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What is the Five-Year Lookback for Medicaid in Florida?

The ‘Five-year’ lookback for Medicaid in Florida is a period of time used by the government to prevent Medicaid applicants from giving away their money or resources in an attempt to qualify for Medicaid benefits that they would otherwise be ineligible for.

Put simply, in the five years prior to your application, you cannot ‘give away’ your assets in an illegible manner (such as below fair market value).

The most common ineligible asset transfer is the gifting of an asset or cash to a relative. By being aware of these rules, you can plan carefully with a Florida elder law attorney well in advance

What Is the Medicaid Lookback Penalty Period?

When you apply for Medicaid for long-term care benefits, your recent finances will be reviewed. If prohibited transfers of money or assets are recognized your application will not only be rejected, but you’ll also face a penalty period. A good application will have explanations detailing any unusual or unexpected expenses paid out from a bank account with substantiation to avoid any delays.

How to Calculate the Medicaid Lookback Penalty in Florida

The Medicaid lookback penalty period is calculated from the total amount of ineligible transfers and the average private patient rate (penalty divisor) for nursing home care in Florida.

Number of Months Excluded from Receiving Medicaid Payments = Total ineligible transfers ÷ the penalty divisor

In 2022, the Florida penalty divisor is $9,703 per month.

For example, if you made $115,000 in ineligible transfers over the past 5 years (during the lookback period), which included your home and gifting of money, then you’d be penalized from benefits for 11.85 months. Submitting an application will allow an applicant to trigger the penalty period. After the penalty period ends, he or she will be able to reapply.

$115,000 ÷ $9,703 = 11.85 months ineligibility period.

Note that improperly disposed assets are classified as those that are gifted, transferred or sold for less than their fair market value.

How Do I Get Around Medicaid 5-Year Lookback?

There are still legal ways to reduce your asset and income levels without breaching the five-year lookback for Medicaid in Florida rules. It’s advised that you always consult an elder law attorney before making these actions, but they can include:

  • Community Spouse Resource Allowance (CSRA): As of 2023, you can transfer up to $148,620 to your spouse as long as they continue to live independently. This rule prevents the spouse who isn’t going to receive nursing home care from having inadequate funds available.
  • Disabled Children: You can also transfer assets to disabled children aged under 21 to pay for their care. The best way to do this is usually by creating a trust in their name.
  • Siblings: Siblings that have been living in your home for at least a year and own a portion of it may also receive your share of the home.
  • Adult Children Caregivers: Adult children who are primary caregivers and have lived with the applicant for at least the past two years can receive the home without penalty.
  • Pay Off Debt: Medicaid rules do not prohibit paying off personal or joint debts, including mortgages or HELOCs or residences you can transfer to others.
  • Spending Down: You are also allowed to spend the money as you wish on home improvements.

Read Related: Do I Need an Elder Law Attorney in Florida?

How to Legally Protect Your Assets Before the “Look Back” Period?

If you or a loved one don’t need immediate long-term care, it’s advised that you plan in advance regardless. Planning in advance is one of the wisest things you can do for your long term care. Here’s what you should do:

  • Have your estate plan created and updated, including:
    • Updated wills
    • Updated trusts
    • A valid power of attorney and medical power of attorney document
    • Health care directives
  • Consider creating an irrevocable trust for Medicaid purposes, which allows you to protect your assets and income while still qualifying for Medicaid long-term care.
  • Consider obtaining long-term care insurance coverage.
  • Consult an elder law attorney for the best strategies for you and your family.

Read Related: Applying for Florida Medicaid: Long-Term Care Benefits for Your Elderly Parent

How Do I Protect My Home From Medicaid in Florida?

Married Couples

If you’re a married couple, with one spouse applying for Medicaid in Florida, then Medicaid will not come after your home.

The at-home house (known as the ‘community spouse’) is protected and may live there, regardless of the value of the home or the Medicaid status of the applicant spouse.

If the community spouse passes away before the Medicaid spouse, however, there may be room for concern. This is why it can be wise to consider putting the home in a trust at some point to protect it from creditors.

Single People

Medicaid applicants who are single, and will be moving to a nursing home or assisted living facility, are allowed to own a homestead of up to $636,000 (2022).

Even if that applicant never returns home, it is protected and is not a countable asset for Medicaid purposes. It is also protected from creditors if it descends to your heirs.

Issues may arise though, as all your income will be going to the nursing home costs, so your family will likely need to pay for upkeep, mortgage, insurance and taxes.

Renting the home adds further complication and can result in it losing creditor protection.

What Assets Are ‘Countable’ in the Five-Year Lookback for Medicaid in Florida?

The following assets are considered ‘countable’ during the five-year lookback for Medicaid in Florida.

  • Cash
  • Stocks
  • Bonds
  • Investments
  • Credit Union
  • Savings
  • Checking Accounts
  • Real Estate (not including the applicant’s residence or the value of one income-producing property).

Hire an Elder Law Attorney in Riverview

If you or a loved one needs assistance navigating the five-year lookback for Medicaid in Florida, or has any questions, our Florida Medicaid planning lawyers can help. We advise that you consult with as soon as possible, to avoid making any costly mistakes and to put you and your loved ones at ease. We welcome you for a free assessment today.

Free Assessment

Battaglia, Ross, Dicus & McQuaid, P.A. is U.S. News and World Reports Tier 1 law firm in Florida, specializing in Estate Planning & Probate since 1958. With award-winning, experienced estate planning attorneys, they can help you plan for the future today.

Schedule a free assessment today to get started


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