Short answer: When someone applies for nursing facility or HCBS waiver Medicaid, HHSC reviews asset transfers made in the 60 months before the later of the application date or the date of entering the facility. Gifts or below-value transfers in that window can cause a period when Medicaid will not pay for long-term care.
The look-back is 60 months, counted back from the later of the Medicaid application or institutionalization. If someone is already on Medicaid before entering a facility, the look-back starts at institutional entry. Transfers made before the look-back date cannot be penalized.
It applies to long-term care: nursing facility care, an equivalent institutional level of care, and home and community-based waiver services. It is not part of ordinary children’s or pregnancy Medicaid.
What HHSC looks for: gifts of cash or property, selling assets for less than fair market value, refusing or reducing income the person could receive, and payments out of a revocable trust to anyone other than the person. The family should expect to produce up to five years of statements and explain large withdrawals.