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Enrollment in the Health Benefits for Immigrant Adults (HBIA) program will be temporarily paused effective July 1, 2023.

Guide to the Medicaid Estate Recovery Program

Medicaid is a State and Federally funded program that offers healthcare access for nearly one out of every four Illinoisans. Some of these services are provided to people as they grow older. Medicaid pays for services that help people stay in their own homes. It also pays for people to live in long-term care facilities when these are appropriate for their care.

To help pay for these long-term services, every state must have a Medicaid Estate Recovery Program. For those who received assistance through the Aid to the Aged, Blind or Disabled (AABD) program, the state of Illinois has the obligation to ask for money back from their estate after they pass away. In some cases, the state may not ask for anything back, and the state will never ask for more money than it paid for services.

This program is administered by the Illinois Department of Healthcare and Family Services Bureau of Collections in cooperation with the Illinois Department of Human Services.  

How does this program work?

When a person applies for Medicaid and long-term services and supports, the state provides a notice that explains the process. When the person dies, the state sends a different notice to the estate representative or heirs to let them know that the state intends to file a claim. The notice will ask the representative for information so the state can decide whether to file an estate recovery claim.

What is an estate?

An estate is property, such as money, a house, or other things of value that a person leaves to family members or others (heirs) when he or she dies. Estate recovery does not apply to all property that a person may own.

Examples of property that the state will not collect on include:

  • Life insurance policies that name a person to receive the payment.
  • Bank accounts that are paid on death to another person.

Are there times when the state will not ask for money back?

Yes, the state will not ask for money back when:

  • There is a spouse who is still alive.
  • There is a child under 21 years of age.
  • There is a child of any age who is blind or permanently and totally disabled under Social Security requirements.
  • The value of the estate is $25,000 or less, pending Federal approval.
  • The cost of selling the property is more than the property is worth.

Also, the state will not ask for money when this would cause an undue hardship for the heirs.

How does the state define undue hardship?

The state may consider it a hardship when:

  • The estate property was a family business, farm, or ranch for at least 12 months before the person on Medicaid died and is the main source of income for the heirs.
  • The heirs would need financial help from the government if the state filed a claim to get money back.
  • The heirs could stop getting financial help from the government if the state did not file a claim.
  • There are other circumstances that may create a hardship.

The state will not grant a hardship request unless the person's heirs ask for it and provide the


If the estate has debts, such as funeral costs, legal costs, or a home mortgage, those costs are paid before an estate recovery claim is paid.