In this fourth of a six part series on the Medicaid Look-Back Rule and Transfer Penalties, Wes Coulson discusses the Look-Back rule and how the delay in eligibility is determined when gifts are made.
Look-Back Rule and Delay in Eligibility
Hi, I’m Wes Coulson and this your elder law minute. This is the fourth in our six part series on the Medicaid Look-back rules and Transfer penalties.
One of the questions we get is, “if somebody has made gifts, how long does that delay their eligibility for Medicaid?” The common misconception is that it delays eligibility for five years, that’s not at all the case. It’s done by a math formula. Basically, what they’re going to do is add up all the gifts made within five years, and divide that by what is known as a penalty divisor. In Illinois, it’s the actual cost of the nursing home that the person is in when they apply. In Missouri, as of right now, that penalty divisor is statewide at $4,744 a month. For Example, in Illinois, someone in a nursing home that costs $5,000 a month, and they’ve given away $50,000, that’s going to be a ten month penalty. Thanks.
For the complete Medicaid Look Back Rule and Transfer Penalties series, visit these articles:
- Will routine gifts cause a Medicaid Transfer Penalty?
- Withdrawals from Joint Accounts: Are they subject to transfer penalties?
- Will transferring assets between spouses cause a Medicaid Transfer Penalty?
- Gifts and the Five-Year Look Back
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