In general terms, the “retrospective view” is 60 months (5 years). For example, a Florida resident applies for Medicaid on January 1.The government uses the retrospective period to see if Medicaid applicants simply donated their money or other assets to exceed Medicaid asset limits, which are low. In most states, the retrospective period lasts five years. This means that state officials who are reviewing your Medicaid application “will review your financial history for the five years prior to the filing of the application to ensure that you have not given away money or assets or sold them at a price lower than the fair market.” The 5-year retrospective analysis of Medicaid is a rule that checks your financial history for the past five years to see if you have given away any assets that may affect your eligibility for Medicaid.
Understanding this period and planning for it is crucial if you want to avoid fines and delays in receiving benefits. The idea of a 7-year retrospective is a misconception and is not part of current Medicaid law or policy. Most states have a 5-year (60-month) Medicaid retrospective period for asset transfers, without an official 7-year retrospective period. When you apply for Medicaid for long-term care, your financial history for the past five years is reviewed to determine if you qualify.
The most important thing to remember when taking steps to protect Medicaid income is that Medicaid has a five-year retrospective period. Medicaid steps in to help older people pay for long-term care when they don't have enough money to pay for it personally. There are rules that prevent older people from transferring money to friends and family to avoid using their own money. Medicaid analyzes up to five years of financial transactions to ensure that assets were not illegitimately transferred.
If assets were found, the applicant would be banned from receiving Medicaid benefits using a “penalty formula.” There are suitable strategies for transferring assets, but you must follow specific rules. It's best to work with an attorney and financial advisor to create a plan before making any transfer. Lifetime care agreements, also called lifetime care agreements or elder care agreements, are a great way for older people who require a caregiver to spend their additional assets without violating the Medicaid retrospective period.
