Choices for Care — Giving Away Property or Resources

If you have too many assets or too much property, you should talk to a lawyer familiar with Medicaid law.

Asset management issues are complicated. The information below is intended to help you have a general understanding, but you should have expert help with any decisions you make about your assets or property.

Giving away assets or property, including your home, within five years of applying for Choices for Care (CFC), may mean that you will not qualify for long-term care services for a period of time.

How much time depends on how much property you gave away (transferred). The penalty is based on the value of the asset or property you gave away, divided by the daily nursing facility rate ($377.04 per day). The penalty period begins on the day you become eligible for CFC.

Note: The transfer penalty only applies to long-term care. Payments are made for all other covered Medicaid services during the penalty period.

Transferring your home

In some circumstances, transfer of your home is allowable.

You can transfer an interest in your home to a sibling, if your sibling already has an equity interest in the home and has been living in the home for at least one year before you became eligible for long-term care.

You can also transfer your home to a child if he or she was living in your home for at least two years immediately before you became eligible for long-term care and provided care to you which permitted you to stay at home.

It is also possible to have your home transferred automatically upon death. This is done by creating a life interest in the home, keeping the right to sell it during your lifetime, and giving a child, sibling or someone else a future interest in it as your survivor.

This lets you continue to live in and own the home, sell it later if you want, and say who you want to get it when you die. In order to create or change an interest in your home, you need to have an attorney prepare a new deed.

Exceptions

Certain transfers are exempt from penalty. You can transfer property to your spouse without risk of a Medicaid penalty. You can also transfer property to a child if the child is under 21 years of age or is blind or disabled.

CFC will not impose a transfer penalty if the resources were transferred exclusively for a purpose other than to become or remain eligible for long-term care or if the penalty will result in "undue hardship."

A transfer "for another purpose" is when the transfer was not within the individual's control, when court ordered, or when the need for long-term care was not anticipated on the date of transfer (e.g., the individual became disabled due to an accident or was diagnosed with a disabling condition after the date of transfer).

A transfer penalty will result in "undue hardship" when a power of attorney or guardian transferred the resource and was not acting in your best interest; or when you were defrauded or misled into giving away a resource; or when you cannot get the transferred resource back because it is lost, destroyed, stolen, or otherwise unavailable.

The figures on this page have been updated for 2024.