Asset levels for Medicaid nursing home eligibility
Asset limits for Medicaid nursing home coverage: Single person
To qualify for Medicaid coverage of nursing home care, an unmarried person is allowed only limited assets. These include a maximum of $2,000 in cash, savings, stocks, or other "liquid" assets; a life insurance policy of up to $1,500 face value; and a burial plot and burial fund of up to $1,500.
In some states, an unmarried person can also keep his or her home if declaring in writing, upon admission to the nursing home, an intent to return home. However, states that permit this usually put a 6- or 12-month limit on the length of time a resident can keep the home without actually returning to it. If a Medicaid nursing home beneficiary is allowed to keep a house, Medicaid will seek reimbursement from the value of the house when it's sold.
WARNING! Medicaid does not allow asset giveaways. In determining how much an applicant for nursing home coverage has in assets, Medicaid examines that person's financial records for the five years prior to the application date and penalizes the applicant for any improper transfers made within that five-year period. See below, "Medicaid rules on asset transfers prior to nursing home coverage."
Asset limits for Medicaid nursing home coverage: Married couple
Medicaid has special nursing home coverage eligibility rules when one spouse enters a nursing home and the other spouse (the "community spouse") remains at home. Medicaid looks at the combined assets of both spouses. From that combined amount, Medicaid allows the community spouse to keep:
The house in which the community spouse lives. (If the couple sells the house, or the community spouse moves out, the value of the house or the proceeds from its sale become part of the couple's combined assets.)
A "Protected Resource Amount" (PRA) for the community spouse of between $21,912 and $109,560 (in 2010). Each state sets its own PRA between those minimum and maximum amounts.
All furniture, appliances, and other household goods.
Life insurance of up to $1,500, face value, for each spouse.
Two burial plots and a burial fund of up to $1,500 for each spouse.
Once these amounts are subtracted from the couple's combined income, all other assets are totaled to determine whether the nursing home spouse is eligible for Medicaid. The asset eligibility limit is set differently by each state.