Medicaid asset protection planning in Florida is the practice of legally restructuring your income and assets — well before you need long-term care — so that you can qualify for Medicaid’s nursing home or in-home care benefits without spending your life’s savings down to the bone. Done correctly, it lets you preserve a home, a portion of liquid wealth, and an inheritance for your family while Medicaid covers care that can run $11,000 to $14,000 a month. Done late, or wrong, it triggers penalties that delay coverage for months or years.
I draft these plans for Miami professionals and physicians who have spent decades building something and are stunned to learn that a long-term illness can erase it in two or three years. The rules are technical and unforgiving, but they are knowable. Here is how the system actually works in Florida.
Why Long-Term Care Medicaid Is a Planning Problem, Not Just a Welfare Program
People hear “Medicaid” and picture a program for the indigent. The reality for long-term care is different. Medicare — the program most retirees rely on — pays for only about 100 days of skilled nursing after a hospital stay, and far less in practice. It does not pay for custodial care, which is the help with bathing, dressing, eating, and medication management that most people actually need at the end of life. That bill falls to you.
For a Miami physician or business owner, the instinct is to self-insure: “I’ll just pay for it.” And many can, for a while. But three or four years of memory-care or skilled-nursing costs will consume a seven-figure portfolio faster than most people believe. Long-Term Care Medicaid — specifically Florida’s Institutional Care Program (ICP) and the Statewide Medicaid Managed Care Long-Term Care program for home and community-based services — exists to pick up that cost. The catch is that it is means-tested. You have to be poor enough, on paper, to qualify. Planning is the lawful art of becoming eligible without becoming destitute.
The Two Tests: Income and Assets
Florida evaluates two separate things, and you must pass both. People conflate them constantly, and the distinction matters enormously.
The income cap
Florida is an “income cap” state. For 2026, an applicant’s gross monthly income generally cannot exceed $2,982 — that figure is 300% of the federal SSI benefit rate and it adjusts each year. “Gross” means before deductions: Social Security, pensions, annuity payments, required minimum distributions, rental income — all of it counts.
For a retired professional, $2,982 is a low ceiling. A physician’s pension and Social Security alone often blow past it. The good news is that being over the cap does not disqualify you in Florida. It simply means you need a Qualified Income Trust (QIT), also called a Miller Trust, which I’ll explain below.
The asset test
Separately, a single applicant may keep only $2,000 in countable assets. Two thousand dollars. That number has not meaningfully moved in decades, and it is the figure that shocks people. Countable assets include bank accounts, brokerage accounts, CDs, cash-value life insurance over a small threshold, and second properties.
Crucially, some assets are non-countable (exempt):
- The homestead — your primary Florida residence, protected under Article X, Section 4 of the Florida Constitution, up to a substantial equity limit and within the constitutional acreage limits (one-half acre inside a municipality, 160 acres outside).
- One automobile, regardless of value.
- Personal effects and household goods.
- An irrevocable, prepaid funeral or burial contract.
- Certain term life insurance with no cash value.
The planning game, in large part, is converting countable assets into exempt ones or into properly structured trusts — within the rules, and within the timing windows.
The Qualified Income Trust (Miller Trust)
If your gross income exceeds $2,982 a month, a QIT is mandatory, not optional. It is a narrow, irrevocable trust into which you divert the excess income each month. Income that passes through a properly drafted and administered QIT is treated as unavailable for the income test — even though it still gets used to pay your share of care costs.
Three rules govern it, and each one trips people up:
- The trust must be irrevocable and drafted to meet the federal requirements under 42 U.S.C. § 1396p(d)(4)(B).
- It must be funded every single month. A QIT that exists on paper but isn’t funded in a given month fails for that month — and a missed month can cost you coverage. This is an administration discipline, not a one-time event.
- The State of Florida must be named as the residual beneficiary, meaning whatever remains in the trust at death goes to the state up to the amount it paid for your care.
A QIT solves the income problem only. It does nothing for the asset test, and it does not protect your house. People who set one up online and assume they’re “covered” learn this the hard way.
The Five-Year Lookback and Why Timing Is Everything
Here is the rule that makes early planning so valuable. When you apply for institutional Medicaid, Florida reviews 60 months of your financial history — the five-year lookback. Any uncompensated transfer during that window — gifting money to children, retitling a property for less than fair value, funding certain trusts — creates a transfer penalty.
The penalty is a period of ineligibility, calculated by dividing the gifted amount by Florida’s penalty divisor (the average monthly private-pay nursing cost, $10,645 for 2026). Give away $106,450 inside the window and you create roughly a ten-month penalty — and that penalty doesn’t even start running until you are otherwise eligible and already in a facility. That is the worst possible time to have no coverage and no assets.
This is why I tell clients the most powerful Medicaid planning happens when you are healthy and don’t need it yet. A transfer made more than five years before application is invisible to Medicaid. The clock has already run. The patient who plans at 68 has options the patient who plans at 82, mid-crisis, simply does not.
Trusts That Actually Protect Assets
The centerpiece of proactive planning is the Medicaid Asset Protection Trust (MAPT) — an irrevocable trust you fund well outside the lookback window. Once assets have been in the trust for more than five years, they no longer count against you, yet the trust can be structured so you retain the right to live in your home and receive trust income for life, with the principal preserved for your heirs.
The trade-off is control. To get the protection, the trust must be irrevocable, and you generally cannot serve as your own trustee or reach the principal yourself. That is a real concession, and it is not right for everyone — which is exactly why this should be designed by an attorney who does long-term care planning, not pulled from a template. Florida also recognizes pooled and special-needs trust structures for disabled beneficiaries under § 1396p(d)(4)(A) and (C); these are powerful in the right circumstances but serve different purposes.
Our firm coordinates Florida planning with our colleagues’ deeper bench on irrevocable trust drafting. If you want to understand the mechanics of how these trusts shield assets, the firm’s explainer on the is a useful primer, and the companion piece on the shows how income — not just assets — can be sheltered. The legal principles translate closely, though Florida’s homestead and constitutional protections are uniquely strong.
The Community Spouse: Florida’s Anti-Impoverishment Rules
If you are married and only one spouse needs care, the law does not require the healthy spouse to go broke. Florida’s spousal impoverishment provisions let the community spouse retain a protected share of assets — up to $162,660 for 2026 (the Community Spouse Resource Allowance) — plus a minimum monthly income allowance. With planning, that protected figure can often be increased. This is one of the most underused tools I see, and it routinely preserves several hundred thousand dollars for the spouse who stays home.
Estate Recovery: The Bill That Comes After Death
One more reason to plan around the homestead and trusts: Medicaid estate recovery. After a recipient dies, Florida’s Agency for Health Care Administration can seek reimbursement from the probate estate for benefits paid. Florida only recovers against assets that pass through probate — which is precisely why keeping the homestead protected and titling assets to avoid probate (through trusts and proper beneficiary designations) can defeat a recovery claim entirely. A house left exposed in a probate estate is a target; the same house held correctly is not.
Where Estate Planning and Medicaid Planning Meet
For the professionals and physicians I work with, Medicaid planning is rarely a standalone project. It folds into a broader estate plan: a revocable trust to avoid probate, durable powers of attorney with the specific gifting authority a future Medicaid plan will require, a healthcare surrogate, and a will to catch anything left out. A power of attorney without express gifting language, for instance, can quietly sabotage a crisis plan years later when you can no longer sign for yourself. These documents have to be drafted to work together.
If you don’t yet have the foundational documents in place, start there — see our overview of wills and core estate documents — and if a loved one has already passed, our guide to Florida probate explains what estate recovery can and cannot reach. For families weighing trust strategies across state lines, our colleagues’ offers additional depth.
The Honest Bottom Line
Medicaid asset protection in Florida is legal, it is ethical, and it is what the statutes contemplate — Congress built the lookback, the trust exceptions, and the spousal allowances on purpose. What it is not is a last-minute fix. The five-year clock rewards the people who plan while they are healthy and punishes those who wait for the crisis. If you are a Miami professional with a home, a portfolio, and a family you intend to provide for, the time to map this out is now, while every door is still open. Schedule a consultation to build a plan that protects what you’ve earned.
This article is general information about Florida law as of 2026 and is not legal advice. Medicaid figures adjust annually and individual outcomes depend on your specific facts. Consult a Florida elder law or estate planning attorney before acting.
Frequently Asked Questions
How much money can I keep and still qualify for long-term care Medicaid in Florida?
In 2026, a single applicant may keep $2,000 in countable assets and have gross monthly income at or below $2,982. Certain assets — your homestead, one car, personal belongings, and an irrevocable prepaid funeral — are exempt and don’t count. A married couple with only one spouse needing care can protect up to $162,660 for the community spouse plus a separate income allowance.
What is the Florida Medicaid five-year lookback period?
When you apply for institutional Medicaid, Florida reviews the prior 60 months of your finances. Uncompensated gifts or below-market transfers during that window create a penalty period of ineligibility, calculated using the 2026 divisor of $10,645. Transfers made more than five years before you apply are not penalized, which is why planning early is so valuable.
Do I need a Qualified Income Trust if my income is too high?
Yes. Because Florida is an income-cap state, anyone whose gross monthly income exceeds $2,982 in 2026 must use a Qualified Income Trust (Miller Trust) to qualify. The trust must be irrevocable, funded every month, and name the State of Florida as residual beneficiary. It solves only the income test — it does not protect your home or other assets.
Will Florida take my house to repay Medicaid after I die?
Florida’s estate recovery program only reaches assets that pass through probate. Your homestead is constitutionally protected during life, and with proper titling, trusts, and beneficiary designations it can avoid probate entirely — defeating a recovery claim. A home left exposed in a probate estate, by contrast, can be a target. Planning the title structure is what makes the difference.
Can I just give my assets to my children to qualify?
Outright gifting is usually the wrong move. Gifts within the five-year lookback trigger a penalty delaying your coverage, often at the worst possible moment. A properly drafted Medicaid Asset Protection Trust, funded outside the lookback window, achieves the goal while preserving certain rights for you and avoiding the loss of control and tax problems that raw gifting creates.
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