Medicaid is a needs-based program, so it is understandable to worry that you might need to spend all your savings before qualifying.
While Medicaid has strict income and asset rules, proper planning can help protect some or most of your savings. It is possible to become eligible for Medicaid without leaving your loved ones without support.
What are the Medicaid eligibility requirements?
New York Medicaid requires that applicants meet financial eligibility rules. For an individual to qualify for long-term care Medicaid in 2025, countable assets must fall below $32,396. These countable assets include bank accounts, investments and most retirement funds. However, not all assets count. Medicaid excludes certain property, including certain personal belongings and a primary residence with an equity interest under $1,097,000.
Should I move assets to qualify for Medicaid?
Transferring assets right before applying for Medicaid can create problems. New York applies a five-year lookback period for nursing home care. Any gifts or transfers for less than fair market value during that time may lead to a penalty period of ineligibility. Planning well in advance helps avoid these penalties.
How can I protect my savings and still qualify?
One way to protect savings is through a Medicaid Asset Protection Trust. This is an irrevocable trust that, when created and funded properly at least five years before applying, can shield savings and a home from Medicaid requirements. Once assets move into the trust, the person setting up the trust no longer controls them directly, which makes them exempt from Medicaid’s asset limits after the five-year lookback ends.
Some people also choose to convert countable assets into income-producing exempt assets. In the case of married couples, New York also allows the healthy spouse to keep a larger share of the couple’s joint assets. This rule helps protect the financial stability of the spouse who remains at home.
Medicaid planning does not always require giving everything away. With the right tools and timing, many New Yorkers find ways to preserve savings and still get the care they need. Acting early provides more options, bypasses penalties and maintains more of what you earned over a lifetime.