Contributions by third parties who apply for Medicaid

A third party who has contributed to an ABLE account of someone else may apply for Medicaid and seek coverage of long-term services and supports (LTSS). Section 103 of the ABLE Act does not provide for any special treatment of contributions made to an ABLE account benefiting another person. For example, a contribution from a grandfather to the ABLE account of his grandchild, whether from the grandfather’s income or resources, would constitute a transfer of assets from the grandfather to his grandchild’s account. The transfer may need to be evaluated under the requirements in section 1917(c)(1) of the Act (depending on when the transfer occurred), if the grandfather subsequently seeks Medicaid coverage of LTSS. The amount transferred by the grandfather to his grandchild’s ABLE account would not be an exempt transfer by virtue of section 103 in the determination of the grandfather’s eligibility for Medicaid coverage of LTSS.