The earliest date that the State will begin implementation of a 30-month lookback for home care is April 2024.
New York does not currently have a lookback period for Medicaid applicants applying for home and community-based services, including personal care and Medicaid waiver programs. Meaning that if you move money out of your name this month, you can be eligible to apply for Medicaid the following month without paying a penalty for any non-exempt asset transfers.
This is set to change in the future. New York State intends to implement a 30-month lookback for Medicaid applicants seeking community-based long-term care services. The new rule was passed in the April 2020 budget. Implementation has been delayed several times due to protections enacted under Maintenance of Effort requirements under Section 6008(b)(1) of the Families First Coronavirus Response Act (FFCRA).
The transfer penalty applies to both income and assets. So, at this time, New Yorkers are not required to prove that the individual is receiving fair-market value for transfers to a pooled trust for home care eligibility. However, transfers could be subject to a penalty in the future if a person applies for Medicaid nursing home care within 5 years of the transfer.
What if I go into a nursing home?
If a trust beneficiary goes into a nursing home permanently, you will no longer make deposits to the pooled trust. Most of your monthly income will now go to the nursing home to pay for the cost of your care.
If you are in the nursing home for a short-term stay and intend to return home, you can continue to deposit your excess income into the pooled trust. This allows you to pay your living expenses so that you have a home to return to when you are ready to go back into the community.
While the goal is always to help people live at home for as long as possible, there are times where a person’s needs progress and they may be better served in a skilled-nursing or long-term care facility. At this time, there should not be a large balance in the trust as long as the beneficiary is regularly using the trust funds to pay bills. Transfers to a pooled trust after a person is 65 are subject to review when a person applies for Medicaid to pay for nursing home care.
What happens to the money in my trust account?
Money in the trust that has been spent by the non-profit for the benefit of the Medicaid applicant is typically disregarded as the individual has received fair-market value in exchange for the assets transferred. The Medicaid applicant is responsible for providing proof of the amounts the pooled trust paid for expenses to meet their needs during this time. This could include copies of bank statements detailing account activity, as well as associated documentation for specific trust transactions. The trust or trustee should maintain detailed records to assist beneficiaries through this transition.
The remaining principal balance in the trust is uncompensated, making it an available resource that may be subject to a transfer penalty depending on what other resources the beneficiary has outside the pooled trust. In 2022, a single individual can have up to $16,800 in assets and spousal budgeting in New York can allow a married couple to keep a minimum of $74,820 in assets. Therefore, we rarely see transfer penalties imposed due to unspent funds in a pooled trust unless there is a significant balance. If a penalty is imposed, the available balance in your trust account can be used to help pay for services during the penalty period.
For questions about asset transfer penalties, please consult a legal professional or contact your local Medicaid office/Department of Social Services (DSS). For residents of NYC, contact the Human Resources Administration (HRA).