Planning for Medicaid isn’t something you want to take lightly. A lot of folks think they’ve got it all figured out; they heard something from a friend, read an article online, or assume they have too much money to qualify. But the truth is, believing in these common Medicaid myths can end up costing you real benefits. Worse, it could put your savings, your home, and even your care at risk. That’s why having the right guidance matters from the start.
At Schlessel Law PLLC, working with our seasoned Long Island Medicaid planning attorneys means you’re not left guessing. You’ll get clear, practical advice that helps you avoid the most common pitfalls people fall into, like gifting away assets too late, missing key paperwork, or assuming a will protects everything. The process doesn’t have to be overwhelming, but it does take careful steps, and that’s where experience counts. If you’re planning for yourself or helping a loved one, take the time to talk with someone who does this work every day. It’s one conversation that could save you a lot of stress and money down the line. Contact us today at (516) 574-9630 for a free consultation.
Don’t Let These Medicaid Myths Cost Your Family Everything
Let’s be honest, Medicaid planning in New York can feel stressful. You’ve probably heard stories from friends or family that made you worry about losing everything you’ve worked for. But here’s the thing: a lot of that fear is based on misinformation. So let’s clear up some of the biggest myths that could be putting your financial future and your family’s at risk.
Thinking You Have Too Much Money to Qualify for Medicaid
You might believe that your income or assets are too high for Medicaid eligibility. However, New York’s 2025 Medicaid guidelines allow individuals to have up to $1,800 in monthly income and $32,396 in assets. For married couples, the limits are $2,433 in monthly income and $43,781 in assets. Additionally, if one spouse is applying for nursing home Medicaid, the non-applicant spouse can retain up to $157,920 in assets.
Certain assets, like your primary residence (up to $1,097,000 in equity), are exempt. Moreover, strategies such as pooled income trusts can help manage excess income while maintaining eligibility.
Why Waiting Until a Crisis Hits is a Costly Mistake
Delaying Medicaid planning until a health crisis arises can be financially detrimental. New York enforces a five-year lookback period for nursing home Medicaid. This means any asset transfers made within five years before applying can trigger penalties, delaying eligibility.
Starting in 2025, a 30-month lookback period is also planned to be implemented to community-based Medicaid services, such as home care. Planning ahead allows you to make informed decisions, protect your assets, and ensure timely access to care.
The Real Story on Protecting Your Life Savings
You’ve worked hard for what you have. Your house, your retirement accounts, your savings, they shouldn’t be wiped out because you need long-term care.
You don’t have to give everything away to protect it. And you definitely don’t need to wait until you’re flat broke. There are legal tools available right here in New York that let you keep control of your money and still get Medicaid.
This isn’t about gaming the system. It’s about planning wisely, using the laws that are already in place to protect your family’s future.
If you’ve heard that applying for Medicaid means losing your home or draining your savings, you’ve been given bad advice. Taking the time to understand and plan for Medicaid can make a significant difference in preserving your family’s financial well-being. Don’t let those myths make you hesitate. The sooner you take action, the more options you’ll have, and your future self and your family will thank you for it.
Long Island Medicaid Planning Attorney – Seth Schlessel
Seth Schlessel
Seth Schlessel is the Managing Member and Founder of Schlessel Law PLLC, a Long Island-based firm focused on estate planning, elder law, and Medicaid planning. Since earning his law degree from Touro Law School in 2013 and admission to the New York Bar in 2014, Seth has guided individuals and families through the legal processes of wills, trusts, probate, and long-term care planning.
At Schlessel Law PLLC, Seth oversees daily operations and handles complex cases, providing clients with personalized strategies to protect their assets and legacies. His dedication to clear communication and tailored legal solutions has established the firm as a trusted resource for estate planning needs in Nassau and Suffolk counties.
Is Gifting Your Assets to Your Kids Really the Best Move?
Thinking about giving your home or savings to your children to qualify for Medicaid? It might seem like a smart way to protect your legacy, but in New York, this approach can backfire. Let’s break down what you need to know to avoid costly mistakes.
How Does the Medicaid Look-Back Period in New York Work?
In New York, Medicaid has a five-year “look-back” period for nursing home care applications. This means that any gifts or transfers of assets made within five years before applying for Medicaid are scrutinized. If you’ve given away assets during this time, Medicaid may impose a penalty period during which you’re ineligible for benefits.
For example, if you gifted $60,000 to your children, and the average monthly cost of nursing home care is $6,000, you can face a 10-month penalty period where Medicaid won’t cover your care.
How Giving Away Your Home Can Backfire
Transferring your home to your children might seem like a way to protect it, but it can have unintended consequences. If you transfer your home and then apply for Medicaid within five years, the transfer could trigger a penalty period, delaying your eligibility for benefits.
Moreover, if your children decide to sell the home, they might face significant capital gains taxes, especially if the home’s value has appreciated since you purchased it.
The Hidden Tax Consequences for Your Children
Gifting assets to your children can also have tax implications. While New York doesn’t have a gift tax, the federal government does. In 2025, you can gift up to $19,000 per recipient without filing a gift tax return. However, any amount above that requires filing, and while you might not owe taxes immediately, it reduces your lifetime exemption.
And, as mentioned, if your children sell the gifted assets, they might owe capital gains taxes based on your original purchase price, which could be significantly lower than the current market value.
Safer Ways to Transfer Assets for Your Heirs
Instead of outright gifting, consider these alternatives:
Medicaid Asset Protection Trust (MAPT): Placing assets into a MAPT can protect them from Medicaid’s asset calculations, provided it’s done at least five years before applying for nursing home Medicaid.
Life Estate Deed: This allows you to retain the right to live in your home for the rest of your life, with the property transferring to your heirs upon your death, potentially avoiding probate and reducing capital gains taxes.
Spousal Transfers: Transferring assets to a spouse is generally exempt from Medicaid’s look-back rules, providing a way to protect assets without penalties.
Caregiver Agreements: If a family member is providing care, formalizing this arrangement with a written agreement can allow for compensation without violating Medicaid rules.
Before making any decisions, it’s crucial to consult with a professional familiar with New York’s Medicaid laws to ensure your plans align with current regulations and protect your family’s financial future.
Why Your Will Won’t Protect Your Assets from Medicaid Costs
If you think a will is enough to keep your home or savings safe from Medicaid, you’re not alone, but you may be in for a surprise. A will decides who gets what after you pass away, but it doesn’t shield anything from Medicaid. In New York, Medicaid can still come back for repayment. That’s why it’s so important to know what really happens after you’re gone and what you can do while you’re still here.
The Difference Between Probate and Medicaid Estate Recovery
In New York, Medicaid can seek reimbursement for the costs of your care from your estate after you pass away. This process is known as estate recovery. It applies to assets that go through probate, that is, assets solely in your name without designated beneficiaries.
So, if your will leaves your house to your children, but it’s still in your name alone, Medicaid can place a claim against it during probate. This means your heirs might have to sell the home to pay back Medicaid, even if your will says otherwise.
How Medicaid Can Claim Assets After You’re Gone
In New York, Medicaid can file a claim against your estate for the cost of the services you received. It doesn’t matter what your will says. Medicaid gets in line with your other creditors, and in some cases, they go straight to the front.
New York’s estate recovery rules are broader than you might expect. The state can pursue assets that:
Are part of your probate estate (like property solely in your name)
Were jointly owned but pass to someone else upon your death
Are in certain types of trusts that don’t meet specific criteria
This means that even assets you thought would bypass probate could be subject to Medicaid’s claim. Your family could be surprised to find that accounts or property they expected to inherit are now tied up in repayment processes.
Here’s what this might look like: you pass away with your house in your name, and your will says it should go to your children. But you used Medicaid to pay for home care or nursing home care. The state then sends a bill to your estate for those services. If there’s no cash to pay it, your home may have to be sold to settle the debt.
This happens more often than you might think. And once the estate is opened in court, it’s public.