In general, Medicaid requires that you need assistance. This means you must not have assets of your own to pay for your medical needs if you are to qualify for Medicaid.
The Affordable Care Act established a new methodology for determining income eligibility for Medicaid, which is based on Modified Adjusted Gross Income (MAGI). MAGI considers taxable income and tax filing relationships to determine financial eligibility for Medicaid.
exceptionSome individuals are exempt from the MAGI-based income counting rules, including those whose eligibility is based on blindness, disability or age (65 and older). Their eligibility is generally determined using the income methodologies of the Supplemental Security Income (SSI) program, which is administered by the Social Security Administration.
Because Medicaid eligibility is based on income as well as age, many older people of means move their assets, often by giving money to family, churches or charities, to reduce their financial standing before they apply for benefits. However, this raises one of the most frequent concerns about Medicaid: the “five-year lookback rule.”
In short, Medicaid looks back at the five years (60 months) prior to your application for benefits to calculate your income and assets. Any assets you have moved will be counted, and could result in a “penalty period” of reduced Medicaid benefits.
But the law provides ways to reduce your penalty period. Our team can guide you through this complex process and find additional benefits to help you during a shortened penalty period.