In this Elder Law Minute, Wes Coulson discusses the Medicaid “Look-Back” and “Transfer Penalty” rules.
Today I want to talk about the Medicaid “Look-Back” Period and “Transfer Penalty” rules, the very scary thing for most people who are applying for Medicaid with very good reason, as it turns out. So, what’s this look-back rule? Well, what it refers to is a question on the Medicaid application that asks whether you have given away or transferred any assets for less than fair market value within five years prior to the date of application. So that five years before application, that’s the look-back period.
If the answer to that question is yes, then unless you have fixed it before you apply (come see us), you will face what’s known as a transfer penalty. A transfer penalty is a temporary delay in eligibility starting from the time of application. How long that delay in eligibility is depends on which state you’re in. If you’re in Missouri, Missouri has a state-wide penalty divisor, which right now is $6,463 a month for 2020. If you’re hearing this later, it will change over time. In Illinois, they use the private pay room rate for a semi-private room for thirty days in the facility in which you’re situated. As example to show that can vary quite a bit, if you’re in a nursing home that costs $160 a day, that nursing home transfer penalty divisor is $4800 a month. If you’re in a nursing home that costs $250 a day, it’s $7500 a month. In Illinois, it’s not a state-wide thing. It’s a function of the nursing home that you’re in.
Back to the see us thing, if you’re facing any of those transfer penalties you need to either:
- See if there is a way to get rid of them before you apply or
- Make sure you can pay for the nursing home care during the penalty period
Those are at the heart of the planning we do to help people.
Also looking for information about Medicaid and Asset Preservation? Visit these articles:
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Coulson Elder Law is dedicated to providing families in the St. Louis area with their Elder Law needs. Our practice areas include Asset Preservation Planning, Veterans Benefits, Medicaid Eligibility, Alzheimer’s Planning, Special Needs Planning, Estate Planning and more. We understand the financial challenges you may face as you and your loved ones grow older. At Coulson Elder Law, our clients’ well-being is our number one priority. For immediate help, call (618) 632-7000 (IL) or (314) 567-9292 (MO), or Contact Us and we will get in touch as soon as possible.