By John F. Davenport, Esq. | Davenport & Associates, Norwalk, CT | April 27, 2026
One of the most common questions I hear from families is some version of this: “If my mother needs a nursing home, can Medicaid take her house?”
The short answer is: not while she is alive, in most cases. But after she dies, the state can and often does come after the home through a process called estate recovery. And the rules for qualifying for Medicaid in the first place are so strict that most families are shocked when they learn what is required.
In Connecticut, the average cost of a private room in a nursing home is over $15,500 per month in 2026. In the New York metro area, costs can exceed $16,000. That is roughly $186,000 per year. Medicare does not pay for long-term custodial care. It only covers up to 100 days of skilled rehabilitation after a qualifying hospital stay. After that, families are on their own unless they have long-term care insurance or qualify for Medicaid.
As a licensed attorney in both New York and Connecticut, I help families navigate Medicaid eligibility every week. The families who come to me early have options. The families who come to me in a crisis have far fewer. This post explains the rules, the risks, and the planning strategies that can protect your home and your savings before it is too late.
Medicaid is a means-tested program. To qualify for nursing home coverage, you must meet strict financial requirements in addition to demonstrating a medical need for nursing-level care.
For a single applicant seeking nursing home Medicaid in Connecticut, the asset limit is $1,600. That means you can have no more than $1,600 in countable assets, which includes bank accounts, retirement accounts, stocks, bonds, and cash. Your income must be below the cost of nursing home care in your area, and nearly all of your income goes toward paying for that care, except for a $75 monthly personal needs allowance.
For married couples where one spouse needs nursing home care and the other remains at home, the Community Spouse Resource Allowance allows the at-home spouse to keep up to $162,660 in assets. The home is generally exempt as long as the at-home spouse is living in it, provided the equity does not exceed $1,130,000.
In New York, a single nursing home Medicaid applicant must have assets under $33,038. The income limit is $1,836 per month. The Community Spouse Resource Allowance is also $162,660. The home equity limit is the same: $1,130,000.
| The Numbers That Shock Families Single person asset limit in CT: $1,600 Single person asset limit in NY: $33,038 Average CT nursing home cost: $15,500+/month Average NY metro nursing home cost: $16,000+/month Medicare long-term care coverage: 0 days of custodial care Medicaid lookback period: 60 months (5 years) A lifetime of savings can be consumed in 12 to 18 months of nursing home care. Without planning, the math is devastating. |
This is the rule that catches the most families off guard. Medicaid looks back 60 months (5 years) from the date of your application to review every financial transaction you made. If you gave away assets, transferred property, or sold anything below fair market value during that period, Medicaid imposes a penalty: a period of time during which you are ineligible for benefits, even if you otherwise qualify.
The penalty period is calculated by dividing the total amount transferred by the average monthly cost of nursing home care in your state. In Connecticut, the divisor is $15,526 per month in 2026. So if you gave your daughter $100,000 three years before applying, the penalty period would be approximately 6.4 months during which Medicaid will not pay a single dollar for your care. Your family must cover the cost out of pocket.
This is why the timing of planning matters so much. If you transfer assets into a Medicaid Asset Protection Trust today, the 5-year clock starts running today. If you wait until you need care, it is too late.
While you are alive and living in the home, your primary residence is generally an exempt asset for Medicaid purposes, as long as your equity is under the state limit ($1,130,000 in both CT and NY). If your spouse still lives in the home, it remains protected.
The danger comes after death. Both Connecticut and New York have Medicaid Estate Recovery Programs. After a Medicaid recipient dies, the state has the right to file a claim against their estate to recover the cost of care it paid. If your home is in your individual name when you die, the state can place a lien on it and force a sale to recover what Medicaid spent on your care.
This is the part most families do not learn about until it is too late. They assumed the home was safe because it was “exempt” during the application process. It was exempt from the asset limit. It was not exempt from recovery after death.
| Worried About Losing Your Home to Nursing Home Costs? John F. Davenport, Esq. and Davenport & Associates help CT and NY families locally, as well as clients all across the country, build Medicaid asset protection plans that preserve their home and savings while maintaining eligibility. Click below to schedule your free 30-minute consultation. -> Schedule a Free Consultation -> jdavenportassociates.com/contact-us |
A Medicaid Asset Protection Trust is an irrevocable trust specifically designed to hold assets (including your home) outside of your countable estate for Medicaid purposes. Once assets are transferred into the trust and the 5-year lookback period has passed, those assets are no longer counted toward Medicaid eligibility and are protected from estate recovery.
The key distinction: a revocable living trust does not protect assets from Medicaid. Because you retain control over a revocable trust, Medicaid treats those assets as if you still own them. Only an irrevocable trust, properly drafted, removes assets from the Medicaid equation.
The trust is typically set up so that you can continue living in the home, and the trustee (often a child or other trusted family member) manages the trust according to its terms. You give up ownership, but not the right to live there.
When one spouse needs nursing home care and the other remains at home, careful planning can protect the maximum amount of assets for the community spouse. The $162,660 Community Spouse Resource Allowance, combined with proper income allocation and annuity strategies, can preserve a meaningful portion of the couple’s savings.
Annual gifting to children or other family members can reduce the size of your estate over time. But every gift made within the 5-year lookback window is subject to the penalty calculation. This is why early planning is critical. A gift made today starts the clock. A gift made the year you enter a nursing home creates a penalty.
Connecticut offers a unique advantage through the Connecticut Partnership for Long-Term Care program. If you purchase a qualified long-term care insurance policy and exhaust its benefits, you can protect additional assets equal to the amount the policy paid out when you eventually apply for Medicaid. This can provide a significant layer of protection beyond what Medicaid alone allows.
Irrevocable funeral trusts and prepaid burial arrangements are exempt from Medicaid’s asset count. Setting these up in advance can remove several thousand dollars from your countable assets.
The single biggest mistake families make is waiting until a health crisis to start Medicaid planning. At that point, the 5-year lookback means any recent transfers trigger penalties, the options for asset protection are severely limited, and the family is forced into crisis mode.
Starting the conversation at age 60 or 65, while you are healthy, gives you the full benefit of the 5-year clock. It allows you to set up a MAPT, begin strategic gifting if appropriate, and coordinate your Medicaid plan with your broader estate plan while all options are still available.
These are the questions I hear most from families facing long-term care decisions.
| Q: Does Medicare pay for nursing home care? Only for short-term rehabilitation. Medicare covers up to 100 days of skilled nursing care after a qualifying 3-day hospital stay, and only the first 20 days are fully covered. After day 20, there is a daily copay. After day 100, Medicare pays nothing. For long-term custodial care (help with bathing, dressing, eating), Medicare does not pay at all. |
| Q: Will Medicaid take my house while I am alive? Generally, no. Your primary home is an exempt asset as long as you or your spouse are living in it and the equity is under $1,130,000 in Connecticut (varies by state). However, the home is not protected from estate recovery after your death. This is why planning to move the home into a MAPT before you need care is so important. |
| Q: Can I just give my house to my children to protect it? You can, but if you do it within 5 years of applying for Medicaid, it will trigger a penalty period during which Medicaid will not pay for your care. The penalty is calculated based on the value of the gift divided by the average monthly cost of care. If you plan to gift the home, you need to do it at least 5 years before you might need Medicaid. |
| Q: What is a Medicaid Asset Protection Trust? It is an irrevocable trust designed to hold your home and other assets outside of your countable estate for Medicaid purposes. Once the assets have been in the trust for 5 years, they are protected from both the Medicaid asset limit and estate recovery after death. A revocable living trust does not provide this protection. |
| Q: Is it too late to plan if my parent is already in a nursing home? It is harder, but not always too late. There are crisis planning strategies, including Medicaid-compliant annuities and spousal protection rules, that can still preserve some assets. The options are more limited than if planning had started earlier, but a consultation with an elder law attorney can identify what is still possible. |
| Q: How much does a nursing home cost in Connecticut in 2026? The average cost of a private room in a Connecticut nursing home is approximately $15,500 per month, or roughly $186,000 per year. In the New York metro area, costs can exceed $16,000 per month. These costs have been rising 3 to 5 percent annually. |
Long-term care is one of the largest financial risks families face in retirement. The average need for nursing home care is approximately 4 years, and at $15,500 or more per month, the total cost can easily exceed $700,000. Medicare does not cover it. Medicaid will, but only if you qualify, and the qualification rules are designed to ensure you have spent down nearly everything first.
The families who protect their assets are the ones who plan early. A Medicaid Asset Protection Trust, set up while you are healthy and at least 5 years before you might need care, is the most powerful tool available. Combined with proper estate planning, spousal protection strategies, and long-term care insurance where appropriate, it is possible to preserve your home and your savings while still qualifying for the care you need.
If you have not had this conversation yet, the best time to start is now. Not when a parent falls. Not when a diagnosis comes. Now, while every option is still on the table.
| Questions About Medicaid Planning, Asset Protection, or Long-Term Care Strategy? John F. Davenport, Esq. and the team at Davenport & Associates help CT and NY families locally, as well as clients all across the country, create Medicaid asset protection trusts, coordinate elder law planning with their broader estate plan, and protect the home and savings they have spent a lifetime building. Click below to schedule your free 30-minute consultation. -> Schedule Your Free Consultation -> jdavenportassociates.com/contact-us |
| References & Sources Medicaid Planning Assistance: Connecticut Medicaid Eligibility 2026 (medicaidplanningassistance.org) Medicaid Planning Assistance: New York Medicaid Eligibility 2026 (medicaidplanningassistance.org) MedicareResources.org: Connecticut Medicaid Assistance Programs (medicareresources.org) Medicaid Long Term Care: Connecticut Eligibility (medicaidlongtermcare.org) Genworth/CareScout: Cost of Long-Term Care Survey 2024 (genworth.com) Senior Care Heroes: 2026 Guide to the Medicaid 5-Year Lookback (seniorcareheroesdaily.com) |
| About the Author | John F. Davenport, Esq. John F. Davenport holds a law degree from Pace University and an MBA in finance from Fordham University, and his business degree from the University of Notre Dame. He is a licensed attorney in New York and Connecticut, and financial advisor. He founded Davenport & Associates in 1997 and has spent more than 30 years helping CT and NY families build retirement income plans and estate strategies that work together — not against each other. As both a licensed attorney and financial advisor, John reviews estate plans from both the legal and financial perspective in a single conversation — a combination most families would otherwise need two separate professionals to replicate. Davenport & Associates | 800 Connecticut Avenue, Suite E401, Norwalk, CT 06854 Phone: (203) 853-6300 | jdavenportassociates.com |