When Medicaid in North Carolina Will Pay for Long-Term Care in a Nursing Home

In North Carolina, Medicaid is a common source of funding for long-term care, particularly when people have already used up all of their own assets to pay for private care. And this doesn't take long—in 2018, the average daily cost of a private room in a nursing home in North Carolina was $254. Plus, private health insurance policies generally do not cover long term care, very few people purchase private long-term care insurance policies, and Medicare coverage for long-term care services is very limited.

In North Carolina, Medicaid is administered by the Division of Medical Assistance (DMA). To apply for Medicaid, contact the Department of Social Services office in your county. You can also apply online.

Not everyone can get Medicaid to pay for nursing home care in North Carolina, however. You must medically require skilled nursing care, and your income and assets must fall under the state Medicaid limits. The eligibility rules for long-term care services like nursing homes are different than for other Medicaid services.

When a Nursing Home Is Considered Medically Necessary in North Carolina

Medicaid will pay for a nursing home only when it is medically necessary. You must show that you "meet the nursing facility level of care," meaning that you need the kind of care that can only be provided in a nursing home.

To show that you meet a nursing home level of care, your physician must think you need the kind of services that are only offered in a skilled nursing facility. For example, you can meet the nursing facility level of care by showing that you need the services of a registered nurse for several hours a day, or by showing that you need daily assessments of your condition by a licensed nurse, or by showing that you need medication administered frequently by a nurse. If you have a nasogastric tube, require dialysis, frequent injections, or respiratory therapy, you are more likely to meet the nursing facility level of care.

If you need only custodial care such as help with activities of daily living (bathing, dressing, eating, getting in or out of a bed or chair, and using the bathroom), you are not likely to meet the nursing home level of care. (In this case, you may want to read the second part of this article on when North Carolina Medicaid will pay for assisted living or home health care.)

North Carolina's Medicaid Income Limit

People who receive SSI already qualify to receive Medicaid long-term care in North Carolina. If you don't receive SSI, and you are 65 or older, blind, or disabled, you must have income below $1,012/month for a household of one or $1,372/month for a household of two (in 2018).

If your income is above the limit, you still might be able to qualify for Medicaid if you have medical expenses that meet or exceed the amount of extra income you have. The Division of Medical Assistance (DMA) will calculate how much your monthly income exceeds the Medicaid income limit and then will multiply that amount by six. This amount is your Medicaid deductible. Once you satisfy your deductible, you are eligible for Medicaid for a period of six months. After six months, DMA will assess another deductible.

You can satisfy your deductible by showing DMA that you have medical expenses, including nursing home charges, that equal or exceed your deductible. You do not have to pay medical bills for them to count towards your deductible; you just need to show proof that you incurred the expenses. Because nursing homes are so expensive, the Medicaid deductible is a common way for nursing home residents to become eligible for Medicaid.

North Carolina's Medicaid Resource Limit

To qualify for Medicaid in North Carolina, you must have no more than $2,000 in resources (assets like money and property). Some property does not count toward the resource limit. In North Carolina, your home is exempt up to an equity value of $585,000 (in 2019), as long as you intend to return there or if your spouse or another dependent relative lives there. In addition, one car is exempt if it is used for transportation for yourself, your spouse, or a dependent relative. Personal belongings and household goods are also exempt. Retirement accounts are counted as assets to the extent you can withdraw money from them.

Spousal Maintenance Allowance in North Carolina

If you have a spouse who is going to continue to live independently while you go to a nursing home, then North Carolina will allow you and your spouse to keep more income and assets to support that spouse.

Income. First, your spouse (called the "community spouse") may be allowed to keep some of your income each month. The amount that DMA determines that your spouse can keep will depend on how much separate income your spouse has and also how much he or she spends on housing. In 2019, the minimum monthly "community spouse income allowance" is $2,058, and the maximum is $3,090.

In addition, if you have dependents who will remain in the community while you go to a nursing home, these dependents might be entitled to keep some of your income. This is called the dependent family member allowance. Your dependents must be claimed as dependents on your tax return to qualify for this allowance. The amount your dependent can keep from your income depends on whether they have income of their own. The maximum that a dependent can keep is $686/month.

The amounts that DMA calculates for your community spouse's income allowance and your dependents' family member allowance reduce the amount of your Medicaid deductible. So, if you have a spouse receiving $3,090 and a dependent receiving $686 (for a total of $3,776/month), then your six-month Medicaid deductible is reduced by $22,656 ($3,776/month for six months).

Assets. North Carolina assumes that half of the assets that you had at the time of your first admission to a nursing home (called the "community spouse resource allowance," or CSRA) belong to your spouse, subject to a limit that changes annually. The limit for the CSRA in 2018 is $123,600. The minimum is $24,730. When you apply for Medicaid, DMA will tell you how much your community spouse is entitled to keep. If your spouse needs more, you can go to court and ask a judge to allow a higher CSRA.

When you apply for Medicaid, your CSRA is subtracted from your countable assets at the time of your application. For example, say Mr. has $80,000 in countable assets when Mr. Brown moves into a nursing home on February 1st. Mrs. Brown continues to live in the couple's home. Mr. Brown uses half of his savings to pay for his nursing home care until December 1st, when he applies for Medicaid. On December 1st, Mr. Brown has $40,000 in countable assets. Because Mrs. Brown's CSRA is $40,000, she is entitled to keep the $40,000. Mr. Brown then has no countable assets, and he meets the resource eligibility criteria for Medicaid.

Personal Needs Allowance in North Carolina

If you receive Medicaid and live in a nursing home, you will be expected to spend almost all of your income on your care. North Carolina allows nursing home residents receiving Medicaid to keep just $30/month as a personal needs allowance.

Read on to find out about when Medicaid will pay for assisted living or home health care in North Carolina.

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