My mother is in nursing home funded by Medicaid; she has trust agreement for her home, will this property be subject to Medicaid recovery?

Normally trust agreements are created to be civil suit proof; however, you would need to see how the trust is written to so determine.  Further, nothing will prohibit the nursing home from starting a suit; the issue becomes whether it can be successful in its suit. In North Carolina, see the following statutes that may be applicable to your mother's situation: § 36C‑5‑508.  Protective trusts. Except with respect to an interest retained by the settlor, a "protective trust interest" means an interest in a trust in which the terms of the trust provide that the interest terminates or becomes discretionary if: (1)       The beneficiary alienates or attempts to alienate that interest; or (2)       Any creditor attempts to reach the beneficiary's interest by attachment, levy, or otherwise; or (3)       The beneficiary becomes insolvent or bankrupt. (2005‑192, s. 2.) Creditors' Claims; Spendthrift and Discretionary Trusts. § 36C‑5‑501.  Rights of beneficiary's creditor or assignee. (a)       Except as provided in subsection (b) of this section, the court may authorize a creditor or assignee of the beneficiary to reach the beneficiary's interest by attachment of present or future distributions to or for the benefit of the beneficiary or other means. The court may limit the award to that relief as is appropriate under the circumstances. (b)       Subsection (a) of this section shall not apply, and a trustee shall have no liability to any creditor of a beneficiary for any distributions made to or for the benefit of the beneficiary, to the extent that a beneficiary's interest is protected or restricted by any of the following: (1)       A spendthrift provision. (2)       A discretionary trust interest as defined in G.S. 36C‑5‑504(a)(2). (3)       A protective trust interest as described in G.S. 36C‑5‑508. (2005‑192, s. 2; 2007‑106, s. 19   § 36C‑5‑505.  Creditor's claim against settlor. (a)       Subject to the other applicable law, whether or not the terms of a trust contain a spendthrift provision or the interest in the trust is a discretionary trust interest as defined in G.S. 36C‑504(a)(2) or a protective trust interest as defined in G.S. 36C‑5‑508, the following rules apply: (1)       During the lifetime of the settlor, the property of a revocable trust is subject to claims of the settlor's creditors. (2)       With respect to an irrevocable trust, a creditor or assignee of the settlor may reach the maximum amount that can be distributed to or for the settlor's benefit. If a trust has more than one settlor, the amount the creditor or assignee of a particular settlor may reach may not exceed the settlor's interest in the portion of the trust attributable to that settlor's contribution. (2a)     Notwithstanding subdivision (2) of this subsection, the trustee's discretionary authority to pay directly to the taxing authorities or to reimburse the settlor for any tax on trust income or trust principal that is payable by the settlor under the law imposing the tax shall not be considered to be an amount that can be distributed to or for the settlor's benefit, and a creditor or assignee of the settlor shall not be entitled to reach any amount. (3)       After the death of a settlor, and subject to the settlor's right to direct the source from which liabilities will be paid, the property of a trust that was revocable at the settlor's death is subject to claims of the settlor's creditors, costs of administration of the settlor's estate, the expenses of the settlor's funeral and disposal of remains, and statutory allowances to a surviving spouse and children to the extent that the settlor's probate estate is inadequate to satisfy those claims, costs, expenses, and allowances, unless barred by applicable law. (b)       For purposes of this section, with respect to a power of withdrawal over property of a trust exercisable by a holder of the power other than the settlor of the trust, both of the following shall apply: (1)       The property subject to the exercise of the power shall be subject to the claims of the creditors of the holder only when and to the extent that the holder exercises the power. (2)       The lapse, release, or waiver of a power shall not be deemed to be an exercise of the power and shall not cause the holder to be treated as a settlor of the trust. (2005‑192, s. 2; 2007‑106, s. 20.)   A settlor is the person who creates the trust, who is usually the testator (i.e., your mom).