You spent a lifetime building your assets. A home. Savings. Perhaps a rental property or two. Now you are watching the cost of nursing home care in Maryland, averaging over $100,000 per year, and asking the question that keeps elder law attorneys busy: is there any way to protect what I have built while still qualifying for Medicaid if I need long term care?

The answer, for clients who plan early enough, is yes. The primary tool is the Medicaid Asset Protection Trust, commonly called a MAPT.

Why a Revocable Trust Does Not Solve This Problem

The threshold issue in Medicaid planning is the distinction between countable and non-countable assets. Medicaid is a means tested program, eligibility depends on your assets falling below a threshold that, for Maryland’s Medicaid Waiver and nursing facility programs, is extremely low for an individual applicant.

A revocable living trust does not help here. Because you retain the right to revoke the trust and reclaim the assets, Medicaid treats those assets as fully available to you. They are counted against you on a benefits application as if the trust did not exist. The name “trust” provides no protection whatsoever if revocability remains.

What Makes a MAPT Different

A Medicaid Asset Protection Trust is an irrevocable trust, meaning once it is signed and funded, you cannot take the assets back. You surrender legal control over the contributed assets, giving the key to a trusted individual acting as Trustee. Because you no longer have a legal right to access those assets, Medicaid cannot count them against you on a benefits application.

The practical mechanics work as follows. You, the Grantor, create the MAPT and name a trusted adult child, sibling, or other individual as Trustee. You transfer assets into the trust: commonly the family home, investment accounts, or other non-retirement assets. You name yourself as a Lifetime Beneficiary for income generated by the trust (though not principal), and your children or other loved ones as Residuary Beneficiaries to receive the assets remaining in the trust at your death.

The Five Year Look-Back: Why Timing Is Everything

The single most important fact about MAPT planning is this: Maryland Medicaid applies a five year look-back period to asset transfers. When you apply for Medicaid long term care benefits, the state reviews every transfer you made in the prior five years. Transfers made for less than fair market value, including transfers to a MAPT, are treated as disqualifying transfers that create a penalty period during which you are ineligible for benefits.

This means a MAPT must be funded at least five years before you need Medicaid. It is a planning tool for people who are healthy enough today to look ahead, not a crisis intervention for someone already in a nursing facility. The client who comes in at 65 with a $400,000 home and good health can protect that asset through a MAPT. The client who comes in at 82 already needing nursing care has far fewer options.

The lesson is unambiguous: the time to plan is now, not when the crisis arrives.

What Assets Should Go Into a MAPT

The most common asset transferred into a MAPT is the primary residence. Maryland Medicaid treats the primary home as a non-countable asset during a Medicaid recipient’s lifetime (if a spouse or dependent relative lives there), but the state may assert an estate recovery claim against the home after death to recoup benefits paid. Transferring the home into a MAPT, before the look-back period, protects it from estate recovery and preserves it for the next generation.

Real estate investors and property owners with rental portfolios face additional planning complexity. Rental properties generate income, which can affect both Medicaid eligibility calculations and trust design. The MAPT must be drafted to address how rental income is handled, whether the Grantor retains an income interest, and how property management authority is allocated to the Trustee. This is not a document you want drafted without experienced elder law counsel.

Retirement accounts generally cannot be transferred into a MAPT without triggering income tax, so they are typically addressed through separate planning strategies.

What You Retain as Grantor

Surrendering legal control does not mean surrendering everything. A well drafted MAPT typically preserves:

• The right to live in and use the home transferred to the trust for the remainder of your life (a retained life estate or similar provision).
• The right to receive income generated by trust assets.
• The ability to direct how assets are ultimately distributed among your named beneficiaries, within the trust terms.
• The ability to change Trustees if a named Trustee becomes unwilling or unable to serve.

What you give up is the right to demand the principal back, and that surrender is precisely what makes the trust work.

The MAPT and Your Estate Plan

A MAPT does not replace your other estate planning documents. It operates alongside them. You still need a will to address any assets that remain outside the trust. You still need a durable power of attorney so a trusted agent can manage your affairs if you become incapacitated before or after the MAPT is funded. You still need an advance medical directive. And you need a Successor Trustee designation inside the MAPT itself so trust administration continues seamlessly if your named Trustee cannot serve.

VA Planning: A Parallel Tool for Veterans

Veterans and surviving spouses of veterans have access to a parallel planning vehicle: the Veterans Asset Protection Trust (VAPT), designed to help meet the asset and income requirements for VA Aid and Attendance benefits. The VA’s look-back period is three years, shorter than Medicaid’s five year window, making earlier planning even more valuable for veteran clients. If your family includes a veteran with long term care needs, VA benefit planning should run concurrently with Medicaid planning.

Special Needs Planning: Protecting Disabled Beneficiaries

If any of your intended beneficiaries receive or may receive Supplemental Security Income, Medicaid, or other means tested public benefits, an outright inheritance, even from a MAPT, could disqualify them. Assets passing to a disabled beneficiary should flow into a Special Needs Trust (SNT) rather than directly to that individual. A complete elder law plan accounts for the needs of every beneficiary, not just the Grantor.

The Stakes Are High

Nursing home care in Maryland costs between $9,000 and $12,000 per month or more depending on level of care and facility. A two year nursing home stay can consume $200,000 to $250,000 of assets that took decades to accumulate. A properly funded MAPT, established with adequate lead time, can protect the family home and other non-retirement assets from that exposure entirely.

The five year look-back makes delay costly. Every year of inaction is a year of potential protection lost.

What to Do Next

If you are over 55, own a home or other significant assets, and have not yet addressed long term care planning, the time for a consultation is now, not when the diagnosis comes, and not when the nursing facility sends the first invoice.

Related pages

• Maryland Estate Planning
• A Maryland Homeowner’s Estate Planning Guide
• Estate Administration & Probate

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Blackridge Advisors LLC handles elder law and estate planning for Maryland families, including Medicaid Asset Protection Trust drafting, VA benefit planning, and Special Needs Trust design. Contact us at 443-295-3202 or ddouglas@blackridgeadvisors.com to schedule a consultation.

Blackridge Advisors LLC  |  7939 Honeygo Blvd, Ste 116, Nottingham, MD  |  443-295-3202  |  ddouglas@blackridgeadvisors.com

This article is provided for general informational purposes only and does not constitute legal advice. Reading it or contacting Blackridge Advisors LLC does not create an attorney client relationship.