One of the most stressful discoveries families can make during an estate administration is learning that a nursing home bill, a MassHealth lien, or a MassHealth estate recovery claim may affect the family home.
Many people immediately assume the house cannot be sold until the claim is resolved, or that the family will “lose the house.” Fortunately, that is usually not the case.
In most situations, the property can still be prepared, listed, and sold, and the claim is resolved as part of the closing, much like paying off a mortgage.
First, Figure Out What Kind of Claim It Is
“Nursing home lien” is often used as a catch-all phrase, but in Massachusetts it can mean several very different things. Knowing which one you are dealing with is the first step.
1. A MassHealth estate recovery claim. When a person who received certain MassHealth benefits passes away, MassHealth may be required to seek repayment from their estate. This is a claim against the estate, typically handled through the probate process.
2. A MassHealth lien recorded on the property. In some cases, typically when a member is permanently living in a nursing home, MassHealth may record a lien against their home at the Registry of Deeds while they are still alive. A recorded lien shows up in a title search and must be addressed before the property can be sold with clear title.
3. An unpaid nursing home bill. If the nursing home itself is owed money (for example, private-pay charges), that is generally treated like other debts of the estate. It is not automatically a lien on the house, but it may need to be paid from estate assets, including sale proceeds.
An estate attorney can confirm which of these applies, and a title search will show whether anything has actually been recorded against the property.
What Is MassHealth Estate Recovery?
Federal and Massachusetts law require MassHealth to seek repayment, after death, for certain benefits it paid. Generally, this applies to members who were 55 or older when they received long-term care services, such as nursing home care and certain home and community-based services, and to members of any age who were permanently in a nursing home or similar facility.
A few important points families should know:
- Recovery is limited to the probate estate. Under current Massachusetts rules, MassHealth recovers only from assets that pass through probate, meaning assets owned solely by the person at death. Property that passes outside of probate, such as property held jointly with a right of survivorship or held in certain trusts, generally falls outside the probate estate. How the property was titled matters a great deal.
- Recent changes narrowed what is recovered. A 2024 change to Massachusetts law limited estate recovery to what federal law requires, primarily long-term care costs, for members who died on or after August 1, 2024.
- Recovery may be deferred. MassHealth generally cannot recover while there is a surviving spouse, a child under 21, or a child who is blind or permanently and totally disabled.
- Hardship waivers and small estates. MassHealth may waive all or part of a claim in cases of undue hardship, and very small estates may be exempt.
- MassHealth must receive notice. In Massachusetts probate cases, the personal representative must notify MassHealth of the estate, which allows MassHealth to present any claim.
Because these rules change and every situation is different, the amount and validity of any claim should always be confirmed, not assumed.
Can the Property Still Be Listed for Sale?
In most cases, yes.
One of the biggest misconceptions is that families must completely resolve a MassHealth or nursing home issue before the property can even be marketed. In reality, the claim and the sale can often move forward side by side.
While the legal side is being handled, families can often begin:
- Determining market value
- Reviewing title and identifying any recorded liens
- Coordinating cleanouts
- Evaluating repairs and deferred maintenance
- Preparing the property for sale
- Developing a marketing plan
Of course, the person signing the deed still needs proper authority. If the property is in the deceased owner’s name, a Personal Representative must generally be appointed through the Probate and Family Court first. (See our article What Is a License to Sell in Massachusetts, and Can You List a Property Before Obtaining One?)
How Is the Claim Paid at Closing?
In many situations, the claim is handled very much like a mortgage payoff:
- Before closing, the estate’s attorney or the closing attorney requests a payoff or claim amount from MassHealth (or obtains the final balance from the nursing home).
- The amount is confirmed and, where appropriate, reviewed for errors, deferrals, or possible hardship waivers.
- At closing, the claim is paid directly from the sale proceeds.
- If a lien was recorded, a release of lien is obtained and recorded so the buyer receives clear title.
This allows the sale to move forward while ensuring the obligation is properly addressed. Any remaining proceeds are then handled by the estate according to Massachusetts law and the will, if there is one.
Why Selling Sooner Can Help
Families dealing with these claims are often also facing:
- A vacant home
- Ongoing property taxes, insurance, and utilities
- Winterization and maintenance concerns
- Mortgage or reverse mortgage obligations
- Disagreements or uncertainty among heirs
Carrying costs continue every month the property sits. Starting early, getting accurate information, and developing a plan usually leads to a smoother sale and better results for everyone involved.
Common Mistakes to Avoid
- Assuming the house is lost. Many properties with MassHealth claims are successfully sold every year.
- Assuming the claim is correct. Claim amounts should be verified, and exemptions, deferrals, or hardship waivers may apply.
- Waiting to do anything. Value, title, cleanout, and repair planning can usually begin right away.
- Distributing money too early. Heirs should not receive proceeds until valid claims, taxes, and expenses are addressed.
- Ignoring how the property was titled. Whether the home was in the person’s name alone, held jointly, or held in a trust can change the entire analysis.
A Quick Checklist for Families
- Locate the deed and confirm how the property was titled.
- Gather any MassHealth notices or nursing home statements.
- Speak with an estate or elder law attorney about the claim and the probate process.
- Order a title search to see whether a lien has been recorded.
- Secure the property and confirm insurance coverage.
- Speak with an experienced real estate professional about value, condition, and timing.
We’ve Helped Families Navigate These Situations
At Capital Realty Group, we have worked with inherited and estate-owned properties involving MassHealth claims, mortgages, reverse mortgages, liens, title issues, estate debt, deferred maintenance, cleanouts, and a variety of other challenges.
In our experience, situations that first appear overwhelming are often far more manageable once the facts are understood and a plan is in place. We work closely with estate and elder law attorneys so the legal and real estate sides of the sale move forward together.
Need Guidance Regarding an Estate Property?
At Capital Realty Group, we regularly assist personal representatives, trustees, beneficiaries, and families with inherited, estate-owned, and trust-owned real estate throughout Massachusetts.
Our goal is simple: help families understand their options, navigate the process efficiently, and move forward with confidence.
Related reading: What Is a License to Sell in Massachusetts? · What Happens to Real Estate When Someone Dies Without a Will? · What Happens to a Reverse Mortgage When the Homeowner Dies? · Does Property Held in a Trust Need Probate in Massachusetts?
For a Free Consultation
Michael Lord
Phone: 508-395-8333
Email: [email protected]
About the Author
Michael Lord is a Massachusetts real estate broker, attorney, and owner of Capital Realty Group. He works with buyers, sellers, trustees, personal representatives, and families involved in inherited, trust-owned, and estate-related real estate transactions throughout Massachusetts.
Capital Realty Group provides real estate brokerage services. This article is for general information only and is not legal advice. MassHealth rules change and every situation is different; consult an estate or elder law attorney about your specific circumstances. Our brokerage services do not create an attorney-client relationship.
