As a person ages, they are likely going to accumulate assets. This is usually a good thing; however, if the person is going to need Medicaid to help pay for some of their expenses, it might not be such a good thing. Some individuals don’t understand that they can’t just give things away right before they need Medicaid. Since New York has a look-back period for Medicaid that spans five years, proper Medicaid planning is critically important.
In this state, the look-back period only applies to Institutional Medicaid, which means that it only occurs if the person needs to go into a nursing home or similar facility. If the only thing that is needed is Medicaid for other care, there isn’t a look-back period.
When using the look-back period in connection with the Institutional Medicaid application, the agency is looking for gifts that were given away and certain other “valuable” transactions. If there are any, the person would be disqualified for Medicaid for a specific amount of time. This is equal to the number of months of nursing home care the transaction or gift could have covered. The average cost in the person’s location is used.
For example, if the average monthly cost of nursing home care is $12,157, a person who gave away property with a value of $121,570, that person is disqualified for 10 months. During the ineligibility time, the person has to pay for care.
Medicaid planning is a proactive way that people who may need Medicaid can work their assets so they can retain eligibility. Consulting with a professional experienced in this matter is imperative, so you can set everything up in an appropriate manner.
Written by Ronald A. Fatoullah, Esq, principal of Ronald Fatoullah & Associates, a New York law firm that concentrates in elder law, estate planning, Medicaid planning, guardianships, estate administration, trusts, wills, and real estate. Attorney Fatoullah is a Member of the National ElderCare Matters Alliance, and he and his firm are Featured Members of ElderCareMatters.com – America’s National Directory of Elder Care / Senior Care Resources for families.