Short Answer

In North Carolina, Medicaid can seek repayment from a deceased recipient’s probate estate, including the home, if other estate assets are insufficient. You do not automatically have to sell the house, but a sale may be required to pay an allowed Medicaid claim unless a deferral or waiver applies (such as a surviving spouse or an undue hardship determination). The personal representative must give proper notice to Medicaid and consider a hardship request before liquidating real property.

Understanding the Problem

In North Carolina, can you, as a caregiver child, keep living in a parent’s home if Medicaid asks the personal representative to sell it to repay benefits? Here, the parent’s house was in the parent’s sole name at death. The issue is whether the estate must liquidate that real estate to satisfy a Medicaid claim, or whether you can pursue an undue hardship path to avoid a sale.

Apply the Law

Under North Carolina law, the Department of Health and Human Services (DHHS) may recover certain Medicaid costs from the decedent’s probate estate after death. The personal representative (PR) must publish a notice to creditors and also mail notice to DHHS’s Division of Health Benefits. DHHS must then present its claim within the claims window to be paid according to statutory priority. If the estate lacks liquid assets, real property may be sold with approval from the Clerk of Superior Court to create funds to pay allowed claims. However, recovery can be deferred or waived in limited circumstances, including a surviving spouse, certain dependent children, or an undue hardship determination, which can include caregiver situations.

Key Requirements

• Medicaid’s estate claim: DHHS may assert a claim against the decedent’s probate estate for covered services; the claim begins at death and is handled like other estate debts.
• Notice to Medicaid: The PR must mail creditor notice to the Division of Health Benefits so the claim window starts; missing this step can delay closure and affect deadlines.
• Timely presentation and priority: DHHS must file its claim within the statutory window; allowed claims are paid by class, with Medicaid recovery in the same statutory class as certain judgment liens.
• Using real property to pay claims: If personal assets are insufficient, the PR (or, if needed, a court‑appointed fiduciary) may seek authority from the Clerk to sell real property to pay claims.
• Hardship/deferrals: Recovery is deferred if certain relatives survive (e.g., spouse), and DHHS may grant an undue hardship waiver in caregiver scenarios when criteria are met.

What the Statutes Say

• North Carolina Gen. Stat. § 108A-70.5 (Medicaid Estate Recovery) – Authorizes the state to recover certain Medicaid costs from a recipient’s estate, with limited exemptions and hardship considerations.
• North Carolina Gen. Stat. § 28A-14-1 (Notice to creditors) – Requires publication and mailing to known creditors, including the Division of Health Benefits when the decedent received Medicaid.
• North Carolina Gen. Stat. § 28A-19-3 (Time limits to present claims) – Bars untimely claims; mailed notice generally triggers a 90‑day presentation period for that creditor and at least three months from first publication overall.
• North Carolina Gen. Stat. § 28A-19-6 (Order of payment of claims) – Sets the priority of claims; Medicaid recovery is paid in its statutory class after higher‑priority expenses and taxes.

Analysis

Apply the Rule to the Facts: The home is solely in your parent’s name, so it is a probate asset available to pay allowed estate claims if personal property won’t cover them. The PR must send proper notice to the Division of Health Benefits and evaluate any DHHS claim filed within the window. If no surviving spouse or qualifying dependent lives in the home and DHHS denies undue hardship, the PR may need to seek court authority to sell. If DHHS grants a caregiver undue hardship waiver, estate recovery against the home can be deferred or waived, avoiding a sale.

Process & Timing

1. Who files: The Personal Representative. Where: Estate Division, Clerk of Superior Court in the North Carolina county of domicile. What: Publish notice to creditors and file the Affidavit of Notice to Creditors (AOC‑E‑307); mail creditor notice to the Division of Health Benefits. When: Mail to DHHS within 75 days after qualification; creditors must have at least three months from first publication, and DHHS generally has 90 days from its mailed notice to present a claim.
2. Evaluate DHHS’s filed claim and gather support for an undue hardship request (caregiving history, residency, medical documentation). Submit the hardship application to DHHS by the deadline in its notice. County timing varies; expect weeks to a few months for claim review and any waiver decision.
3. If the claim is allowed and funds are short, petition the Clerk for authority to sell real property to pay debts. After approval and sale, pay claims by statutory priority and close the estate with a final accounting.

Exceptions & Pitfalls

• Surviving spouse or certain dependent children living in the home can defer or bar recovery; confirm whether any statutory deferral applies before considering a sale.
• Missing the mailed notice to DHHS delays or complicates the claim window; always document publication and mailing.
• Late or deficient DHHS claims may be barred; verify filing dates against the notice deadlines before paying.
• Real property sales require court authority; filing without proper notices or inventories can be denied or delayed.
• Judgment liens docketed before Medicaid recovery may take priority; check title and lien status before distributing proceeds.

Talk to a Probate Attorney

If you’re dealing with a potential Medicaid estate recovery against a family home, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at [919-341-7055].

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.