What is the Medicaid “Look-Back” period? Medicaid “looks back” into the past to see if the applicant has given away any money or property in order to qualify for benefits. The length of the Look-Back period is five years before the application date. On the application for Medicaid long-term care benefits, the following question must be answered:
“Did you sell, trade, or give away money (including income), property, or anything else in the past 5 years?”
Medicaid is a federal-state program based on financial need. An applicant who is not married can have no more than $2,000 in countable resources in order to qualify for benefits. “Resources” include bank, investment, and other financial accounts, real estate other than a homestead, mineral interests, and other assets.
Medicaid can impose a penalty if the applicant has given away any resource or income, with a value of $200 or more, during the Look-Back period. The penalty is a period of ineligibility for benefits which is calculated by dividing the value of the resource gifted by a daily nursing home rate of $242.13 (2025), resulting in a number of days of ineligibility. The penalty period begins on the first day that the applicant would otherwise be eligible for benefits. An applicant for nursing home benefits would have to pay privately for nursing home care during the penalty period. However, there are a few exceptions to the penalty for gifting or transferring assets during the Look-Back period.
Misconceptions about the Look-Back rules are common. Medicaid does not penalize the sale of property, such as real estate or a car, provided it was sold for market value. Medicaid does not penalize an applicant for spending funds for the applicant’s own use and benefit, provided that expenditures of $200 or more are verified. The Medicaid Look-Back penalty applies only to the gifting of property, or the transferring of property for less than market value, in the past five years before applying.