How Can an Estate Planning Attorney Help With Medicaid?

Long-term care is one of the largest financial risks most families face. Nursing home care can use up savings built over a lifetime, and Medicare covers only limited short-term skilled care. Medicaid is the main public program that pays for long-term care, but it has strict financial eligibility rules. Medicaid planning is the legal work of arranging your affairs so you can qualify when you need care, while protecting as much as the law allows for your spouse and family.

Why Medicaid Planning Matters in New York

New York Medicaid eligibility is governed by state law (Social Services Law § 366) and federal law (42 U.S.C. § 1396p). Applicants must fall within resource and income limits that change every year, so confirm the current figures before you make decisions. Some assets are exempt, such as a primary home in many situations, while savings and investment accounts usually count.

The Look-Back Period

When you apply for nursing home (chronic care) Medicaid, the agency reviews your financial records for the 60 months before the application. Gifts or transfers for less than fair value during that window create a penalty period, during which Medicaid will not pay for your care.

New York has also enacted a look-back for community (home care) Medicaid, but its start has been delayed repeatedly. Check the current rules before relying on any assumption about home care.

Common Planning Tools

• Medicaid asset protection trust: an irrevocable trust, usually income-only, that holds assets such as a home or investments. Once the look-back period has passed, trust assets generally are not counted.
• Exempt transfers: some transfers do not trigger a penalty, including transfers to a spouse, to a child who is blind or disabled, and of a home to a caregiver child who lived there and provided care for the required period (42 U.S.C. § 1396p(c)(2)).
• Pooled supplemental needs trusts: trusts run by nonprofit organizations that can hold excess income or assets for a person with a disability, often used by people seeking home care.
• A careful application: a complete, well-documented application avoids delays and denials.

Protecting a Spouse at Home

Medicaid law protects the community spouse, meaning the spouse who stays at home, by letting that spouse keep a share of the couple’s resources and income. New York has long permitted spousal refusal, in which the community spouse declines to make their own resources available, but the county may then seek support from that spouse. Confirm the current rules before relying on it.

Estate Recovery

After a Medicaid recipient dies, Medicaid can seek repayment of certain benefits from the recipient’s estate. What is exposed depends on how assets are held at death, which is another reason to plan before a crisis.

Start Before a Crisis

Because of the 60-month look-back, the best time to plan is years before care is needed, ideally as part of your regular estate plan. Even in a crisis, options often remain, including exempt transfers, spousal protections, and pooled trusts. Do not give away assets on your own before getting advice, because a poorly timed gift can create exactly the penalty you are trying to avoid.

How Seraj Law Can Help

We build Medicaid and long-term care planning into your overall estate plan, including trusts designed for asset protection. Contact us to review your options while you still have the most of them.