Medicaid Coverage of Nursing Home Care

Eligibility for Medicaid nursing home coverage

Medicaid is a federal government program that pays long-term nursing home costs for people with low income and few assets (other than a house they own). Each state administers its own Medicaid program, with slightly different eligibility rules. Note also that Medicaid offers separate coverage for medical care. And in some states, Medicaid pays some of the cost of assisted living for eligible residents in participating facilities.

Medicaid nursing home coverage is available only to people who are unable to care for themselves at home. They must also meet their state's eligibility limits regarding income and assets, which differ depending on whether the resident is single or part of a married couple (see below). They may reside in any level nursing home that's certified by Medicaid and that accepts Medicaid payment. Be aware, however, that some nursing homes only accept Medicaid payment for a limited number of residents.

Unlike Medicare coverage for nursing home care, there's no Medicaid requirement of a prior hospital stay, no restriction to skilled nursing facilities, and no requirement that the person need skilled nursing care or still be recovering from an illness or injury in order for Medicaid to continue coverage. In other words, Medicaid -- unlike Medicare -- will cover residence in a nursing home purely to provide help with the nonmedical activities of daily living -- what's called "custodial care."

Search and Compare Nursing Homes Near You >>

Nursing home costs that Medicaid covers

Covered costs

For eligible beneficiaries, Medicaid pays the full cost of room and board in a nursing facility, plus any therapies that are part of the nursing home's regular resident care. Medicaid's payment also includes personal care items such as incontinence supplies and toiletries, as well as services such as bathing, grooming, and laundry.

There's no time limit on Medicaid nursing home coverage. And the Medicaid beneficiary has no co-payments to make.

Income levels for Medicaid nursing home eligibility

The income limits for Medicaid nursing home coverage eligibility are different for a single (unmarried, divorced, or widowed) person than for a married couple.

Income limits for Medicaid nursing home coverage: Single person

State Medicaid programs limit the income of an unmarried nursing home resident in two different ways. One way, used by some state Medicaid programs, establishes a monthly income eligibility limit, which varies from about $300 to $700, after regular medical expenses are deducted. If a Medicaid applicant has income higher than the Medicaid limit in one of these states, that person isn't eligible for Medicaid coverage of nursing home care.

Other states have no income limit but instead require the beneficiary to pay almost all income to the nursing home, with Medicaid paying the balance of the nursing home's charges. In these states, the Medicaid program allows the resident to keep only a small amount -- about $50 to $100 per month -- for personal needs. Some of these states also allow a small amount of income to be retained by the resident for upkeep on the resident's home, usually only for up to one year of admission to the nursing home, and only if a physician certifies that the resident might be able to return home.

Income limits for Medicaid nursing home coverage: Married couple

When one spouse enters a nursing home and the other spouse (often called the "community spouse") remains at home, Medicaid has special income rules for each.

Initial eligibility rules. For initial eligibility for coverage of nursing home care, Medicaid only considers income in the name of the person entering the nursing home. Income in the name of the community spouse is not counted at all -- the community spouse can keep all income in his or her name. (This is sometimes called the "name-on-the-check" rule). The exact amount of the Medicaid applicant's allowable income is determined by the specific Medicaid program in that state but is usually only $300 to $700, after regular medical expenses are deducted.

Post-eligibility rules. Once a married person in a nursing home has become eligible for Medicaid coverage, new income rules kick in. The person in the nursing home can keep only a small monthly allowance for personal needs (in some states as low as $30), plus amounts necessary to pay for uncovered medical costs. Some income that belongs to the spouse in the nursing home -- meaning income in the name of the nursing home resident -- can go to the community spouse if the community spouse's own income doesn't reach the monthly community spouse income allowance. This income allowance for the community spouse is between $1,750 and $2,739, varying from state to state. In other words, if the community spouse's own income is less than the state's income allowance, the nursing home resident's income can go to the community spouse until the combination of incomes reaches the income limit. Any remaining income in the name of the nursing home resident goes to Medicaid, to offset the cost of the nursing home.

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.

  • One automobile.

  • 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.

Medicaid rules on asset transfers prior to nursing home coverage

5-year Medicaid look-back period for asset transfers prior to nursing home coverage

When someone applies for Medicaid coverage of nursing home care, Medicaid examines that person's assets to see if he or she falls below the Medicaid eligibility limit. But Medicaid doesn't simply look at what those assets are at the time of applying. Instead, Medicaid examines the applicant's financial records during the previous five years. If, within that time, the applicant has made a gift of funds or other assets to anyone, that gift will result in a delay of eligibility. The same is true of any asset transferred or sold for less than fair market value -- selling a car worth $20,000 to a grandchild for $5,000, for example.

If Medicaid determines that an applicant for Medicaid nursing home coverage has made an invalid asset transfer, the resulting delay is equal to the amount of the transfer divided by the average monthly nursing home cost in the state. For example, if the amount invalidly transferred was $25,000 and the average monthly nursing home cost in the state is $5,000, Medicaid eligibility would be delayed for five months ($25,000 divided by $5,000 = 5). The coverage delay begins from the date of the application for Medicaid.

Permissible asset transfers under Medicaid nursing home coverage rules

Some gifts or transfers within the five-year period prior to an application for Medicaid nursing home coverage are considered valid and don't result in any coverage delay.

Unmarried person. An unmarried person who applies for Medicaid coverage of nursing home costs can transfer the following assets without any penalty:

  • Home to a child. An unmarried Medicaid applicant can transfer title of his or her home to an adult child who's lived in the home for two years prior to the applicant entering a nursing home, during which time the adult child provided care that permitted the applicant/parent to live at home instead of entering a nursing home.

  • Home to a sibling. An unmarried Medicaid applicant can transfer full title of his or her home to a brother or sister who already has an ownership interest in the home and has lived there for at least the year prior to the Medicaid application.

  • Other exempt assets. An unmarried Medicaid applicant can transfer any other exempt asset -- such as a car or personal and household belongings -- to anyone.

  • Any asset to a blind, disabled, or minor child. An unmarried Medicaid applicant can transfer any asset, including a home, to a blind, disabled, or minor child.

Married person. A married person who applies for Medicaid coverage of nursing home costs can transfer the following assets without any penalty:

  • Home. A married Medicaid applicant can transfer home title to his or her spouse who remains living in the home (the "community spouse"). The community spouse can then, if he or she wants to, transfer title to an adult child or someone else. This double transfer takes the house out of the nursing home resident's estate and therefore is beyond the reach of Medicaid reimbursement when the community spouse dies.

  • Other exempt assets. A married Medicaid applicant can transfer any other exempt asset -- such as a car or personal and household belongings -- to anyone.

  • Any asset to a blind, disabled, or minor child. An unmarried Medicaid applicant can transfer any asset, including a home, to a blind, disabled, or minor child.

Reimbursement to Medicaid for nursing home coverage

Medicaid can seek reimbursement out of the family home

In every state, Medicaid allows a spouse who remains at home (the "community spouse") to keep the house he or she lives in. But once both the nursing home resident and the community spouse die, or the community spouse sells the house, Medicaid will seek reimbursement -- of the total amount it's spent on nursing home care -- out of the value of the house.

Medicaid will seek this reimbursement unless the house has been transferred out of the nursing home resident's name in one of the permissible ways discussed above. The community spouse who sells the house, or the heirs to whom the house is left when both spouses have died, must repay Medicaid the total that Medicaid has spent if they want to keep the house, or they must sell the house and pay Medicaid out of the proceeds of the sale.

Medicaid Questions? Find Government Health Insurance Counselors Near You >>


about 1 month ago, said...

in Oklahoma I'm being told my 87 yr old mother with dementia will have to pay 25% of her bill at [Name Removed]. they are a good facility. but myself and sister also on social security. she has been there since march 2013. can she be exempt from this 25% charge. governor falan of Oklahoma has messed with state budget. what are we to do? too many younger people that can work are on Medicaid. I've worked all my life and this is totally devastating.


4 months ago, said...

My mom is coming to live with me out of her home state because my father cannot care for her. They have no home ownership and minimal assets. Will there be a residential requirement for her to qualify for medicaid or other state services when she arrives at my home next month?


5 months ago, said...

Need a list of nursing homes in Flint, MI 48439 area that accept medicaid. Also; does anyone know Michigan income limit for single person in order to be medicaid approved. Information found says usually states allow 300.00 to 700.00 for a single person of monthly income after medical expenses. My mom makes 1,200 mth social security. Has no home or assets but a load of medical expenses (that are currently paid for by medical, in california. She needs to move to Michigan due to dimensia. How do I deduct medical expenses out of her 1,200 mthly income that are currently already being paid. How does this work. Thank you in advance for any info at all!


7 months ago, said...

My mother is is a assisted living home that is 45 minutes from my home, her medicaid covers her expenses. I am looking for something much closer to my home, I would really appreciate how to facilitate finding which would do the same for her.


8 months ago, said...

Allowing medicaid to help cover senior living expenses is very helpful. Anybody who has had a parent in this situation knows the funds that are required in this situation. Getting government help via medicaid is definitely appreciated. http://genacta.com/services/in-home-support-supported-living/


9 months ago, said...

Curious about the assest transfer statement. In Ohio. Widowed man is currently in Nursing Home. His home is being sold, and will be used to pay for nursing home costs. Is it ok to for his car to be given as a gift or sold for less than it's worth, and that money not be used for the nursing home? Estimating that the money from the home will last him about 3 more years. Thank you!


9 months ago, said...

I need a home nurse to come out just to check and clean my wound


9 months ago, said...

When medicaid starts paying for Nursing Home Care, do they get a reduced rate from the Nursing Home, or is it the same as what a private patient would pay?


10 months ago, said...

My mom has 5,000 for a burial no long term care. And has been in a nursing home for rehab that Medicare paid for we are waiting for Medicaid approval to keep her in the nursing home I am nurse but I can't work 60 hrs a week and take care of her too she has dementia. Has severe rheumatoid arthritis and has fallen several times at my house I pray Medicaid comes through for my mom


10 months ago, said...

Do you have a list of nursing homes in eastern CT that takes Medicaid? My Dad is in a home right now and has to be moved to a facility that takes Medicaid. We have not yet applied for Medicaid because the money he has left is running out and we have to sell his home.


over 1 year ago, said...

My dad is 81 years old has been Dx with schizoprania and paranoid . 3 years ago started showing signs of dementia . He has progressively got worse. He has kaiser and Medicare . I don't think any of this covers a home facility to take care of him. Can anyone give me any advice. He is a veteran but has not used his VA benifits in over 40 years.


over 1 year ago, said...

My mother's been living with me for 10 years. Her dementia is getting worse and I am now fearful of leaving her home alone,as she is also getting weaker and weaker. She has no assets, but does get a small SS and VA benefits for aid and attendence. I was told by an eldercare attorney that her application for DPW for medicaid for a nursing home may be denied, because for the last five years she has given me over $500 a month towards HER expenses. I explained that I pay taxes on the VA money and her SS money is used for her pills, OTC stuff, depends, clothes, shoes, food and to help with heating bills. where else would mom have been able to live for 10 years with this little bit of money. Now I am extremely stressed and don't know what to do. Please help!


over 1 year ago, said...

My Dad is on Medicare due to being disabled. He Lives in AZ can he get Medicaid? That way he is medi-medi and that kind of acts as his secondary insurance. He needs all the help he can get. Also what can he do, the money he gets every month isn't enough to live on forcing him to sale all his property. He has lived with his sister but she is making him leave so her grandaughter can move in.He has looked for work on the work ticket program applied for school and housing grants, no help. If I could help him I would bit i'm barely making it. It sad this recession has hurt tons of people, there homes, businesses, work, savings, all they have left are the clothes they have &a few important picture or what they can hold onto. This entire thing is sad and painful to us and tons of other people, and the kids.(SAD) Thanks for listening any resources in AZ would be appreciated!!!!! Also CA too, thanks. God Bless


almost 2 years ago, said...

I would like to know ,how a nurseing home can get medicaid and still get all of my ssi and penison?


almost 2 years ago, said...

I live in Ca and for the past 3 years I have been taking care of my grandma. she lives with me and I do anything I can for her. I also work a full time job but I recently had to cut my hours so I can take care of her. I was just wondering what steps and qualifications would I need to be her home caregiver?


about 2 years ago, said...

Question, If a couple has gifted their home, and one spouse lives in the home, but the other is in a nursing home, can they apply for Medicaid long term custodial care for the Nursing home spouse?


about 2 years ago, said...

I live in SC, have a sister and her husband living in Oregon. She has COPD so the weather there is detrimental to her health, and her husband has Dementia. Trying to get them moved here, they live in assisted living now, she could manage living in apt for a while or live with me, but they don't have any assets, so they would need to receive financial help. Currently, Oregon is paying for them to stay in assisted living. I have no idea where to start or what to do, any comments or ideas would be appreciated! Is the Medicaid office my first stop and how do I find the requirements for our state?