Overview of Eligibility Requirements for Medicaid Long Term Care

Summary
Medicaid Long Term Care eligibility is complicated because the requirements are updated annually or biannually, and they can change depending on what state you live in, your marital status and if your spouse is also applying. The criteria can also change for each of the three Medicaid Long Term Care programs. While this page provides an overview of the eligibility requirements, the easiest way to find information specific to your situation is to use our Medicaid Eligibility Requirements Finder tool.

Table of Contents

Medicaid Eligibility Requirements

There are three types of Medicaid programs that cover long-term care for seniors: Nursing Home Medicaid, Home and Community Based Services (HCBS) Waivers and Aged, Blind and Disabled (ABD) Medicaid. Regardless of the type of Medicaid, all programs consider two major factors: financial need and medical need. However, the financial criteria and the medical need criteria vary with the type of Medicaid program.

Age as a Qualifying Factor – It is worth noting that age does not impact the dollar limits for Medicaid Long Term Care eligibility but rather can be a qualifying factor for a specific program. As an example, there will not be different income limits for persons over and under 65 years of age, rather a Medicaid program is simply not open to persons under 65.

Financial Criteria

Three factors are considered when determining if an applicant is financially qualified for Medicaid Long Term Care; 1) their income, 2) their assets and 3) the value of their home equity. However, each of the three types of Medicaid Long Term Care program has different values for these limits. Furthermore, the limits change based if an applicant is married or single and if one or both spouses are applying for Medicaid assistance.

The reason that different Medicaid programs have different values is that different Medicaid programs provide assistance in different locations. Persons residing in a nursing home have very different financial needs than individuals living at home.

The reason the values change based on marital status and number of applicants is because one’s financial needs change based on their marital status. For example, a single widower in a nursing home has very different monetary needs than a married couple in which one spouse resides in an Alzheimer’s care home while the other spouse lives independently in the couple’s long-time home.

Income Rules
Married couples’ incomes are counted separately provided both spouses are not applying for Medicaid. If only one spouse is an applicant or if the applicant is single, only their income is counted. The following sources are considered income.

– Alimony
– Dividends from bonds and stocks
– Employment wages
– Estate income
– Interest payments
– IRA distributions
– Pension payments
– Social Security benefits
– Veteran’s benefits (varies by state)

For all types of Medicaid, applicants and beneficiaries are permitted a monthly income. Across state and across Medicaid program, these figures vary. A rule of thumb is that the monthly income limit is between 100% and 300% of the federal poverty level. For 2024, the federal poverty income number is $943/month, and 300% of that is $2,829/month. For state-specific Medicaid eligibility numbers, use our Medicaid Eligibility Requirements Finder. It should also be noted that Nursing Home Medicaid beneficiaries are required to give almost all of their income to the state to help pay for the cost of nursing home care.

For married couples, a non-applicant spouse (also called the community spouse) may be allocated some of the applicant/beneficiary spouse’s income so they can continue living at home or somewhere else in the community. This is called the Monthly Maintenance Needs Allowance (MMNA). If the community spouse has income below the state MMNA limit (which ranges from $2,555 – $3,853.50/month in most states as of July 1, 2024), the applicant/beneficiary spouse can transfer as much of their income as is necessary to push the community spouse’s income up to the state’s MMNA. This transferred income does not count toward the applicant/beneficiary’s income limit, so the MMNA can also be used as a way to help seniors qualify for Medicaid Long Term Care.

Asset Rules
In most cases, all of a married couple’s assets are considered joint assets. This is true for a home (more on home equity below) or any asset regardless of in whose name the asset is held. There are Exempt and Non-Exempt Assets. The following assets are counted (non-exempt).

– Cash
– Certificates of deposit
– Stocks & bonds
– Vacation properties
– Any other liquid assets that can be easily converted to cash.

Assets not counted include a primary home (more on home exemptions below), furniture & appliances, clothing, a car, irrevocable funeral trusts, and life insurance policies (with a face value under $1,500 in most states).

In most cases in 2024, single Medicaid Long Term Care applicants are permitted countable assets valued up to $2,000 and married couples with both spouses applying are permitted a combined $3,000 or $4,000. However, this varies by state. For example, the 2024 asset limits in New York for all three types of Medicaid Long Term Care are $31,175 for an individual and $42,312 for a married couple, and in California there are no asset limits.

The rules for married couples with only one spouse applying for Medicaid can be even more complicated, but for in general in 2024 for Nursing Home Medicaid and HCBS Waivers, non-applicant spouses with limited resources of their own are allowed to keep up to $154,140 of the couples assets, while the applicant spouse is allowed $2,000, or whatever the asset limit is for an individual in their state of residence. This is due to the Community Spouse Resource Allowance (CSRA). Please note that the CSRA does not apply to ABD Medicaid.

Attention: Assets cannot be given away or sold under market value in an effort to reach the asset limit and asset transfers as far back as 5 years preceding the application date are reviewed. This is called the Look-Back Period, which you can learn more about by clicking here.

Home Equity Rules
In most cases and in most states, your home will not be counted toward the asset limit, as long as it is under the home equity interest limit in your state. Home equity interest is the portion of the home’s equity value that the applicant owns minus any outstanding mortgage or debt. The home interest limit in most states in 2024 is either $713,000 or $1,071,000, depending on the average real estate prices in the state. Again, there are exceptions, like California, which has no home equity interest limit. It’s also important to note that home equity interest does not apply to ABD Medicaid applicants. Their homes are exempt regardless of value.

The home can also be exempt from the asset limit, regardless of home equity value, if only one spouse is applying and the non-applicant spouse is living there. The home may also be exempt for a single homeowner who is residing in a nursing home or another institution but has filed an intent to return home statement.

Medical Criteria

The medical eligibility for Medicaid Long Term Care depends on the Medicaid program for which they are applying. As a reminder, there are three types of Medicaid Long Term Care programs: Nursing Home Medicaid, Home and Community Based Services (HCBS) Waivers, and Aged, Blind and Disabled (ABD) Medicaid.

Nursing Home Medicaid and HCBS Waivers both require a nursing home level of care while ABD Medicaid does not have a level of care requirement.

Nursing Home Medicaid and HCBS Waivers both require a Nursing Facility Level of Care (NFLOC). The definition of NFLOC is different in every state, as is the way it’s measured. In most cases, level of care need is determined by assessing the applicant’s mental and physical health, and their need for skilled nursing or rehabilitative care. An important part of determining NFLOC is an assessment of the individual’s ability to independently complete the five Activities of Daily Living: mobility, bathing, dressing, eating and toileting. Failure to perform two or three ADLs independently is often seen as a strong indicator of the need for a NFLOC. However, this is not consistent across the 50 states.

A medical doctor is usually required to review and approve the NFLOC designation. A face-to-face functional assessment of the applicant is also a normal requirement to determine NFLOC. Functional assessments can be repeated every 12 months to ensure that the recipient continues to meet the state’s NFLOC. The applicant does not pay for the functional assessment because it’s part of the Medicaid application process.

ABD Medicaid only requires that the person is over age 65, or blind, or disabled. They do not require any medical need to be approved for the program. However, to be approved for specific benefits or long-term care services, they must be approved similar to the way a pre-authorization works with traditional health insurance. In other words, they must show a need for the long-term care services they’re applying for.

2024 Medicaid Long Term Care Eligibility Criteria Table

The table below provides general dollar values for the three types of Medicaid. These are not state-specific. This table should be used for comparative purposes. For accurate eligibility criteria, use our personalized Medicaid Eligibility Requirements Finder tool.