The Commissioner of Administrative Services may accept mortgage notes and mortgage deeds in payment of claims due for (1) institutional care, and (2) to the extent required under federal law, medical assistance. The commissioner may accept such mortgage notes and mortgage deeds on such terms and conditions as the commissioner deems proper and reasonable, and such encumbrances may be foreclosed in an action brought in a court of competent jurisdiction by the commissioner on behalf of the state. Any such encumbrance shall be released by the commissioner upon payment of the amount by it secured.
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