New Hampshire Medicaid Asset Protection Trust: How Irrevocable Trusts Work

A Medicaid Asset Protection Trust — sometimes called a MAPT or an irrevocable Medicaid trust — is one of the few planning tools that can definitively protect a family home or savings account from both Medicaid asset calculations and New Hampshire's expanded estate recovery. But it only works if you start well before a care crisis.

What an Irrevocable Medicaid Trust Does

A Medicaid Asset Protection Trust is an irrevocable trust created by your parent (the "grantor") during their lifetime. Your parent transfers assets — typically the family home, sometimes investments — into the trust. Once transferred, those assets no longer belong to your parent; they belong to the trust. The trust is managed by a trustee (often an adult child) for the benefit of named beneficiaries.

Because your parent no longer owns the assets, those assets are not counted for Medicaid eligibility purposes — and because the trust is irrevocable and was not created to be revocable at the grantor's death, New Hampshire's expanded estate recovery definition under RSA 167:14-a does not reach them either.

The trust can be structured so your parent continues to live in the home — they can retain a right of occupancy even after the home is transferred. They do not retain any ownership interest or the right to revoke the trust or take the assets back, which is what makes the planning work.

The 60-Month Lookback Requirement

The critical constraint is timing. Transferring assets to a MAPT triggers the same 60-month lookback rules that apply to any other Medicaid transfer. The transfer is an uncompensated gift from your parent to the trust — and the BFA will calculate a transfer penalty if the MAPT is funded within five years of the Medicaid application.

The penalty formula: transfer value ÷ $13,000 (the average monthly nursing home rate) = penalty months. A home worth $390,000 transferred to a MAPT two years before the application creates a 30-month penalty during which Medicaid won't pay.

This means a MAPT is a proactive planning tool, not a crisis response. The ideal scenario is a parent in their late 60s or early 70s, in reasonably good health, who establishes the trust and transfers the home. Five years later, if they need Medicaid long-term care, the home is fully protected.

For families already in a care crisis, a MAPT is generally not viable — the lookback period can't be satisfied.

Why Revocable Living Trusts Don't Work in New Hampshire

Families often establish revocable living trusts for probate avoidance, then assume those trusts also protect assets from Medicaid. They don't.

Under RSA 167:14-a and New Hampshire's expanded estate recovery rules, all real and personal property held in a revocable trust is fully subject to Medicaid estate recovery. A revocable trust is treated as indistinguishable from the grantor's own estate because the grantor retains the right to revoke it.

An irrevocable trust established and funded outside the lookback window is different: your parent has surrendered control, the trust genuinely holds the asset, and the expanded estate definition does not reach it.

What Can Be Placed in a MAPT

Any asset can theoretically go into a MAPT, but in practice most families transfer:

The family home. This is the most common MAPT asset in New Hampshire — it's typically the family's largest asset and carries the highest estate recovery exposure. The parent retains a right of occupancy under the trust terms.

Investment accounts and savings. Transferring liquid assets creates a larger lookback exposure (the full value creates a larger penalty) and also means your parent loses access to those funds. Most families balance this against how much they can tolerate losing access to.

Vacation property or rental real estate. Non-primary real estate has no exempt status and is fully subject to Medicaid asset calculations and estate recovery. A MAPT can protect these assets with the same lookback constraint.

What a MAPT Cannot Do

• It cannot be undone. If your parent changes their mind, needs the assets back, or wants to sell the house without trust consent, the irrevocability is a problem. Any sale of the property requires trustee approval and must comply with trust terms.
• It does not generate a Medicaid spend-down. The transfer doesn't help your parent spend down assets they still hold. Only assets inside the trust are protected.
• It does not eliminate the lookback period. The 60-month clock starts on the date of transfer. Nothing accelerates it.

When to Use a MAPT vs. Other Strategies

• MAPT: Best for families with 5+ years of lead time. Protects the home permanently from both asset calculations and estate recovery.
• Caregiver Child Exception: Available now, during a crisis, if an adult child has lived in the home providing care for at least two years. No lookback exposure and no trust required.
• CFI Waiver Spousal Retitling: Available immediately for married couples where CFI home-based care is the goal. No trust required.
• Irrevocable Funeral Trust: Can be funded during a crisis as a spend-down strategy. Protects a specific asset (burial funds) without lookback exposure.

For New Hampshire families with a parent in good health but a family history of dementia or care needs, a MAPT conversation with an elder law attorney should happen now — not when the diagnosis arrives. The New Hampshire Medicaid Long-Term Care & Asset Protection Guide explains the trust structure, what the attorney drafting process involves, and how to evaluate whether your family's timeline makes a MAPT viable.

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