 TITLE: What Happens to Medical Debt When You Die? CONTENT: Who Is Responsible for Someone's Medical Debt When They Die?\n------------------------------------------------------------\nYour medical bills don't go away when you die, but that doesn't mean your survivors have to pay them. Instead, medical debt—like all debt remaining after you die—is paid by your estate.\nEstate is just a fancy way to say the total of all the assets you owned at death. When you die, the money in your estate will be used to cover your outstanding debts. If you had a will and named an executor, that person uses the money from your estate to pay your outstanding debts. If you didn't have a will, a judge will select an administrator to carry out the judge's decisions about how to distribute your estate.\nDebts must be paid before your heirs receive any money from your estate. If the value of your estate is equal to or more than the amount of your debt, your estate is _solvent_—that is, it can afford to pay the debt.\nIf you have more debt than assets, your estate is considered _insolvent_. In this situation, things get a bit more complicated. When you have more debt than your estate can cover, the court will prioritize payments to creditors according to federal and state laws. Some creditors may get the full amount they are owed; others may get partial payments or nothing at all. Your estate may have to sell some assets, such as your home or car, to pay the debts.\nIf you die with $100,000 in medical debt but have only $50,000 in assets, is your family responsible for paying the remaining $50,000? In most cases, no. If the estate can't pay your medical debt, the creditors generally write it off. However, there are some exceptions to this rule.\n*   **Cosigned medical bills**: When you seek medical treatment, you're generally required to sign paperwork promising to take responsibility for any bills your insurance doesn't pay. If someone else signed these papers for you, they could be held responsible for your medical bills. This varies depending on state laws and the specifics of the documents.\n*   **Filial responsibility laws**: More than half of states have laws that hold adult children responsible for financially supporting their parents if the parents can't afford to support themselves. These laws are rarely enforced, because Medicaid typically pays for medical care in these cases. However, Medicaid might pursue your estate to recover benefits (more on this below).\n*   **Medicaid estate recovery**: If you are a Medicaid recipient over age 55 when you die, federal law requires your state's Medicaid program to try to recover from your estate all the payments they made for your nursing facility services, home and community-based services, and related hospital and prescription drug services. Medicaid won't hold your survivors responsible for the repayments; any recovery will be made from your estate. If you are survived by a spouse, a child under age 21 or a blind or disabled child of any age, Medicaid can't pursue the repayments at all.\n*   **Community property states**: The nine community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. (Alaska gives both spouses the option to make their property community.) In community property states, spouses are generally held responsible for each other's debts, even if they did not incur the debts themselves. However, community property laws vary from one community property state to another, so you should speak to an attorney to determine responsibility for medical bills. END