(a)
(1) Federal or state benefits in cash or in kind, including, but not limited to, Medicaid, Aid to Families with Dependent Children [abolished], Transitional Employment Assistance Program, Temporary Assistance for Needy Families, and food stamps distributed or paid by the Department of Human Services as well as charges levied by the department for services rendered shall upon the death of the recipient constitute a debt to be paid.
(2)
(A) The department may make a claim against the estate of a deceased recipient or the interest acquired from the deceased recipient by a grantee of a beneficiary deed under § 18-12-608 for the amount of any benefits distributed or paid or charges levied by the department.
(B) If a grantee of a beneficiary deed under § 18-12-608 makes a written request for a release or disclaimer of the department's interest in the real property described in the beneficiary deed, the department within thirty (30) calendar days of the request shall either:
(i) Make a claim against the interest acquired from the deceased recipient by a grantee of the beneficiary deed; or
(ii) Provide the requested disclaimer and a release suitable for recording in the real estate records of the county where the real property is located.
(b)
(1) The department shall not seek recovery against the estate of a deceased recipient or the interest acquired from the deceased recipient by a grantee of a beneficiary deed under § 18-12-608 for the amount of any benefits distributed or paid or charges levied if the recovery is not cost effective or if the recovery works an undue hardship on the heirs or devisees of the decedent's estate or the grantee of a beneficiary deed under § 18-12-608.
(2) In determining the existence of an undue hardship, the department shall consider factors including, but not limited to, the following:
(A) The asset subject to recovery is the sole income-producing asset of the beneficiaries of the estate or the grantee of a beneficiary deed under § 18-12-608;
(B) Without receipt of the beneficiary deed or proceeds of the estate, a grantee or beneficiary would become eligible for federal or state benefits;
(C) Allowing a grantee of a beneficiary deed under § 18-12-608 to receive the interest under the beneficiary deed or a beneficiary to receive the inheritance from the estate would enable the grantee or beneficiary to discontinue eligibility for federal or state benefits;
(D) The asset subject to recovery is a home with a value of fifty percent (50%) or less of the average price of homes in the county where the homestead is located, as of the date of the deceased recipient's death; or
(E) There are other compelling circumstances.
(c) To the extent that there is any conflict between the preceding criteria and the standards that may be specified by the United States Secretary of Health and Human Services, the federal standards shall prevail.
(d) Applicants for federal or state benefits shall be notified in writing in prominent type on the application form that the department may make a claim against their estate or the interest acquired from the applicant by a grantee of a beneficiary deed under § 18-12-608.