As you age, you may find yourself in need of greater assistance. Many in Massachusetts rely on Medicaid for assistance with long-term care in a nursing home or other care facility. However, in order to qualify for Medicaid (MassHealth) assistance, you must meet strict income and asset limits. Applicants for Medicaid are also subject to a look-back period. What is a look-back period and how should it factor into your plans for long-term care?
What is the look-back period?
To qualify for Medicaid (MassHealth), individual applicants cannot have more than $2,000 in countable assets and couples cannot have more than $3,000. However, eligibility for Medicaid is not assessed only based on a person’s assets and income at the time when they apply. The government will also “look back” at the five years before they applied and consider any sales or transactions when determining their financial eligibility.
While some exemptions are available, the government will consider most transactions made during the look-back period. Giving away assets to a loved one or selling them for a low price in an attempt to meet asset or income limits can lead to a penalty period that delays benefits.
For many, the look-back period means that their future Medicaid coverage will depend on the choices that they make in the years before they require care. This may involve careful financial planning, establishing a trust and other steps. Because this process is often complex, aging people may want to seek guidance to protect their access to these important benefits.