In general, but subject to some exceptions, if you or your spouse make a transfer of property for less than fair market value in the five years prior to your application for Medical Assistance ("MA") (known as the “look back period”), you will likely be found ineligible for MA for long-term care services for at least some period of time.[i] The length of the ineligibility period in months is determined by dividing the total uncompensated value of the transferred property by the average MA rate for nursing facility services in the state in effect on the date of application for MA.[ii]
"If you make a transfer of property for less than fair market value five years prior to your Medical Assistance application, you will likely to be determined to be ineligible"
Transfers of property in conjunction with MA for long-term care are tricky to consider. The only way to know that a transfer will not affect your eligibility for MA for long-term care services is to give away or sell an asset for less than fair market value, and then be sure to not apply for MA in the following five years.[iii] But, of course, no one has any way of knowing when they may be required to apply for MA in order to move into a long-term care facility. Regardless of our age and current health condition, we don’t know what tomorrow holds.
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[i] Minn. Stat. § 256B.0595, subd. 1(a); “The Perilous Path to Long-Term Care: It’s Not Really about Asset Protection,” Bench & Bar Minnesota, June 5, 2013, http://mnbenchbar.com/2013/06/the-perilous-path-to-long-term-care-its-not-really-about-asset-protection/, last visited October 17, 2014.
[ii] Minn. Stat. § 256B.0595, subd. 2(a).
[iii] “The Perilous Path to Long-Term Care: It’s Not Really about Asset Protection,” Bench & Bar Minnesota, June 5, 2013, http://mnbenchbar.com/2013/06/the-perilous-path-to-long-term-care-its-not-really-about-asset-protection/, last visited October 17, 2014.