Income and Assets Eligibility Limits for Medicaid Medical Coverage

How Medicaid Works: Page 3

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How much income is allowed for Medicaid medical coverage?

Medicaid medical coverage is available only to people with very low income. Exactly how much income is permitted depends on the state where you live. In all states, if your income falls below the eligibility standard for the federal government's Supplemental Security Income program, known as SSI, you're also eligible for Medicaid medical coverage. This amount is about $700 per month in what's called "counted" income. But quite a bit of your actual income might not be counted toward this figure. So, if your actual income is up to $1,500 per month, you should consider applying for Medicaid.

If either spouse in a married couple applies for Medicaid, the income of both spouses (if living together) is counted by Medicaid when deciding eligibility. Also, if a Medicaid applicant receives free housing and regular meals from family or friends, or has bills regularly paid for them, Medicaid may consider this as income when deciding eligibility.

In many states, Medicaid medical care coverage is also available to people whose income is higher than the state's Medicaid eligibility level if they also have regular medical expenses that aren't paid by another program or insurance. This category of people is known as "medically needy." So if you have any regular medical bills that aren't covered by Medicare or other insurance, you may be eligible for Medicaid coverage even if your income is well over the normal Medicaid limit.

How much in assets is allowed for Medicaid medical care coverage?

Someone applying for Medicaid medical coverage is allowed $2,000 ($3,000 for a couple) in cash, savings, or other assets, plus a number of other assets that are "exempt" (not counted) from Medicaid eligibility rules. These exempt assets include:

  • A house that the applicant lives in.
  • An automobile, sometimes limited to a certain fair-market resale value of around $5,000 (this varies from state to state).
  • Personal property and household goods for regular daily use, sometimes limited to a certain fair-market resale value (this varies from state to state).
  • Wedding and engagement rings.
  • Life insurance with a total face value (cash surrender) of no more than $1,500, and term life insurance with no cash surrender value.
  • Specially earmarked funeral and burial fund of up to $1,500, plus a burial space.

A person who wants to apply for Medicaid medical coverage can give away or transfer any amount of assets in order to qualify. Medicaid medical coverage eligibility doesn't have any of the rules or penalties regarding transfer of assets that apply to Medicaid nursing home coverage.