If you've ever sat around the kitchen table worried about what happens to your home or savings if a parent needs nursing home care, you're not alone. For middle-income families in Brooklyn, Queens, and Staten Island, this conversation comes up more often than people expect — and usually when there's already a health crisis looming.
The good news is that Medicaid planning doesn't have to mean giving everything away or hoping for the best. With the right approach, you can protect a significant portion of what you've built. But the rules are detailed, the deadlines are unforgiving, and the stakes are real. Here's what you actually need to think about.
Know the income and asset limits — they're tighter than you'd expect
Medicaid eligibility for long-term care in New York is based on both income and assets, and the thresholds are updated each year. As of 2026, a single individual applying for nursing home Medicaid must have monthly income under $1,836 and countable assets under $33,038. For a married couple, the combined asset limit rises to $44,796.
Those numbers catch a lot of families off guard. A modest savings account, a small investment portfolio, or even a car (depending on how it's titled) can all count against you. Knowing which assets are "countable" versus "exempt" is step one.
Exempt assets generally include your primary residence (up to a home equity limit of $1,130,000 in New York for 2026), one vehicle, personal belongings, and prepaid funeral arrangements. Everything else — bank accounts, stocks, second properties — counts toward the limit.
The 5-year lookback period changes everything about timing
This is where a lot of families get into trouble. Medicaid doesn't just look at what you own today — it reviews every financial transaction you made in the 60 months before you apply. Gifts to children, assets transferred to a trust, property sold below market value — all of it gets scrutinized.
If Medicaid finds a transfer it considers improper, it calculates a penalty period: months during which you're ineligible for benefits even if you otherwise qualify. The length of that penalty depends on how much was transferred and the average monthly nursing home cost in your area.
The practical implication? If you're thinking about protecting your home or setting money aside for your kids, you need to start planning well before any care need arises — ideally five or more years in advance. Waiting until a hospitalization or diagnosis dramatically narrows your options.
Spend-down isn't your only path — and it shouldn't be your default
Many families assume they have no choice but to exhaust their savings before Medicaid kicks in. That's not accurate, and it's an expensive misconception. Legitimate spend-down strategies exist, but so do asset protection strategies that preserve far more.
Medicaid Asset Protection Trusts (MAPTs) are the most widely used tool. You transfer assets — often your home — into an irrevocable trust managed by a trustee (typically an adult child). Once outside the lookback window, those assets don't count toward Medicaid's limits, and they're shielded from estate recovery after your death. The trade-off is real: the trust is irrevocable, meaning you can't pull those assets back. But for many families, that's a worthwhile exchange for preserving a home worth hundreds of thousands of dollars.
For applicants with excess monthly income, a pooled income trust allows surplus funds to be directed to a nonprofit-managed account for qualified living expenses — keeping monthly income within Medicaid's thresholds without losing access to those funds.
If one spouse needs care while the other remains at home, New York's spousal protections are generous. The community spouse can keep up to $74,820 in assets (2026 figure varies by circumstance), and may receive a monthly income allowance to maintain their standard of living. New York also allows "spousal refusal" in certain cases, which can protect even more.
You can learn more about spend-down strategies and how they interact with long-term care Medicaid in the Alatsas Law Firm's resource library.
Estate recovery: what happens after you're gone
This part surprises a lot of people. Even if Medicaid covers your care, New York State can file a claim against your estate after you die to recover what it paid. Under New York law, the state is limited to recovering from your probate estate — assets held solely in your name at death.
This means assets held in a properly structured MAPT, joint tenancy accounts with right of survivorship, or accounts with a designated beneficiary generally fall outside that recovery reach. But assets titled only in your name — including a home you never transferred — are fair game.
Recovery is deferred while a surviving spouse is alive, or if there's a minor or disabled child. Still, for families counting on passing their home to the next generation, understanding estate recovery is non-negotiable. Alatsas Law Firm has written directly about how New York's Medicaid estate recovery rules affect local families — it's worth reading if your home is your biggest asset.
Don't overlook the human side of this planning
Beyond the legal mechanics, Medicaid planning forces families to have honest conversations about aging, health, and money. Who will make decisions if a parent can't? What does a dignified care arrangement actually look like? What's the family's real financial picture?
These conversations are uncomfortable, but they're also the ones that prevent crises. Families who plan ahead have options. Families who wait until there's a diagnosis or an emergency often find that the best strategies are no longer available to them.
That's been the consistent experience of attorney Ted Alatsas and the team at Alatsas Law Firm, who have been helping Brooklyn, Queens, and Staten Island families navigate Medicaid planning since 1996. Their approach — rooted in the community, attentive to each family's specific circumstances — reflects the reality that Medicaid planning isn't just a legal exercise. It's about protecting people.
If you're starting to think about these questions, the right time to act is before a crisis forces your hand. A consultation with an experienced elder law attorney is the clearest first step you can take.
