Medicaid Eligibility Services and Estate Recovery Laws in New Jersey

By Fredrick P. Niemann, Esq. of Hanlon Niemann, Monmouth County, NJ Medicaid Law Firm

Medicaid is a government health care program designed to ensure that medical treatment is available to those individuals whose income and resources are inadequate to otherwise provide for such care. In order to be eligible for Medicaid, applicants must meet certain requirements which include being a resident of New Jersey, a U.S. Citizen or qualified alien (most immigrants who arrive after August 22, 1996 are barred from Medicaid for five years, but could be eligible for NJ FamilyCare and certain programs for pregnant women), and applicants must also meet specific standards for financial income and resources.

Income with regard to Medicaid eligibility includes both cash income and in-kind income. It also considers a person’s resources. Cash income includes employment earnings (salary, social security, pension benefits, and tax refunds). In-kind income includes food or shelter, or something the individual uses to obtain either food or shelter. Subject to certain exceptions, states are required to exempt certain categories of income and resources when determining eligibility. For example, food stamps are exempt from income in determining an applicant’s Medicaid eligibility in New Jersey. Resources include cash or other property that can be liquidated or converted into cash-in-hand such as stocks and bonds.


Once an applicant is determined eligible to receive benefits, New Jersey provides the following services to Medicaid recipients:

  • Inpatient and outpatient hospital treatment
  • Laboratory tests and X-rays
  • Early and Periodic Screening, Diagnostic and Treatment services
  • Home health care
  • Physician services
  • Nurse-midwife services
  • Assistance with family planning and any necessary supplies
  • Nursing facilities for people over 21


Treatment in residential treatment centers

  • Optical appliances
  • Dental care
  • Optometry services
  • Chiropractic services
  • Psychologist
  • Podiatrist
  • Prosthetics and orthotics
  • Drugs necessary during long term care
  • Drugs at retail cost
  • Durable medical equipment
  • Hearing aid services
  • Hospice care
  • Transportation
  • Personal care services
  • Licensed practitioner services
  • Private duty nursing
  • Services in a clinic
  • Physical, occupational and speech therapy
  • Inpatient psychiatric care for individuals under 21 and over 65
  • Intermediate care facilities for the mentally retarded

As noted above, certain classes of assets are exempted when determining eligibility for Medicaid, and because of this a Medicaid recipient may be sufficiently needy to qualify for Medicaid and yet still leave a considerable estate when they pass away. When an individual who receives Medicaid benefits passes away Federal law mandates that states must pursue Medicaid estate recovery. Estate recovery is the process by which the state seeks to recover the amount spent on the recipient’s behalf from their exempt assets after the recipient’s death.

New Jersey’s estate recovery provisions are found New Jersey’s state statutes at N.J.S.A. 30:4D-7.2 and New Jersey’s administrative regulations at N.J.A.C. 10:49-14.1. New Jersey may recover for care given to institutionalized individuals as well as for home and community-based care and for prescription drug services. New Jersey law outlines certain situations when estate recovery cannot be made. These include when the Medicaid recipient has a surviving child under 21 or a blind or permanently and totally disabled child. The policy of estate recovery makes advance legal planning critical for families of such Medicaid recipients with exempt assets.

To discuss your NJ Medicaid matter, please contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at Please ask us about our video conferencing consultations if you are unable to come to our office.