Medicaid Asset Protection Trusts (MAPT) & Qualifying for Medicaid Long Term Care

Summary
To be eligible for Medicaid, applicants need to meet certain financial requirements, including an asset limit. But even if you have assets above the limit, a Medicaid Asset Protections Trust (MAPT) can help you become eligible. Assets that are placed in a MAPT will not count toward the asset limit, and they will also be protected as an inheritance for your family. However, the process and timing for creating a MAPT is state-specific and complicated, and the consequences of doing it incorrectly can mean a penalty or Medicaid denial.

What is a Medicaid Asset Protection Trust?

Trusts are common financial tools that can be used for a variety of purposes. Medicaid Asset Protection Trusts (MAPTs) are used to help you or your loved one become eligible for Medicaid Long Term Care by making the assets in your MAPT exempt from Medicaid’s asset limit. So, someone who would not be eligible for Medicaid because the value of their assets is above their state’s asset limit could become eligible by putting excess assets in a MAPT. Other names for MAPTs include Medicaid Planning Trusts, Medicaid Trusts or Home Protection Trusts. They may also be technically described as Self-Settled No-Access Trusts.

There are many other kinds of trusts that will not help with Medicaid, including the very common revocable living trust. There are also some other types of trusts that will help with Medicaid, such as Irrevocable Funeral Trusts and Qualified Income Trusts, but this article will only focus on MAPTs.

Asset Protection Trust Creation Date & the Look-Back Period

Medicaid Asset Protection Trusts (MAPTs) can only help with Medicaid eligibility if they are created well in advance of you or your loved actually needing and applying for Medicaid Long Term Care. This is because of Medicaid’s Look-Back Period.

Medicaid applicants are not allowed to simply give away their assets in order to become eligible for Medicaid. To make sure they don’t, Medicaid uses the Look-Back Period. In most states, the Look-Back Period is 60 months, which equals five years. That means that with your Medicaid application, you or your loved one will need to submit financial documents detailing all of your assets for the five years prior to applying. Your state’s Medicaid offices will use the documents to “look back” into those five years to make sure you did not give away your assets, or sell them at less than fair market value.

Creating a MAPT during the Look-Back Period is a violation of Medicaid rules. Doing so would lead to your application being denied and a period of ineligibility that could last months or years. The same could happen if you incorrectly create the MAPT or use the wrong kind of trust. During that period of ineligibility, you or your loved one would have to pay for long-term care on your own. To avoid this, consult with a professional like a Certified Medicaid Planner.

There are two exceptions to the 5-year Look-Back Period: California, where there is no look back for HCBS Waivers and it’s 30 months for Nursing Home Medicaid, although that is being phased out by July 2026; and New York, where the Look-Back Period is 60 months for Nursing Home Medicaid and there is no look back for Community Medicaid (similar to HCBS Waivers in other states).

There is another important exception to the Look-Back Period, and that’s based on the Medicaid program. There are three types of Medicaid Long Term Care relevant to seniors – Nursing Home Medicaid, Home and Community Based Services (HCBS) Waivers and Aged, Blind and Disabled (ABD) Medicaid. The Look-Back Period applies to Nursing Home Medicaid and HCBS Waivers, but it does not apply to ABD Medicaid. However, ABD Medicaid applicants may eventually need Nursing Home Medicaid or HCBS Waivers, so they should be careful about doing anything that could violate the Look-Back Period.

To make sure your MAPT doesn’t violate the Look-Back Period, we recommend consulting with a Certified Medicaid Planner or an Elder Law Attorney before creating one.

Understanding Medicaid Asset Limits

As we mentioned above, Medicaid Asset Protection Trusts (MAPTs) can be used to keep your assets exempt from Medicaid’s asset limit. But asset limits vary depending on state, marital status and type of Medicaid.

Assets that are counted toward the asset limit include bank accounts, stocks, bonds, some retirement accounts, certificates of deposit, cash or anything else that can be easily converted into cash. In most cases, your home will be NOT be counted toward the asset limit, and neither will your primary vehicle or certain personal items, like wedding rings. More on how Medicaid treats the home.

In most states in 2025, the individual asset limit for all three Medicaid Long Term Care programs (Nursing Home Medicaid, HCBS Waivers, ABD Medicaid) is $2,000, and the asset limit for a married couple with both spouses applying for any of the three programs is $3,000 or $4,000.

For married couples with just one spouse applying for Nursing Home Medicaid or HCBS Waivers, the 2025 asset limit in most states is $2,000 for the applicant spouse and $157,920 for the non-applicant spouse, who is eligible for the Community Spouse Resource Allowance (CSRA). But the CSRA does not apply to ABD Medicaid applicants, so for married couples with only spouse applying for ABD Medicaid, the asset limit is still generally either $3,000 or $4,000.

However, there are many exceptions to these generalities. In Illinois, the asset limit for all three Medicaid Long Term Care programs is $17,500 for individuals and married couples with both spouses applying. In Florida, the asset limit for Nursing Home Medicaid and HCBS Waivers is $2,000 for an individual and $3,000 for a married couple with both spouses applying, but the asset limit for ABD Medicaid is $5,000 for an individual and $6,000 for a married couple In California, there are no asset limits for any of the three Medicaid Long Term Care programs.

Assets Allowed in Medicaid Asset Protection Trusts

There are many types of assets that can be placed in a Medicaid Asset Protection Trust (MAPT). This includes savings accounts, checking accounts, mutual funds, certificates of deposit, stocks and bonds.

You or your loved one can also place your home in a MAPT to make it exempt from the asset limit. Even if you do this, you can still continue to live in the home. There is one exception to this rule and that’s Michigan, which still counts the home as an asset even if you place it in a MAPT.

You can also place real estate other than your primary home in the MAPT, like a vacation home or a piece of land.

Income producing assets can also be placed in a MAPT. In these cases, the principal is protected from the asset limit while the grantor/Medicaid beneficiary can collect the income without violating the Look-Back Period. However, in addition to an asset limit, Medicaid also has a monthly income limit that you must meet when you apply and continue to meet when you start receiving Medicaid benefits, and that income will be counted toward the income limit. In most states in 2025, the individual income limit for Nursing Home Medicaid and Home and Community Based Services Waivers is $2,901/month. It varies more with ABD Medicaid, which is between $967/month and about $1,800/month in 2025, depending on the state.

Placing a retirement account like a 401k or an IRA in a MAPT is not typically recommended. That’s because cashing out the retirement account to put it in the MAPT would have tax consequences.

Basic Rules for Medicaid Asset Protection Trusts

Here are some key technical terms used for the people involved in Medicaid Asset Protection Trusts (MAPTs) and the rules about who those people can be:

• Grantor – The person who creates the MAPT. Also called a trustmaker or settlor. This would be the Medicaid applicant who has too many assets to be eligible.
• Trustee – The person who controls the trust and the assets in it. The trustee can not be the grantor or the grantor’s spouse, but it can be another family member, such as an adult child, or anyone else.
• Beneficiary – The person who will control the trust after the grantor’s death. The beneficiary can not be the grantor.

Who is the grantor, trustee and beneficiary are not the only rules associated with MAPTs. These kinds of trusts must also be irrevocable, which means they can not be undone or changed in any way after they’re created in order for them to be Medicaid-compliant. There are also restrictions on how the money in the trust can be used while the grantor/Medicaid beneficiary is still living. Most importantly, the trustee can not spend any of the funds in the MAPT on the grantor.

Understanding and following all these rules and creating a MAPT that will be Medicaid-compliant is difficult. Before attempting to do this on your own, we recommend consulting with a Certified Medicaid Planner or an Elder Law Attorney.

How Medicaid Estate Recovery Programs Treat Assets in MAPTs

Every state is required by law to try and collect reimbursement for the money they spent on Medicaid Long Term Care for an individual after that individual’s death. The process is known as Medicaid Estate Recovery. A MAPT is one way to protect your assets from estate recovery and keep those assets safe for your heirs because any asset placed in a MAPT can not be used for estate recovery by Medicaid. The rules for Medicaid Estate Recovery can vary greatly by state. To learn more about estate recovery, click here.

Disadvantages of Medicaid Asset Protection Trusts

The biggest drawback to using a MAPT as a tool to become eligible for Medicaid is the timing. We discussed this in detail above, but in short, you must create the MAPT five years in advance for it to actually help you gain Medicaid eligibility.

Another drawback to MAPTs is that once the assets are placed in them, the grantor/trustmaker no longer has access to those assets. So, if there is some kind of financial emergency, you would not be able to use whatever assets are in the trust to handle that emergency.

MAPTs are also fairly expensive to create. They usually run between $2,000 and $12,000. Since this is the case, they typically aren’t recommended unless you have at least $100,000 in assets. If you have less than $100,000 in assets and need to reduce the excess to qualify for Medicaid, there are alternative methods. This includes purchasing an Irrevocable Funeral Trust to cover your burial expenses, buying a Medicaid Compliant Annuity, or spending down the excess assets on allowable goods and services, like pre-paying for long-term care, or making medically necessary home modifications such as adding a wheelchair ramp. To learn more about Medicaid spend down, click here.