Originally posted on 12/26/2017 and revised 2/1/2022
Did you know that making a gift does not necessarily disqualify you from getting Medicaid for the next five years? Medicaid is a needs-based program, which means that your income and assets must be below a certain level to qualify for the program. If you’ve given away any of your assets within five years of applying for Medicaid, you may have a period of ineligibility that’s based on the value of the gift, but you aren’t automatically disqualified for the full five years.
Medicaid is a needs-based program, which means that your income and assets must be below a certain level to qualify for the program.
Some gifts within that five-year period don’t count, such as gifts to your spouse or to your disabled child, but for any gift within the five-year look-back that you do have to count, you have a period of ineligibility. This means that, even when you have qualified for Medicaid, you have to wait out the ineligibility period before you start receiving your benefits.
For example, let’s say that you gave your children a total of $100,000, and now you need to apply for Medicaid. Your ineligibility period is calculated by dividing the total value of the gift by the daily average statewide private nursing facility rate (the Washington State rate is $355 as of January 1, 2022). This calculation gives you the number of days of ineligibility you’ll have for giving the gift. So, dividing $100,000 by $355 gives you an ineligibility period of 282 days.
Medicaid gifting is a very complex subject and there are a number of potential pitfalls that can occur when you make a gift without planning ahead. If you are concerned about your Medicaid eligibility, you should consult with a Medicaid planning attorney before making any gifts.