Protecting Your Golden Years

With more than 30 years of experience

How might Medicaid’s “look-back” period impact your plans?

Thinking about old age can be a difficult prospect for many, especially considering the prospect of long-term care. However, even if you are in the peak of health today, it can be important to plan for the possibility of long-term care because of a Medicaid policy called the “look back” period. What is this period, and how might it impact your plans for the future?

Medicaid “looks back” to the time before you apply for benefits.

People hoping to qualify for nursing home assistance from Medicaid must meet strict income and asset requirements. The exact income and asset limits in the state of Georgia depend on an applicant’s marital status and the type of assistance needed. Many may believe that giving away their assets or selling them at a low price before entering a nursing home will allow them to qualify, but this is not the case.

Medicaid “looks back” at the gifts, sales and other asset transfers made in the five years prior to a person’s application for benefits. If they find that a person has given away their possessions or sold them for less than they are worth in an effort to meet Medicaid requirements, that person will face penalties and be ineligible for benefits for some time.

How can people avoid penalties related to the “look-back” period?

For many, maintaining Medicaid eligibility depends on careful planning in the years before they need assistance. Depending on their finances, they may choose to engage in a planned “spend down” by paying off debt, placing funds in trust or other strategies. Because spending down assets to plan for Medicaid is a complex process, many may find it helpful to work with a professional to create a plan that protects both their comfort today and their eligibility tomorrow.