Do I need a will if I have a trust?

Yes. Even with a living trust, you need a pour-over will to capture any assets that weren't transferred into your trust during your lifetime. Without one, those assets pass through Oregon's intestacy laws rather than according to your wishes.

What is the difference between a will and a living trust?

A will takes effect at death and must go through probate before assets are distributed. A living trust takes effect immediately, avoids probate, and allows for faster, private transfer of assets to your beneficiaries. Trusts also provide better protection for blended families and beneficiaries who are minors or have special needs.

How much does estate planning cost in Oregon?

Track Town Law offers flat-fee estate planning services in Oregon and Idaho. Fees vary based on the complexity of your plan — whether you need a simple will package, a full revocable living trust plan, or a more complex plan involving Medicaid planning or special needs considerations. Consultations are free.

Do I need an LLC for my small business in Oregon?

Most small business owners in Oregon benefit from forming an LLC. It separates your personal assets from business liabilities, can provide tax flexibility, and signals credibility to clients and vendors. The key is not just forming the LLC but setting it up correctly with an operating agreement, a dedicated bank account, and an EIN.

What does Medicaid planning involve?

Medicaid planning involves structuring your assets and income to qualify for Oregon Medicaid long-term care benefits while protecting as much of your estate as possible. This may involve Medicaid Asset Protection Trusts, spousal protection strategies, and coordinating with VA benefits if applicable. Planning works best when started at least five years before care is needed.

Can I work with Track Town Law if I don't live in Eugene?

Yes. Track Town Law is a fully virtual firm serving clients throughout Oregon and Idaho. All meetings are conducted by video or phone, and documents are signed electronically. You never need to come to an office.

What is Oregon's estate tax threshold?

Oregon imposes its own estate tax with a threshold of $1 million — significantly lower than the federal exemption of $15 million. This means many Oregon families who wouldn't owe federal estate tax may still owe Oregon estate tax. Proper planning with trusts and other strategies can reduce or eliminate this exposure.

How do I get started with Track Town Law?

Start with a free consultation. You can book online at tracktownlaw.com/book-now. Consultations are conducted by video or phone and typically last 30 to 45 minutes. There is no obligation and no charge for the initial meeting.

Oregon Medicaid Estate Recovery: What It Is, What It Can Take, and How to Plan Around It

Jun 24

Written By Jared Hight

Oregon is one of the most aggressive states in the country when it comes to Medicaid estate recovery. If you or a loved one receives Medicaid long-term care benefits, the state may file a claim against your estate after death. Here's what Oregon families need to know.

Most people who apply for Oregon Medicaid to cover nursing home or long-term care costs understand that there are eligibility rules — income limits, asset limits, a five-year look-back period on transfers. What many don't fully understand is what happens after the Medicaid recipient dies.

Oregon operates an aggressive estate recovery program under ORS 416.310–416.351. When a Medicaid recipient dies, the Oregon Department of Human Services (ODHS) and Oregon Health Authority (OHA) are required by both federal and state law to seek reimbursement for benefits paid. That reimbursement comes from the deceased recipient's estate — which in Oregon is defined very broadly.

For families expecting to inherit a home, a savings account, or other assets, an Oregon Medicaid estate recovery claim can be a significant and unexpected financial loss. Understanding how the program works — and what planning options exist — is an important part of elder law and estate planning for Oregon families.

Who Is Subject to Oregon Medicaid Estate Recovery

Oregon's estate recovery program applies to individuals who received Medicaid benefits under any of the following circumstances:

Any individual age 55 or older who received Medicaid benefits of any kind — not just long-term care
Any individual of any age who was a permanently institutionalized inpatient in a nursing facility, intermediate care facility, or other medical institution

The age-55 trigger is broader than most people realize. It's not limited to nursing home care — it includes Oregon Health Plan (OHP) benefits of any kind paid on or after the recipient's 55th birthday. A 57-year-old who received OHP coverage for outpatient medical care, prescription drugs, or routine services may have an estate recovery claim filed against their estate.

What Oregon's Definition of "Estate" Actually Includes

Oregon uses an expanded definition of "estate" for Medicaid recovery purposes under ORS 416.350 that goes far beyond probate assets. Oregon's estate includes:

All real and personal property in which the deceased had any legal title or interest at death
Assets conveyed to a survivor through joint tenancy, tenancy in common, survivorship, life estate, or living trust

That last item is significant. A home held in a revocable living trust, property held in joint tenancy with a spouse, or a life estate — all of which would otherwise avoid probate — can still be subject to Oregon Medicaid estate recovery. As covered in the joint ownership types post, the way you hold title affects probate, but it doesn't necessarily protect against a Medicaid recovery claim.

The Oregon Court of Appeals confirmed the breadth of this definition in Department of Human Services v. Hobart (2022), where the court allowed ODHS to recover against an interest in a marital home that had been transferred to the surviving spouse prior to the Medicaid recipient's death. Oregon takes an aggressive position on what falls within the scope of recovery, and that position has been consistently upheld.

What Oregon Can Recover

ODHS and OHA may recover the total amount of Medicaid benefits paid to or on behalf of the recipient since age 55. That includes:

All Oregon Health Plan benefits paid since age 55
Long-term care costs — nursing home, in-home care, residential care, adult foster care
Medicare copays, coinsurance, and premiums paid by Medicaid
Monthly fees paid to coordinated care organizations on the recipient's behalf

The recovery amount is capped at the lesser of the total benefits paid or the value of the recoverable estate assets. Oregon cannot recover more than it paid, and it cannot force a sale of a home in excess of the claim amount.

Up to $3,500 is set aside from the estate for burial expenses before the state's claim is satisfied.

When Oregon Will Not Pursue Recovery

Oregon law prohibits estate recovery in several circumstances:

Surviving spouse. ODHS will not make a recovery claim while the Medicaid recipient's spouse is alive. The claim is deferred until after the surviving spouse's death. At that point, ODHS may file a claim against the surviving spouse's estate to recover benefits paid to the original recipient.

Minor or disabled children. Recovery is prohibited if the deceased recipient has a surviving child under age 21, or a child of any age who is blind or permanently and totally disabled under Social Security Administration criteria. The child must be a natural or legally adopted child.

Hardship waivers. Any person who receives assets from a deceased Medicaid recipient's estate may request a hardship waiver from ODHS. Waivers are available in defined circumstances and subject to strict deadlines — contact the Estate Administration Unit promptly after the recipient's death if you believe a hardship waiver may apply.

Crime victims. Oregon law prohibits recovery to the extent the need for Medicaid resulted from a crime committed against the recipient.

Tribal resources. ODHS will not make a recovery claim against tribal property or assets of unique religious, spiritual, traditional, or cultural significance under Oregon Administrative Rule 461-135-0837.

What Happens After a Medicaid Recipient Dies

When a Medicaid recipient dies, the family or personal representative should notify the ODHS caseworker promptly. Within 60 to 90 days, ODHS will send a letter presenting its recovery claim against the estate.

At that point, the estate has options. If the estate includes a home, the family can:

Sell the home and pay the ODHS claim from the proceeds
Keep the home and pay the claim through other means, such as a mortgage or other borrowing
Request a hardship waiver if the circumstances qualify

ODHS cannot require the family to sell the home. But if the home is the primary estate asset and no other funds are available to satisfy the claim, a sale may be the only practical option.

Planning Options Before Recovery Becomes an Issue

The most effective way to address Oregon Medicaid estate recovery is before someone needs Medicaid — not after. Several planning strategies can reduce or eliminate exposure:

Medicaid Asset Protection Trust (MAPT). A properly structured irrevocable trust established at least five years before applying for Medicaid can protect assets — including a home — from the estate recovery program. After the five-year look-back period has passed, assets transferred into the MAPT are no longer countable for Medicaid eligibility and are protected from recovery after death. As covered in the irrevocable trusts post, timing is critical — this strategy requires planning well in advance.

Caregiver child exception. Oregon law recognizes an exception — confirmed in 2025 legislation — for situations where an adult child lived with the Medicaid recipient in the home and provided care that prevented institutionalization. In those circumstances, ODHS cannot recover against the home. The requirements are specific and must be documented carefully.

Long-term care insurance. Benefits paid under a qualifying long-term care insurance policy are excluded from the recovery calculation under ORS 416.350(5). For families concerned about Medicaid estate recovery, a long-term care policy purchased before care is needed can significantly reduce the amount ODHS can recover.

Spend-down planning. For families who haven't yet applied for Medicaid, a careful spend-down strategy — using assets for legitimate expenses before applying — can reduce the estate subject to recovery. This requires coordination with an elder law attorney to stay within Medicaid's transfer rules and avoid triggering a penalty period under the five-year look-back.

A note on beneficiary designations and POD accounts. Oregon is an expanded recovery state, which means ODHS can pursue recovery from non-probate assets — including accounts with POD designations and assets that pass by beneficiary designation. Unlike in probate-only states, structuring accounts to pass outside of probate does not protect them from Oregon Medicaid estate recovery. The one meaningful exception is life insurance: a life insurance policy with a named beneficiary other than the estate is generally protected from recovery. For everything else, the expanded recovery rules mean that avoiding probate is not the same as avoiding ODHS.

Bottom Line

Oregon Medicaid estate recovery is real, it is broadly defined, and it applies to assets that many families assume are protected. A home held in a living trust, a jointly titled bank account, a life estate — none of these automatically shield assets from Oregon's recovery program.

The time to address this is before care is needed, not after. If you have aging parents, or if you're approaching the years where long-term care becomes a realistic possibility, understanding how Oregon's estate recovery program works is an essential part of your planning.

At Track Town Law, I offer flat-fee estate planning for Oregon and Idaho families. Schedule a consultation here.

This post is for general informational purposes only and does not constitute legal advice. Medicaid estate recovery law is complex and changes frequently. Contact a licensed Oregon elder law attorney to discuss your situation.