Nursing home Medicaid is a program funded by the Federal government and administered by the Georgia Department of Community Health that provides coverage for nursing home stays for individuals who have a medical need for such care. In addition to showing a need for nursing home care, an applicant for nursing home Medicaid must also show that they meet financial requirements for nursing home Medicaid by satisfying both an asset test and an income test. More information on the financial requirements for Medicaid can be found on the Medicaid planning section of this website.
There are many planning techniques that can be used to qualify someone with excess assets for nursing home Medicaid. Usually these techniques involve making gifts to trusted friends or family members to get the assets out of the name of the individual applying for Medicaid. Care must be taken in making transfers to qualify for Medicaid because most transfers made within a year of applying for Medicaid will cause a penalty period. The penalty period is an amount of time during which the Medicaid applicant is ineligible to receive nursing home Medicaid. The number of months of the penalty period is based upon the amount of money that was given away.
There are situations in which money can be transferred out of the name of a spouse of a Medicaid applicant and not create a penalty period. One of the methods by which assets can be transferred without a penalty period is when a spouse leaves assets to their spouse in a special needs trust created by will. In this scenario, the assets are left to be administered by a designated trustee for the benefit of the spouse. The assets placed into trust do not count against Medicaid and cannot be claimed in a Medicaid payback. As such strategy is only one of several planning techniques for excess assets and the execution of Medicaid planning techniques requires precision, it is advisable to seek the services of an experienced elder law attorney before engaging in such planning.