Medicaid Planning Lawyer in Houston, Texas

Quick Answer

Most families don’t think about Medicaid planning until long-term care is already on the horizon. By then, the rules can be confusing and the cost of care can be overwhelming. With the right planning, you may be able to qualify for Medicaid while protecting more of what you’ve worked hard to build. We help Houston families understand their options and plan ahead with confidence.

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Medicaid Planning Lawyer in Houston, Texas

Most Houston families learn how Medicaid actually works the year a parent enters a nursing home. They learn that Medicare doesn’t cover long-term care. They learn that the family’s savings are about to be spent down at $9,000 a month until they qualify for Texas Medicaid. They learn that the home is exempt during life but exposed to estate recovery at death. They learn the words “five-year lookback” and find out, too late, that the gifting they did three years ago to help a grandchild with college is now triggering a transfer penalty.

The families who learn these things five years before they need them rarely lose their savings. The families who learn them five months before pay for the lessons in the form of an inheritance that disappears.

Medicaid planning is the legal work of qualifying a Texas resident for long-term care Medicaid while preserving as much of the family’s assets as the law allows. Done at least five years before any Medicaid application, the planning is comprehensive — Medicaid Asset Protection Trusts, gifting strategies, properly structured spousal protections, Lady Bird deeds, and coordinated estate planning that protects nearly everything the family has built. Done in the middle of a crisis, the planning is narrower — but still meaningful, and still worth far more than what it costs.

Your Legacy Legal Care® has been doing Medicaid planning for Houston families for over 20 years. Attorney Kim Hegwood is a Certified Dementia Practitioner and a member of the National Academy of Elder Law Attorneys. We file Medicaid applications regularly with Texas HHSC and know what the agency actually expects to see. The firm holds the Houston Chronicle’s Best Trust & Estate Law Firm award and operates from five offices across Greater Houston.

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Without planning, families typically pay privately for long-term care until their assets are exhausted, then apply for Medicaid. With planning, the same family can qualify for Medicaid much faster, preserve the home and a substantial portion of liquid assets, and protect the well spouse from impoverishment.

The work involves several distinct planning structures, used in combination depending on the family’s situation and timeline:

Medicaid Asset Protection Trusts (MAPTs) — irrevocable trusts funded at least five years before any Medicaid application, removing the assets from the applicant’s estate while preserving them for the family.

Lady Bird deeds — enhanced life estate deeds that transfer the family home at death without affecting Medicaid eligibility during life or triggering Medicaid Estate Recovery Program (MERP) claims at death.

Spousal protection planning — using the Community Spouse Resource Allowance, the Minimum Monthly Maintenance Needs Allowance, and Texas-specific rules to maximize what the well spouse keeps.

Medicaid-compliant annuities — converting countable assets into an income stream for the well spouse, typically used in crisis planning.

Gift-and-loan strategies — combining a gift of part of the assets with a Medicaid-compliant promissory note for the remainder, calibrated to produce a calculated penalty period the family can pay through.

Caregiver agreements — properly documented contracts compensating adult children for care provided to a parent, preventing the payments from being characterized as gifts.

Qualified Income Trusts — required when the applicant’s monthly income exceeds the Medicaid income cap (roughly $2,901/month in 2026).

Strategic spend-down on exempt assets — paying off debts, prepaying funeral arrangements, making necessary home repairs, replacing a vehicle.

The right combination depends on whether the applicant is single or married, the size and composition of the assets, the timeline before Medicaid is needed, and the family’s risk tolerance.

How to Avoid the Medicaid Five-Year Lookback in Texas

The five-year lookback is the rule that defines proactive Medicaid planning. When a Texas resident applies for long-term care Medicaid, HHSC reviews all asset transfers from the previous 60 months. Any uncompensated transfer (a gift, a sale below fair market value, money sent to a family member) triggers a transfer penalty — a calculated period during which the applicant is ineligible for Medicaid coverage.

The penalty period is calculated by dividing the total uncompensated transfer amount by Texas’s average monthly nursing facility rate (approximately $7,800 in 2026, recalculated annually). A $78,000 gift made within the lookback period creates roughly a 10-month penalty — meaning the applicant is ineligible for Medicaid coverage for the first 10 months they otherwise would have qualified.

The honest answer to “how do I avoid the lookback” is: complete your transfers more than five years before you apply. Assets transferred more than 60 months before the Medicaid application are outside the lookback entirely and don’t trigger any penalty.

For families starting at least five years out, the planning is straightforward. The Medicaid Asset Protection Trust is funded with the assets the family wants to preserve — typically the home (using a Lady Bird deed-style structure within the trust), liquid investments, and any other non-retirement assets. Five years pass. The applicant qualifies for Medicaid with the protected assets outside the calculation entirely.

For families starting inside the five-year window, the strategies are different and more limited — see our page on Medicaid Crisis Planning for the tools that work even in the middle of an active care situation.

What Is a Medicaid Asset Protection Trust?

A Medicaid Asset Protection Trust (MAPT) is an irrevocable trust specifically designed to hold assets outside the grantor’s estate for Medicaid purposes while preserving them for the family. The grantor (often together with their spouse) transfers assets to the trust, typically names children or grandchildren as beneficiaries, and gives up the right to revoke the trust or reach the principal.

Key features of a properly drafted Texas MAPT:

The trust is irrevocable. The grantor cannot reclaim the assets. This is the central tradeoff — the grantor parts with control to gain the protection.

The grantor retains an income interest. Many MAPTs allow the grantor to receive the income generated by trust assets during their lifetime, while the principal is preserved for the next generation.

The grantor retains the right to live in trust-owned real property. When the family home is funded into the trust, the grantor typically retains a life estate or similar right of occupancy — they continue to live in the home as before.

The grantor retains certain limited powers to preserve favorable income tax treatment, including a “step-up in basis” at death for assets held in the trust. The drafting matters enormously here — get it wrong and the family loses substantial capital gains tax benefits.

The trust is funded at least five years before any Medicaid application. Assets transferred to the MAPT during the five-year lookback are subject to transfer penalties; assets transferred earlier are not.

The trust is not the same as a revocable living trust. Revocable trusts offer no Medicaid protection because the grantor still controls the assets. Medicaid treats them as still owned by the grantor for eligibility purposes.

For Houston families with a primary residence, modest investment accounts, and a desire to preserve their estate for the next generation, the MAPT is often the central planning structure.

How Much Does Medicaid Planning Cost in Houston?

Costs vary based on the complexity of the situation and the timeline.

A standard proactive Medicaid plan — a Medicaid Asset Protection Trust, supporting documents, asset funding, and coordination with the broader estate plan — typically runs $8,000 to $10,000 in flat attorney fees. This is the comprehensive plan for families starting at least five years before Medicaid is anticipated.

Crisis Medicaid planning — for families with a parent already in a facility or about to enter one — typically runs $7,500 to $15,000+, reflecting the more technical work required (Medicaid-compliant annuities, gift-and-loan structures, expedited application preparation, coordination with HHSC).

Lady Bird deeds, when prepared as standalone documents (often for families who have everything else in place but need to address the home), typically run $1,200.

The savings from proper Medicaid planning generally run from $50,000 to several hundred thousand dollars in preserved assets. In nearly every case, the planning fee is a small fraction of what the family would otherwise spend on private-pay care or lose to estate recovery.

Our firm provides flat-fee quotes in writing before the engagement begins.

What Texas Medicaid Will and Won’t Cover

Texas Medicaid covers nursing facility care indefinitely for qualifying residents. The benefit has no time limit (unlike Medicare’s 100-day skilled nursing facility benefit), no annual cap, and continues as long as the resident continues to meet medical and financial eligibility.

Texas Medicaid also covers community-based long-term care services through several distinct programs, each with its own eligibility rules and waiting lists:

STAR+PLUS — managed care program covering long-term services and supports for adults with disabilities and seniors, including community-based services that can delay or avoid nursing facility placement.

Home and Community-Based Services (HCS) waiver — services for individuals with intellectual or developmental disabilities living in the community.

Texas Home Living (TxHmL) — limited services for individuals with IDD who live with family.

Community Living Assistance and Support Services (CLASS) waiver — services for individuals with related conditions other than intellectual disability.

Community-Based Alternatives (CBA) — community services for adults requiring nursing facility level of care.

Some of these waiver programs have multi-year waiting lists. Families with disabled children or grandchildren who may eventually need these services should apply early — sometimes years before the services are actually needed.

Texas Medicaid does not cover most assisted living facility care directly, though some assisted living costs may be covered through specific waiver programs or through dual-eligible Medicare-Medicaid arrangements for qualifying individuals.

What the Texas Homestead Exemption Does for Medicaid Planning

The Texas homestead exemption is one of the strongest in the country, and it interacts with Medicaid in ways that benefit Houston families significantly.

The home is generally not a countable resource for Texas Medicaid eligibility purposes, regardless of equity value. An applicant can own a home worth $1 million and still qualify for Medicaid, as long as the applicant or their spouse, minor child, or disabled child is living in it (or it’s reasonably expected they’ll return).[a]

The home is not subject to forced sale during the applicant’s life under Texas law, with limited exceptions for specific purchase money obligations and certain other claims.

The home may be exposed to Medicaid Estate Recovery Program (MERP) claims at death. Federal law requires Texas to seek recovery from the estates of deceased Medicaid recipients who received long-term care services after age 55. In Texas, MERP claims attach only to assets that pass through probate.

A properly recorded Lady Bird deed prevents MERP recovery on the home. The deed transfers the home at death without probate, which means MERP cannot reach it. We file Lady Bird deeds as a routine part of Medicaid planning for Houston families with significant home equity.

The combination of homestead exemption during life and Lady Bird deed at death keeps the family home outside the Medicaid system entirely — preserving it for the next generation regardless of how long the parent received Medicaid coverage.

When Houston Families Should Start Medicaid Planning

The textbook trigger is age 55 or older. The realistic triggers we see most often:

Houston — Main Office

• Address:1150 Clear Lake City Blvd., Suite 100 Houston, TX 77062
• Hours: M-F 9:00 A.M.-5 P.M.
• Phone:(281) 218-0880

Katy

• Address:10810 Katy Fwy #102, Houston, TX 77043
• Hours: M-F 9:00 A.M.-5 P.M.
• Phone:(281) 218-0880

Bay City

• Address:2232 Avenue G Ste 100, Bay City, TX 77414
• Hours: M-F 9:00 A.M.-5 P.M.
• Phone:(281) 218-0880

Sugar Land

• Address:120 Eldridge Rd Ste A, Sugar Land, TX 77478
• Hours: M-F 9:00 A.M.-5 P.M.
• Phone:(281) 218-0880

A parent has been diagnosed with a progressive condition (Alzheimer’s, dementia, Parkinson’s, ALS, multiple sclerosis) — the planning window is now, while capacity remains and the five-year lookback hasn’t started.

The family’s financial situation has reached a point where the next major event will determine whether the inheritance is preserved or spent on care.

A long-term care insurance application has been declined for health reasons, eliminating that option.

The parents have just watched a friend or relative go through a Medicaid spend-down and decided they’re not letting it happen to their own family.

A spouse has been diagnosed with a condition likely to require care, and the healthy spouse needs to understand the protections available.

The parents are turning 65 and the conversation about “what if one of you can’t take care of the other” is happening for the first time.

If any of these is true, the planning conversation is worth having now. Five years passes faster than most families expect, and the difference between starting today and starting next year is often $50,000 or more in eventually preserved assets.

Why Houston Families Choose Your Legacy Legal Care®

Medicaid planning is one of the practice areas where the difference between an experienced Texas Medicaid attorney and a general estate planning lawyer shows up most starkly. The rules are state-specific, they change frequently, and HHSC has internal practices that don’t always match what’s in the public manual. Filings that look fine on paper get denied for reasons specific to how Texas administers the program.

We’ve been doing this work in Houston for over 20 years. Our Medicaid paralegal handles applications and case management directly with HHSC. Attorney Kim Hegwood holds the Certified Dementia Practitioner designation and is a NAELA member. The firm holds the Houston Chronicle’s Best Trust & Estate Law Firm award.

We operate from five offices across Greater Houston: Clear Lake, the Galleria, Katy, Bay City, and Sugar Land. Most engagements are quoted as a flat fee in writing before the work begins.

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Five offices serving the Greater Houston area and clients across Texas.