 42 USC 1396p(c)(2)(A)(iv), a parent can transfer the home during life, without a transfer penalty, to an adult child who lived there for at least two years immediately before institutionalization and who, as determined by the state, provided care that kept the parent at home. After death, 42 USC 1396p(b)(2)(B)(ii) holds off recovery against the home while that child still lives there, having lived there continuously since the admission, but on its face only for a home that carried a lien (see "Liens on Real Property" below). Whether Oregon protects a home with no lien the same way isn't answered by the rules cited here, so ask ODHS.3

When a protection applies, the estate administrator or a family member should tell ODHS in writing, with documentation. The spouse and child deferrals cover the whole estate, not just the home, for as long as the protected person qualifies.1

The Undue-Hardship Waiver

Federal law at 42 USC 1396p(b)(3) requires every state to establish procedures for waiving recovery when it would work an undue hardship.3 Oregon's rule, OAR 461-135-0841, lets ODHS waive enforcement of any estate recovery claim "if it finds that enforcing the claim would result in an undue hardship to the beneficiaries, heirs, or family members of the deceased client."2 HHS reports that states "have considerable discretion in their definition of hardship," and that federal guidelines point to "homesteads of modest value and income-producing property, such as farms or family businesses that are essential to the support of surviving family members."3

Spousal Protection and the Community Spouse

Estate recovery is deferred while the surviving spouse lives, but spousal protection starts earlier, at eligibility. When one spouse needs nursing-facility or HCBS-waiver care, Oregon's spousal-impoverishment rules let the community spouse (the one at home) keep a share of the couple's resources and income. Under OAR 461-160-0580 the resource allowance is the largest of four amounts: the community spouse's half of the couple's countable resources, up to $162,660; a $32,532 state standard; a court-ordered allowance; or the amount needed to raise the community spouse's income to the monthly maintenance needs allowance. The last two carry no dollar cap. The income allowance is built on a Minimum Monthly Maintenance Needs Allowance of $2,705.00 (effective July 1, 2026) and a maximum of $4,066.50, and federal law lets either spouse seek more at a fair hearing when exceptional circumstances cause significant financial duress.2

Resources that are the community spouse's own aren't part of the recipient's estate. What the spouse receives from the recipient is different: after the spouse dies, the claim can reach it in the spouse's estate if it passed through probate or by operation of law.1 For how Oregon divides a couple's income and assets, see our guide to Oregon Medicaid spousal impoverishment protections.2

Liens on Real Property

Federal law at 42 USC 1396p(a) lets a state place a lien during life on the home of a nursing-facility or other institutional resident whom it has determined, after notice and a chance for a hearing, can't reasonably be expected to be discharged and return home. No such lien may be placed while a spouse, a child under 21 or blind or permanently and totally disabled, or a sibling with an equity interest who lived there at least a year before the admission, lawfully lives in the home. The lien dissolves if the recipient is discharged and returns home. A lien is separate from post-death estate recovery.3

A Realistic Timeline: Death to Resolution

An Oregon estate recovery claim moves through a predictable sequence, from the recipient's death through resolution of any ODHS claim.1,3

Recovery begins only after the recipient's death, and only once the spouse and child protections have ended. ODHS can recover what Medicaid actually paid (the long-term-care window plus any Part D payments), never more, and only from the recoverable estate, which after a surviving spouse's death can include what that spouse received from the recipient.1

Worked Example 1: A Married Couple and the Family Home

This is an illustrative scenario. Dolores, 81, received two years of OHP-funded nursing-facility care for advanced dementia before her death. Her husband Frank, 83, still lives in the home they have owned jointly for 40 years. When Dolores qualified, their savings were divided under Oregon's spousal rules, and Frank kept his resource allowance: in the ordinary calculation, his half of their countable resources, up to $162,660.2

When Dolores dies, ODHS can't pursue its claim while Frank is living, and the jointly held home passes to Frank. But deferral isn't protection. After Frank dies, the claim for Dolores's care becomes a claim against Frank's estate to the extent he received property from her through probate or by operation of law, and Oregon's statute expressly reaches "the estate of the surviving spouse." Re-titling the house in Frank's name doesn't change where it came from. A couple in this position should see an Oregon elder-law attorney while Frank is alive.1

Worked Example 2: A Caregiver Daughter Who Lived in the Home

This is an illustrative scenario. Raymond, 79, received two years of OHP-funded HCBS waiver care at home before entering a nursing facility, where he died. His daughter Anita moved in with him five years before his institutionalization and provided the daily care that kept him at home that long. She still lives in the house, which Raymond owned in his sole name.

Because Raymond owned the home alone, it would normally be within Oregon's reach. Anita may have narrower protection than it seems. Had Raymond deeded her the home during his life, the caregiver-child rule would have spared that transfer a penalty, if the state agreed her care kept him at home. After his death, federal law holds off recovery while she keeps living there, but on its face only if the home carried a lien Oregon placed while Raymond was in the facility; whether Oregon goes further isn't settled by the rules cited here. Anita should document her move-in date, the care she provided, the physician records showing it delayed his admission, and her continued residency, and present them to the ODHS Estate Administration Unit.3

How to Respond to an Oregon Medicaid Estate Recovery Claim

When an Oregon Health Plan long-term-care recipient dies and an estate is being administered, work through these steps.2,1,3

Where to Get Help

If you have questions about Oregon Medicaid estate recovery, hardship waivers, or planning options, start with these resources.1,2

Learn More

Oregon estate recovery sits inside the broader Medicaid long-term-care framework; these guides cover the rules that feed into it.1

Find personalized help understanding Oregon Medicaid estate recovery at brevy.com.

The information on Brevy.com is for educational purposes only and is not a substitute for professional legal, financial, or medical advice. Rules vary by state and program and change frequently. Always verify with the relevant agency or a qualified professional. Brevy is not a law firm, financial advisor, or healthcare provider.