Before budget bill passes, attorneys tell seniors to hurry up and transfer assets

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As time winds down to the House vote on the budget reconciliation bill, financial advisers have one piece of advice for seniors: transfer your assets.

Advisers have been encouraging seniors to transfer assets to family members so they can receive Medicaid-funded nursing home care subject to the current rules, according to a recent report in the Wall Street Journal. The bill, if passed, tightens up eligibility for Medicaid. One measure in the bill would disqualify a person from receiving Medicaid for long-term care if he or she owned a home worth more than $500,000. Under current law, primary residences of any value are typically exempt.

The new law also would extend the look-back period for asset transfers to qualify for Medicaid for long-term care. The window would grow to five years from three. It would also change the date of the asset-transfer penalty period to the day of the Medicaid application from the day the gift was made. Transfers made before the law takes effect will not be subject to the new rules, one elder-law attorney told his clients.

The House could vote on the bill, sending it to President Bush for his signature as early as today.