New Medicaid rules for long-term care penalize gifts, reward people who buy insurance

Today's column takes a look at the new rules for qualifying for Medicaid in Florida. The primary goal is to make sure that the government doesn't pick up the tab for nursing home bills unless you really are poor. People who impoverish themselves by giving away assets will be disqualified (how long depends on how much you gave away). One way you can preserve more assets for your spouse or other heirs will be to purchase a new long-term care insurance policy that qualifies under the new "partnership program." Essentially you're allowed to keep assets matching the amount of benefits under the policy.

One note of explanation: The look-back period for transfer of assets is now officially five years rather than three. However, the longer period only applies to assets transferred after February 8, 2006, when federal law on the subject changed. Thus a three-year lookback will still apply until February 2009, when gradually it will be extended until it encompasses five years. Here's some discussion on this point. A five-year lookback is already in effect for asset transfers involving trusts.

Medicaid eligibility is administered by the Florida Department of Children and Families. Unfortunately, I've never found anyone there willing to discuss the subject with me. However, you might be able to get someone to answer your questions if you call 866-762-2237.

Here are the income and asset eligiblity requirements.