Mother died 10-16, stepfather died 10-15, will state file MERP claim on their property?

You need a really good probate atty and maybe one that specializes in real estate probate issues if you want to have any degree of getting any of the assets of their estates. Whatever is done is going to be complex.

So who is the executor for you mom's 2nd husband current probate? They will need to be on the same page as you in all this to make things work easily. If it's his kids from earlier marriage, they may not be interested. You can pretty easily find out what's happening with his probate by getting a docket report & maybe downloading anything filed as probate is open records court, I think in all states. Actually I'd suggest you do this first, get docket info and request copies of … the will, the assets of the estate list and if there is a claim against the estate list on file then that too.

If stepdad was on Medicaid and his family opened probate, MERP should have made a determination if it was going to file a claim in probate or not by now.

If only mom was on Medicaid and she has assets, you need to discuss with your atty whether there is likely to be a claim filed or if MERP can try to attach his assets.

The "deed" so was it actually filed at the courthouse, so that the ownership names on her property was changed to read her name and all of the kids names? And this change shows up year after year on tax assessor records and any other property ownership records? If it wasn't actually changed and recorded, you are probably out of luck. If it was and it shows each of you all as owners, mom's share of the property is an asset of her estate and MERP can attempt recovery of $ paid for her care from that asset. If you do probate, then how that can be done is interdependent on probate rules. If you do nothing, MERP will more than likely place a claim or a lien on the property for whatever amount MERP is "owed". To later on sell or transfer the property, it's going to need an atty to get this cleared. Your best off dealing with all this now via probate for mom's estate and being working friendly with the executor of step dads estate. If you can be friendly, maybe speak with their probate guy as a first step. They will have names of others for you if need be. It's not a Legal Aid type of work, imo. Allow for maybe 6K for retainer.

Sorry for lack of info: When my biological father died in 1978, thru probate, Mom got half of real property and we kids got other half. Mom's will dated 1981 states that upon her death, we get her half. Her second husband died in 2015 and left a Will which is in probate now, but Mom has been left out because his real property was his before marriage. So, Mom applied for Medicaid during her marriage to 2nd husband and now after her death Medicaid filed claim. Per Legal Aid atty, Medicaid cannot take property because we kids are in deed and per Will her interest goes to us. Do you agree?

There is not enough detail here to give you a clear answer. You don't say how long they were married. You say assets were divided, but how? With a promise? With a Life Estate document? With a Trust? A Will? You don't say which one was on Medicaid? So I will guess.
He dies first. Usually the wife gets everything. But the wife is on Medicaid, then she dies, so MERP gets everything, even if her Will says divide it. Heirs only get what is left after all claims are paid.

will we need stepfather's Will also? His probate case is pending; can MERP file against his case because they were married even though he died first?

You will need a lawyer and the Wills to sort this out. If they were on Medicaid, yes the Medicaid Estate Recovery Program will have a lien on the estate.
Even if mom named you in a Will, the bills are all paid before anything is distributed.