Elder Law FAQ's

What are the MassHealth long-term care asset limits?

If an unmarried applicant requires MassHealth coverage for long-term care, he or she can only have $2,000 in countable assets.  If both members of a married couple require MassHealth coverage for long-term care, then the couple can keep $3,000 in countable assets.  If only one member of a married couple requires MassHealth coverage, and the other member of the couple is staying in the community, then the institutionalized spouse can keep $2,000 and the community spouse must have less than $109,560 in his or her name, but there are some exceptions to the rules depending on a community spouse’s needs.

What is the five year look back period?

The five year look back period is used to determine whether a MassHealth long-term care applicant has made disqualifying transfers of assets that render him or her ineligible for benefits.  Basically, MassHealth has the right to look at an applicant’s financial records for the five years prior to the applicant’s application date to see if he or she gave away any funds for less than market value.  For instance, if an applicant files for benefits on June 1, 2010, then the look back period runs from June 1, 2005 through June 1, 2010.  If an applicant made any transfers during this time, he or she will be denied MassHealth coverage for a certain period of time.

Does any transfer of assets create a problem for MassHealth long-term care applicants?

Any transfer of assets made within five years of a MassHealth application could have serious repercussions for an applicant.  MassHealth penalizes applicants for any transfer for less than fair market value – this means any gift, technically in any amount, to anyone other than a spouse, or any loan for less than market rate.  People often ask if this restriction on transfers applies to gifts of less than $13,000 (which is the federal gift tax exemption).  The answer is – YES.  MassHealth does not care about gift taxation – it looks at any transfer, no matter how small. 

If I’ve made a gift during the five year look back period, what happens?

The answer is too complicated to explain in detail here.  Essentially, MassHealth divides the amount of the gift by the amount of money that MassHealth would spend on an applicant’s care for a given month.  The resulting number is the so-called “penalty period”, during which an applicant will not receive care.  For instance, if an applicant gives away $70,000, and MassHealth would spend $7,000 a month on care, then the applicant is disqualified for 10 months.  This disqualification period only begins to run when an applicant is otherwise eligible for MassHealth, which means that once an applicant is under the asset limit, the penalty period begins.  The problem then becomes – how does an applicant pay for care while the penalty period runs?

Can the state come after my home if I require MassHealth coverage for long-term care?

As with most MassHealth questions, the answer is “it depends”.  If you are an unmarried applicant who owns your home in your own name, then the state can place a lien on the home while you are in a nursing facility, and if the home is sold, the state will recover the cost of your care from the sale proceeds.  If you pass away without selling the home, the state can pursue estate recovery, force the sale of the house, and recoup its costs.  If you are married, and your spouse lives in the home, then the state cannot come after the house while you are alive, and in many cases cannot pursue estate recovery against the property after you are gone.  However, if your spouse then requires care, the state will be able to pursue recovery against her estate.  Proper, early planning can avoid this result.

What does a guardian do?

A guardian manages the daily affairs of an incapacitated person.  This includes arranging for his or her care, interacting with caregivers and arranging services, making sure that the incapacitated person lives in a healthy environment and arranging for food if the incapacitated person cannot cook.  Depending on the type of guardianship, the guardian is also responsible for making sure that the incapacitated person receives proper medication and health care, and some guardians even have the ability to sign the incapacitated person into a long-term care facility.

What does a conservator do?

A conservator manages the funds of the person to be protected.  He or she has access to the person to be protected’s bank accounts, investments, retirement accounts and any other sources of income.  A conservator has a duty to properly manage the funds and account to the court for his or her actions as conservator.