How is Pennsylvania’s Medicaid Transfer Penalty Calculated in 2024?

The Pennsylvania Department of Human Services released its 2024 “MA LTC Eligibility Fact Sheet” which sets forth various inflation adjusted numbers that are used to determine when an applicant is eligible (and ineligible) for Medicaid long-term care benefits. In addition to the usual inflation adjustments, we have a surprise with the 2024 Medicaid numbers, specifically with the 2024 transfer penalty divisor.   

The daily transfer penalty divisor was not increased in 2024 to reflect rising costs of nursing home care but was instead decreased for the second year in a row despite headlines of inflation across other sectors of our economy. The transfer penalty will be $379.65/day for applications filed in 2024, down from $423.11/day for applications filed in 2023. The 2022 daily penalty divisor was $482.50/day. 

With widespread reports of inflation across all sectors of the economy, this year’s revision comes as a surprise and has left some elder law attorneys wondering exactly how the daily transfer penalty is calculated. Seeing the average cost of nursing home care reduced two years in a row is doubly surprising.   

For those unfamiliar, the daily transfer penalty divisor is updated each year, and is used by elder law attorneys and caseworkers at Pennsylvania’s County Assistance Offices to compute periods of ineligibility for Medicaid applicants who made non-exempt gifts and asset transfers within the five-year Medicaid lookback period. The “lookback period” is the 60-month window preceding the date an application is filed for Medicaid long-term care benefits. 

A lower daily penalty divisor increases the period applicants for Medicaid long-term care benefits will be determined ineligible due to gifts and asset transfers that occurred within the 5-year look-back prior to the filing of the Medicaid application. To illustrate the effect of transfer penalty divisor changes over the past five years, $50,000 of non-exempt gifting within the lookback would have created the following periods of ineligibility for Medicaid long-term care benefits:

Application filed in 2020: $50,000 divided by $352.86 = 141 days of ineligibility

Application filed in 2021: $50,000 divided by $364.90 = 137 days of ineligibility

Application filed in 2022: $50,000 divided by $482.50 = 103 days of ineligibility

Application filed in 2023: $50,000 divided by $423.11 = 118 days of ineligibility

Application filed in 2024: $50,000 divided by $379.65 = 131 days of ineligibility

The applicable transfer penalty divisor is the one in effect as of the date the Medicaid application is filed with the County Assistance Office, not the transfer penalty in effect when the County Assistance Office issues its determination notice. For example, an application filed in December 2023 should use the 2023 transfer penalty divisor of $423.11/day, even if the County Assistance Office caseworker does not issue their determination notice until February 2024. The next revision of Pennsylvania’s Medicaid transfer penalty divisor will occur in January 2025.  

Having an advocate to guide you through the Medicaid application process will save you time and avoid mistakes. During an already stressful time, consider hiring an attorney who is an expert in the Medicaid process. You can rely on the lawyers at Gerhard & Gerhard, P.C.  to be on your side every step of the way.

Disclaimer: We recommend that you receive ongoing legal advice from an elder law attorney before attempting to navigate the Medicaid application process. If you have questions or wish to secure our services, please contact us.

Print Friendly, PDF & Email

Still unsure, need more direction?

We've been working with people just like you for years to help navigate the long term care system and qualify for Medicaid long-term care benefits. Let us clear things up and help you feel confident about your and your family's future.