The Medicaid look-back period is perhaps one of the most complex aspect about Medicaid. Many of our clients are often confused about when and how the look-back period applies. Because this concept and Medicaid alltogether is extremely complex, please note that this article does not cover everything you should know about the look-back period.

Know the Asset/Income limits for 2020

First, in order to be eligible for Medicaid, you cannot have assets greater than the limit. This is true whether you are applying for long-term care through Medicaid – either in your home, a nursing home, or an assisted living facility.

The asset/income limits vary by state and by your marital status. For a complete breakdown of the limits in Illinois, read my previous post by clicking HERE.

Illinois’s Assets/Income Limits summarized

  • single persons – the income limit is $1,063.00 per month and the asset limit is $2,000.00;
  • if you’re married with one spouse applying – the income limit is $1,063.00 per month and the asset limit varies depending on the type of Medicaid you are applying for; and/or
  • if married and both spouses apply – the income limit is $1,437 per month and the asset limit is $3,000.00.

What is the purpose of the Medicaid look-back period?

According to the American Council on Aging, Medicaid’s look-back period was crafted as a way to prevent Medicaid applicants from giving away assets or selling them under fair market value in an attempt to meet Medicaid’s asset limit.

When does Medicaid Look-Back period run?

Your Medicaid look-back period will begin on the date of your Medicaid application and will cover the previous 60 months. For Illinois, and every state (except California), the look-back period is 60 months. California’s look-back period is only 30 months. So, if you are not a resident of California and you apply for Medicaid on January 1, 2020 then your look-back period will extend back to December 31, 2015.

What happens during the Look-Back period?

During your entire look-back period, all of your financial transactions dating back five years (60 months) will be reviewed. Again, the Medicaid rules are complex. However, generally speaking, the rules prohibit you and your spouse from giving away assets during the period AND/OR selling assets (such as a car or boat) for under fair market value (“FMV”). Click HERE if you need a better understanding on FMV.

Are you (or your parents) applying for Medicaid?

I always reccomend consulting with a professional before applying for Medicaid. Be sure to do your research and ask tough questions before hiring someone. Our office is happy to help you move forward with Medicaid Planning. Simply click HERE to contact our firm to schedule a free consultation.