Medicaid could be a part of your future, which is why you need to think about qualifying for it even if you don’t need those benefits right now. As someone living in Massachusetts, if you need to move into an assisted living facility or require other forms of long-term care, you will need to qualify for MassHealth, which is the state Medicaid program.

Unfortunately, there are penalties possible for MassHealth applicants who don’t plan ahead to qualify when the time comes. The state will look back at recent financial transfers, including gifts to family members, sales below market value and the transfer of assets into a trust.

The penalties you face could include paying the same amount out-of-pocket as the amounts you transferred before MassHealth covers you. How far back will the state look into your financial records?

MassHealth has a 60-month lookback period

Like most other states, Massachusetts uses the federal standards for its Medicaid program. That means that applicants are subject to a review of 60 months or five full years of financial transactions when they apply for benefits.

If the state discovers that you have made transfers during that time, the transferred amount will likely put you at risk for a penalty before you can receive benefits. Clearly, this approach skews Medicaid applications in favor of those who begin to plan well before they think they need coverage.

If you or your older family members have reached the age of retirement, it’s probably time to start thinking about long-term care and Medicaid planning, especially if you share resources with a spouse or hope to leave a legacy for others when you die.