Purpose: This study examines whether the relationship between making familial wealth transfers and becoming a Medicaid recipient sheds light on the current debate about Medicaid estate planning, whereby some elders transfer their assets to their families to qualify for Medicaid. Design and Methods: Using the Health and Retirement Study, we tracked a national sample of community-based elders who did not receive Medicaid at the 1993 baseline interview but became Medicaid recipients during a 10-year time period and examined wealth transfers for these new Medicaid beneficiaries. Results: Among elders aged 70 or older who did not receive Medicaid in 1993, 16.4% became Medicaid recipients over 10 years. Among these new Medicaid recipients, 17.9% transferred their wealth to family members before receiving Medicaid benefits, with an average transfer amount of $8,507 during the 2 years prior to receiving Medicaid benefits. In addition, 15.2% of community-residing elders entered a nursing home during the 10-year period, and 26.3% of these were covered by Medicaid. Of these new Medicaid recipients living in nursing homes, 12.6% transferred wealth to their families in the mean amount of $4,112. Implications: Familial wealth transfers do occur before changes in Medicaid eligibility in a small, but nontrivial, number of cases, but the amount transferred is modest, especially among nursing home residents. This finding implies that policies to reduce Medicaid long-term-care expenditures by limiting such transfers may not be very effective. (Contains 3 tables.)