What happens if you or your family member must move from one state to another and then apply for Medicaid? What if you or your family member is already in the Medicaid program and then moves? Will you lose your eligibility?

First of all, it is a violation of the U.S. Constitution to impose a residency requirement on an individual who moves into a state and then needs to apply for Medicaid. So the day after an individual moves, he or she can apply for Medicaid.

That being said, the person who is moving will still need to meet the asset and income requirements of the new state's version of the Medicaid program. In addition to the federal requirements that apply to all states (no more than $2,000 in liquid assets, no more than a certain amount of income, etc.), there are other optional requirements and regulations that vary from state to state. If the requirements for eligibility are different in a person's new state of residence than they were in their previous state of residence, then they must meet the eligibility requirements of the new state before Medicaid will cover their expenses.

For example, there may be different requirements as what types of gifts are allowed, different calculations for penalty periods following gifts, or different rules governing Medicaid annuities or the exemption of the personal residence.

As you can see, even if a person was already on Medicaid in one state, there is no guarantee that they will qualify for Medicaid in another state. If your loved one must move, it would be advantageous to understand the rules of their new state of residence, so that they don't make any gifts or implement any planning techniques in the old state that may have negative consequences in the new state. By understanding the rules of both states, your family member may be able to adjust the timing of their gifts before the move, as well as the timing of their Medicaid application in the new state.

In addition, because many states operate under federal waiver programs, the relocated individual may have to go on a long waiting list to get Medicaid coverage, and indeed the coverage under the prior state's waiver program may simply not be available in the new state (for example, some states cover assisted living costs and some do not). Again, once a person moves, he or she is governed by the program rules and coverage of their new state.

Bottom Line: If an aging family member has the option to move or not, then he or she would be wise to check with an experienced elder law attorney in the state they are considering moving to. Be sure they understand how the rules of the new state would apply to their situation, so no one is faced with any nasty (and expensive) surprises!