What Is The Period of Medicaid Ineligibility and When Does It Begin?
Understanding Medicaid’s look-back period and the associated penalties
Many people who need long-term care are also reliant on Medicaid to help cover the costs of their long-term care facility. This is because Medicare and most private insurance companies do not cover long-term care, but Medicaid does. Many seniors do not have an issue with Medicaid’s income eligibility guidelines, but they may have an issue with having assets that exceed the state’s Medicaid eligibility limits. When this happens, the Medicaid applicant needs to be careful about how they choose to “spend down” their assets to ensure they are protected from Medicaid’s ineligibility period.
What is a Medicaid ineligibility period?
The Medicaid ineligibility period is a period in which the Medicaid applicant is ineligible to receive benefits as a penalty for transferring or gifting away assets within Medicaid’s five-year look-back period. This Medicaid ineligibility period exists to discourage applicant’s from transferring or giving away assets for no reason other than to avoid using those assets to pay for long-term care. The Medicaid ineligibility period penalty is calculated in a period of months in which the Medicaid applicant, or their family, will be responsible for covering their costs of long-term care before Medicaid benefits begin.
What to know when calculating a Medicaid ineligibility period
The Medicaid ineligibility period is calculated as a penalty which applies for a certain number of months based on the value of countable assets that were transferred or given away during the Medicaid five-year look-back period and the average monthly cost of a nursing home in your area. In Kansas, the figure used for the average cost of a nursing home in 2019 is $207.70 per day. Here is an example of how to calculate the Medicaid ineligibility period penalty:
- The Medicaid applicant transferred their home into the name of their daughter 3 years ago
- The value of the Medicaid applicant’s home is $250,000
- The value of the transferred asset is divided by the ineligibility divisor factor of $207.70 / day
- The ineligibility period for this transfer would be just over 40 months
It is important to note that the date of the Medicaid ineligibility period begins on the day the Medicaid applicant would be eligible to begin receiving Medicaid benefits, not on the date the assets were transferred or given away.
Kansas Medicaid planning lawyers guide individuals and families through the complicated Medicaid planning process to protect them from Medicaid’s look-back period
Families should begin planning for Medicaid well before they expect to need it. The compassionate Kansas Medicaid planning attorneys at Stockton & Stern, LLC. have the experience necessary to help you navigate the complex Medicaid planning process. Our lawyers are knowledgeable in all Medicaid and estate planning laws and help you avoid issues related to the Medicaid look-back period. To schedule an appointment, call us at 913-856-2828 or contact us online today. Our convenient office locations include Gardner and Overland Park, and we are available to meet you at your home if needed.