New rules crack down on people who give away assets in order to qualify for Medicaid, which will pay nursing home bills. Before Medicaid approves an application, a petitioner’s financial records will be scrutinized to see if any assets were given away or sold to relatives for lowball prices. If so, that applicant can’t go on Medicaid right away.
Formerly, Medicaid could look into transactions that occurred in the previous 36 months. If the applicant was involved with a trust, this “look-back” period was 60 months. Now, everyone must show 60 months’ worth of records.
As long as you comply with the look-back period, no waiting period will be required. That is, your elderly loved ones can give away assets and then apply for Medicaid, 61 months later.
What if they apply before 60 months have lapsed? They will have to wait a certain amount of months, depending on how much they have given away and the average cost of nursing homes in the area.
If someone has given away $100,000 and lives in an area where nursing home fees average $5,000 a month, the waiting period would be 20 months: $100,000 divided by $5,000. This waiting period doesn’t start until the person is already in a nursing home and meets all the requirements for Medicaid eligibility.
