Look Back Penalty Definition

The “look-back period” is the time before a person applies for Medicaid. During this time, asset transfers will be inspected with minute detail. A transfer within the look-back period will be questioned and, if something of equal value was not received in return, a look back penalty will be applied, which will prevent the person from receiving Medicaid long-term care benefits until the period of the penalty expires. The look-back period is typically 60 months, or 5 years, for transfers under the Deficit Reduction Act 2005. In states that have not yet implemented the DRA, it may be only 36 months (3 years) for transfers to complete (Unless funds are transferred into a trust).

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