What Every Estate Planning Attorney Needs to Know About Medicaid Planning

Session 7: “Just Say No” and Medicaid Divorce

By: Jason Frank, CELA, CAP, Fellow, and Daniel F. Tavares, Attorney
Moderated by: Camilla O. McRory, Attorney
August 2026

Jason Frank and Daniel Tavares examined two advanced—and potentially risky—strategies for married couples facing nursing-home costs: spousal refusal, sometimes called “Just Say No,” and divorce undertaken in connection with Medicaid planning.

• Maryland Spousal Refusal: although Maryland abolished the civil doctrine of necessaries in Condore v. Prince George’s County, it retains a reciprocal spousal-support duty under Family Law §§ 10-201 and 10-202. COMAR permits eligibility when a community spouse refuses to make resources available, but the institutionalized spouse must generally assign support rights to the State and cooperate with enforcement.
• Significant Refusal Risk: the State’s remedy is based on Maryland’s criminal-nonsupport provisions rather than an ordinary civil collection action. This makes spousal refusal a narrow and potentially unattractive strategy—not the more commonly discussed New York-style planning technique.
• Why Consider Medicaid Divorce: divorce changes the nursing-home spouse from a married applicant, for whom both spouses’ assets generally count, to a single applicant. It may be considered when the relationship is abusive or already ending, assets have always been maintained separately, the couple married later in life, or ordinary Medicaid-planning strategies would produce unfavorable tax or financial consequences.
• Divorce Is Real: the parties must accept all consequences of divorce, including separate representation, loss of joint tax filing, possible revocation of will provisions, changes to retirement and beneficiary rights, and the need to update powers of attorney and other estate-planning documents.
• Unequal Property Division Remains Uncertain: Maryland has historically approved cases in which most or all assets were awarded to the community spouse. However, the panel reviewed a more recent case in which the Department treated a court-approved unequal division as a transfer for less than fair-market value. Although a supervisor later stated that the Department should not have looked behind the divorce order, no definitive appellate ruling resolved the issue.
• Planning and Documentation: attorneys should carefully document the independent reasons for the divorce, consider separating the divorce and Medicaid application by time, evaluate whether assets should be transferred before the divorce, and use a property settlement agreement or QDRO where appropriate. A prenuptial agreement does not protect assets while the couple remains married but may guide or support the property division in a later divorce.
• Capacity, Authority & Ethics: each spouse needs independent counsel, and special care is required when an incapacitated spouse acts through an agent or guardian. Counsel must determine whether the agent has sufficient authority and whether the proposed divorce and property division reflect what the principal would have wanted.

The presentation demonstrated that neither “Just Say No” nor Medicaid divorce is a routine solution. Spousal refusal may expose the community spouse to a criminal-nonsupport proceeding, while Medicaid divorce carries genuine personal and legal consequences and uncertainty regarding unequal property divisions. Both strategies require compelling facts, careful documentation, and a candid discussion of the risks.