There is a penalty against people who transfer assets for less than fair value to qualify for Medicaid if they are receiving or going to receive long term care services such as a nursing home. If you do this, you will not be able to get Medicaid.
The penalty period will not begin until:
- You move to a nursing home;
- You have spent down to the asset limit for Medicaid eligibility;
- You apply for Medicaid coverage; and
- You have been approved for coverage.
Transferring assets will not always trigger the penalty. Here are some examples. There will be no penalty for transfers to:
- A spouse;
- A child who is under 21;
- A child who is blind or has a disability;
- A trust for the benefit of a child who is blind or has a disability; or
- A trust for the sole benefit of a person who has a disability under age 65.