The Medicaid five-year lookback period is a rule that requires Georgia Medicaid to review all asset transfers you made in the five years before your application for nursing home benefits. If you gave assets to family members, moved them into certain trusts, or gave them away some other way during that window, Medicaid can penalize you and delay your benefits. The rule comes from federal law, 42 U.S.C. § 1396p(c).
Understanding this rule is essential for anyone doing Medicaid planning in Georgia.
How the Lookback Period Works
When you apply for Georgia Medicaid nursing home benefits, the state looks at five years of financial records. That includes bank statements, tax returns, deeds, and transfer records. The question it is asking: did you give away assets to make yourself look poorer than you are?
Any transfer of assets for less than fair market value during the lookback period can trigger a penalty. This includes:
- Gifting money to children or grandchildren
- Transferring your home to a family member for $1
- Creating an irrevocable trust and funding it
- Adding a family member to a bank account as a joint owner and then removing yourself
What the Penalty Looks Like
The penalty is not a fine. It is a period of months when Medicaid will not pay for your nursing home care. Georgia calculates the penalty by dividing the value of transferred assets by the average monthly cost of nursing home care in the state.
Example: Say you transferred $100,000 within the lookback period. Georgia divides that amount by $11,122 a month, the average private-pay nursing home rate the state has used since April 2026. Your penalty period would be about nine months. During those nine months, Medicaid will not pay for your care even if you are otherwise eligible.
For most families, the penalty does not start when the transfer is made. It starts later, once you are in a nursing home, have applied, and would otherwise qualify for Medicaid. This can leave families in a very difficult position: in a nursing home, out of money, and waiting out a penalty period with no coverage.
What Is Not Penalized
Not all transfers trigger a penalty. Exceptions include:
- Transfers to your spouse
- Transfers to a child of any age who is blind or permanently disabled
- Transfers into a trust set up only for your blind or permanently disabled child, or only for another disabled person under age 65
- A transfer of your home to a son or daughter who lived there with you for at least two years right before you entered a nursing home, and whose care let you stay home during that time
Each exception has conditions, and Georgia’s Medicaid office decides whether you meet them.
Why This Means You Must Plan Early
The lookback period is the main reason Medicaid planning has to start years before you need care. When you ask Medicaid to pay for nursing home care, Medicaid looks back five years (60 months). Moving assets into a Medicaid Asset Protection Trust (MAPT) counts as a transfer. To stay clear of the transfer penalty, an asset has to go into the trust more than five years before you ask Medicaid to pay.
Say you move assets into a MAPT at 66 and do not ask Medicaid to pay for nursing home care until 72. More than five years have passed. That move is outside the lookback, so it causes no transfer penalty.
Now say you move the assets at 70 and ask Medicaid to pay at 72. That move is inside the lookback. The full value you moved counts toward the penalty. You do not get credit for the two years that passed.
Even after five years, no trust is a guarantee. Money the trust earns still counts as your income for Medicaid.
Common Mistakes Families Make
Mistake 1: Giving money to children informally. The annual gift tax exclusion ($19,000 per recipient in 2026) is an IRS rule. It is not a Medicaid rule. Medicaid does not care about gift tax exclusions. Every dollar given away within the lookback period is potentially penalized.
Mistake 2: Waiting until a crisis. The most common Medicaid planning mistake is waiting until a parent is in a nursing home or just received a diagnosis. At that point, the lookback period makes most strategies unavailable. See what happens with no Medicaid planning in Georgia.
Mistake 3: Assuming a revocable trust protects assets. A revocable living trust is great for avoiding probate but does nothing for Medicaid. Because you can take assets back from a revocable trust, Medicaid counts them as yours.
What You Can Do Now
If you are in your 60s or early 70s and thinking about long-term care, the window is open. A Medicaid Asset Protection Trust funded now starts the five-year clock while you are still healthy. See what a Medicaid Asset Protection Trust costs in Georgia.
The Hive Law works with Georgia families on Medicaid planning and elder law. Your first call is free, about 15 minutes, and happens by phone with Shawn. If you move forward, your next step is the Design Meeting with Shawn and Melissa, which is credited toward your plan.
