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Ohio Department of Aging Aging Connection - December 2009

December 2009

Medicaid Look-Back Period

Transferring money and property to trusts or other family members in order to reduce individual assets and qualify for Medicaid has long been an estate planning practice. The goal is to make the money last as long as the care is needed, if possible, without totally impoverishing the person. Hiding assets in order to qualify for Medicaid is a crime, but it is not illegal to structure assets in an effort to qualify for Medicaid nursing home benefits.

Medicaid Look-Back Period

To qualify for Medicaid nursing home coverage, an individual must have very low income and assets. In order to prevent fraud, states conduct a review, or "look-back," when an individual applies for Medicaid coverage for long-term care. The look-back determines whether, within the last 60 months, the individual or a spouse transferred assets, such as cash gifts or ownership of the home, to another person for less than fair market value. An asset transfer within the look-back period will be questioned and, if something of equal value was not received in return, a penalty will be applied, which will prevent the person from receiving Medicaid long-term care benefits until that penalty period expires.

Elder law attorneys advise their clients on Medicaid law and what can and cannot be done legally to protect their assets. An attorney who practices elder law or estate planning law can provide invaluable assistance in considering and preparing for all possible scenarios. An attorney will be able to answer several important questions:

  • What is the maximum amount of assets that a person can retain in Ohio and still qualify for Medicaid?
  • How does Ohio define assets?
  • Are any of the transfers of property exempt?
  • How do transfers of property between spouses affect eligibility?
  • Are there any criminal penalties if a person transfers assets in order to qualify?
  • What is the "ineligibility period" in each individual's case?
  • What data are used to determine the ineligibility period?
  • How can a person challenge the Medicaid-calculated ineligibility period?
  • If a person is eligible, how can he or she begin receiving benefits?

Consumers can make costly mistakes if they do not know all the facts and ramifications. Professional help may be expensive, but mistakes cost more.

Asset re-allocation is part of an overall estate and long-term care planning process. Ohioans can visit www.longtermcare.gov to learn more about long-term care planning and the options. Also at that site, consumers can download or order the free "Own Your Future" planning kit.

Some of Ohio long-term care insurance companies offer policies that qualify under the state's Long-term Care Partnership Insurance Program. Partnership insurance offers a way for people to buy long-term care insurance, receive policy benefits and protect a matching amount of assets if they need to apply for Medicaid. For more information, visit www.ltc4me.ohio.gov or contact 1-800-686-1578. Information also is available from area agencies on aging or county departments of job and family services.