Giving During Medicaid’s Lookback Period
Many Westchester County residents apply for Medicaid each year to help them with long-term healthcare, but too many of them make a common mistake before their coverage takes effect. Medicaid has what is known as a ‘lookback’ period, and during that period, one cannot give away or sell any assets if not at market value. If a person does, it can cost them months of healthcare. Still, people may want certain assets to find their way into the hands of loved ones rather than have them be taken by Medicaid. The right attorney can help you look for ways to make that happen without incurring Medicaid-related penalties.
Must ‘Spend Down’ Assets Appropriately
Medicaid is a means-tested program, which means that if an applicant owns more than a certain amount in assets, or has more than a certain level of monthly income, they will be denied – the rationale is, rightly or wrongly, that such a person can afford their own care. The way for a person with more assets to be accepted for Medicaid is to “spend down” those assets – that is, divest themselves of those items until they are no longer countable against them.
Most people hear such a rule and immediately think of giving assets or money to beloved family members – but Medicaid’s requirements forbid asset transfers at less than market value. If a gift at less than market value is made during Medicaid’s lookback period (usually 60 months, or five years), Medicaid will withhold care or deny eligibility for what they believe is an appropriate amount of time. Some may be able to withstand this – but many may not.
Ways To Reward Your Loved Ones
If you are in a position where you need to spend down assets or income in order to qualify for Medicaid, there are many options available to you to help do so. One of the most commonly used, if only one spouse is applying for Medicaid, is known as the Community Spouse Resource Allowance (CSRA). This allows the spouse seeking Medicaid care to transfer assets to their spouse, though there is a monetary limit on doing so (New York’s, as of this writing, is between $74,820 and $162,660 depending on other factors).
Another common way to give to a loved one without incurring Medicaid penalties is known as the child caregiver exception; if one of your children is your primary caregiver and has lived with you for at least two years, you may transfer your home to that child with no penalty. Similarly, if you have a disabled child under the age of 21, you may transfer assets or create a trust for them before they reach their majority without penalty. You need not insist that your family members pay fair market value; these exceptions allow you the autonomy to be generous.
Contact A Pleasantville Asset Protection Attorney
Applying for Medicaid can be an intimidating and confusing experience. A Pleasantville asset protection attorney from Meyer & Spencer, PC can help answer your questions about the process, and ensure that wherever possible, your assets and income are handled in the manner you prefer. We are ready to try and assist you – contact our office today to schedule a consultation.
