📍 Understanding the 5-Year Lookback and How to Protect Your Assets
When planning for long-term care in New York, many Brooklyn families discover a harsh reality: Medicaid doesn’t just look at what you own today. It also reviews what you gave away in the last five years.
This lookback is more than just a formality—it’s a legal requirement that could delay your eligibility and cost your family thousands if not properly addressed.
At Alatsas Law Firm, we help families protect their assets while remaining Medicaid-eligible, even after transfers have occurred. In this article, we break down what qualifies as a Medicaid transfer penalty in New York and how you can plan around it.
🔍 What Is the Medicaid Lookback Period?
New York State Medicaid has a 60-month (5-year) lookback period for institutional (nursing home) Medicaid eligibility. Learn more about the lookback period>>
This means:
Any assets you gave away or transferred for less than fair market value within the last five years could trigger a transfer penalty—a delay in when Medicaid will begin to pay for your care.
🧠 Important: The lookback does not apply to Community Medicaid (home care services) in 2025, though changes are expected. Always consult a Medicaid planning attorney to stay ahead of law changes.
🚫 What Triggers a Medicaid Transfer Penalty?
Transfers that may trigger a penalty include:
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Gifting money to children or grandchildren
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Transferring a home into a relative’s name
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Selling property below market value
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Forgiving a debt owed to you
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Transferring investment accounts or assets into another person’s name without compensation
Even routine family support—like paying rent for a grandchild or funding a wedding—can be viewed as a disqualifying transfer.
🧮 How is the Medicaid Penalty Calculated?
The penalty period is based on the total value of the transferred assets divided by the regional monthly nursing home rate set by the New York Department of Health.
For 2025, in New York City, the rate is $14,136/month (subject to annual updates).
Example:
If you gave your daughter $141,360 within the lookback window:
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$141,360 ÷ $14,136 = 10-month penalty
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You will be ineligible for Medicaid nursing home coverage for 10 months from the date you otherwise qualify.
🛡️ Transfers That Are Exempt from Penalties
Some transfers are allowed under Medicaid rules without triggering a penalty:
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To a spouse (or for the benefit of a spouse)
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To a disabled or blind child
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To a caretaker child (a child who lived with you and provided care for at least two years before nursing home entry)
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To a sibling with an equity interest in the home who lived there for at least one year
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To a special needs trust for a disabled individual under 65
🔗 Learn more about exempt transfers for Medicaid in New York »
📁 Documenting Fair Market Transactions
If you sold something—like your car or condo—during the lookback period, it’s essential to:
✅ Retain documentation (sale agreement, check copy, appraisal)
✅ Prove the transaction was at fair market value
✅ Provide full paper trails (no cash-only sales)
Without sufficient documentation, Medicaid may treat it as a gift, triggering a penalty.
💡 Can I Undo a Disqualifying Transfer?
Yes, but it must be done properly.
If you reverse the gift—meaning the asset is returned in full—the transfer can be canceled and the penalty voided. However:
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You must prove the asset was returned
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You may need to reapply for Medicaid
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Timing is critical
This is known as "cure of transfer", and it’s best done with the guidance of a Medicaid attorney.
⚖️ How Alatsas Law Firm Helps Brooklyn Families Navigate the Transfer Rules
Our experienced elder law team will:
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Analyze your past transfers
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Identify exempt vs. non-exempt gifts
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Prepare Medicaid penalty mitigation strategies
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Set up protective trusts like Medicaid Asset Protection Trusts (MAPTs)
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Help you qualify while keeping your home and savings protected
🔗 Explore our Medicaid planning services in Brooklyn »
🔚 Plan Ahead to Protect Your Care Options
A single transfer—made with good intentions—can create big problems if not handled properly.
With the right legal guidance, you can:
✅ Avoid costly penalties
✅ Protect your legacy
✅ Get the care you need when you need it
📞 Call (718) 233-2903 or
📅 Schedule your Medicaid strategy session with Alatsas Law Firm today »
