Can I protect a 401K from Medicaid

In most instances, the answer is yes. However, there is a proviso. If the 401K is making monthly payments to you or your loved one, then Medicaid will not touch the 401K but the payments will be considered as part of the income stream. If, however, the 401K is not paying out (we refer to it as being annuitized), then your loved one would be over the asset limit. Assuming that the annuity is paying out most states will go after a number of items to seek reimbursement for any Medicaid benefits that the state has paid for prior to death. If there is more money in the annuity than is needed to reimburse the state, the balance will be paid to the named contingent beneficiaries. It is always good practice to consult with a local elder law attorney prior to applying for Medicaid.