College savings may affect Medicaid eligibility

Many New York residents have savings goals they want to achieve. For instance, individuals who want to attend a certain college or who want to help their loved ones attend college may have an account set up to accumulate funds for that purpose. However, some concerns regarding those funds may come about if a person ends up in need of Medicaid.

Several factors could affect whether a Medicaid agent considers a college savings fund when determining eligibility for benefits. Agents will conduct a five-year review that involves looking at how a person used his or her money in that period. If a person made a gift to the account more than five years ago at the time of application, the gift will likely not result in a Medicaid penalty.

The type of account may also play a role. If a college savings fund is in an account that an individual could easily access and liquidate, Medicaid will likely consider those funds when determining eligibility. If the account used was a 529 college savings plan, then the funds were removed from the taxable estate and not included in Medicaid eligibility.

Whenever it comes to qualifying for Medicaid, New York residents likely have many questions. It can be difficult to know the right steps to take to plan for government assistance as each person's case is different. Fortunately, interested individuals can discuss their particular needs and circumstances with knowledgeable attorneys who could provide information on ways to plan for these benefits before the need arises and what assets may be considered when trying to gain eligibility.

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