Medicaid recipients must constantly maintain assets below $2,000.00. If their assets ever exceed $2,000 at the end of any calendar month, they will no longer be Medicaid-eligible. So, when someone receives a lump sum inheritance from a recently-deceased family member, the lump sum of money can be most unwelcome.
Within 10 days of receiving an inheritance, each Medicaid recipient is obligated to report the change in circumstance to the Social Security Administration and Department of Children and Families.
If the inheritance is large and Medicaid is no longer needed
If the inheritance is rather large, and the Medicaid recipient will be comfortable without Medicaid assistance, then the process ends here. After you inform Medicaid of the change in circumstances (i.e. the large inheritance), Medicaid benefits will cease and the former Medicaid recipient will private pay for their care. If the Medicaid recipient is receiving a large inheritance, there is nothing wrong with removing oneself from the Medicaid program.
Even if you are comfortable giving up Medicaid, you still want to inform them of the change in circumstances because Medicaid will ask you to payback the amount of money Medicaid laid out while you were no longer eligible. For example, if you receive an inheritance in January but don’t inform Medicaid and they continue to pay benefits...read more here.