Is it OK to give away my assets? What are “penalty periods?”
You can usually give assets away, even if you are already in the nursing home, as long as you do not run afoul of Connecticut Medicaid rules.
If you meet the state’s Medicaid rules, it will pay. If you don’t meet the Medicaid rules, the state of Connecticut won’t pay.
It’s that simple.
In Connecticut, for every $12,388 you away, you are ineligible for Title 19 benefits (also known as Medicaid) for one month (the penalty period).
For example, a gift of $50,000 results in a 4.1-month penalty period ($50,000 divided by $12,388 = 4 months).
Penalty periods start to run when a person would otherwise be eligible for Medicaid, not on the date that the gift is made.
Click here to watch Brendan explain penalty periods.
The bottom line: the sooner you make a gift and the later you apply for Medicaid, the better. For people in ill health or with very few assets, it might not be practicable, as a result of the federal law changes, to make any gifts.
For more about transfers, check out: