Medicaid: Protections for Spousal Income During Long-Term Care

Medicaid does not require a healthy spouse to give up all of her income and property so the spouse needing care can qualify for long-term care through Medicaid. Instead, Medicaid has a set of rules called "spousal protections" that allow the spouse of a nursing home resident to keep enough income and assets to live on. There is variation among states' spousal protections rules, but the basic guidelines are the same in every state.

When Do Spousal Protection Rules Apply?

States have long been required to have spousal protection rules for Medicaid recipients who are in nursing homes, but until recently, they were not required to have spousal protection rules for other Medicaid recipients, like those receiving in-home care. Now that all states should have rules protecting the income and/or assets of spouses of Medicaid recipients getting long-term care outside of nursing homes, check with your state Medicaid agency to find out the rules in your state.

What Income is Protected?

Spouses of long-term care patients receiving Medicaid are allowed to keep all of their own income, and they may be able to keep some of their spouse's income if they need the financial support. The amount of money that a spouse may keep and that is exempt from the Medicaid eligibility calculation is called the "minimum monthly maintenance needs allowance" (MMMNA).

The MMMNA varies from state to state, but the federal government sets a minimum and a maximum periodically that is tied to poverty guidelines. The minimum amount that a state must allow a community spouse to keep is $2,289, and the maximum is $3,715.50 (this amount changes each year in July). A state must choose an MMMNA that falls within these amounts. For example, California, Texas, and New York use the monthly figure of $3,715.50.

That amount of income is disregarded by the state Medicaid agency in evaluating whether the "needy" spouse (the spouse who needs care) is financially eligible for Medicaid.

What Assets are Protected?

A spouse is also allowed to keep one-half of the couple's marital assets ("resources"), subject to a minimum and maximum that is set by each state Medicaid agency, according to federal guidelines. The state will measure the resources of the spouse applying for Medicaid on the date that the spouse began a hospital or nursing home stay that lasted at least 30 days.

The amount of resources that the healthy spouse (the "community spouse") is allowed to keep is called the community spouse resource allowance (CSRA), and it varies by state. Medicaid sets a minimum and maximum CSRA that the state CSRA fall within, but the states are allowed to choose from a wide range.

For July 2022 through June 2023, the federal maximum CSRA is $148,620 (the state can't allow the community spouse to keep more assets than that), and the federal minimum is $29,724. You should check with your state's Medicaid agency to find out how much in resources you are allowed to keep if your spouse enters a nursing home.

If a spouse living in the community needs more income than the MMMNA or more resources than the CSRA, the spouse can seek a court order allowing a variation from the state agency's standard.

Protection of Couple's Home

Federal Medicaid rules protect a Medicaid recipient's home and the property the house is on, and that's an important protection for spouses who remain in the community.

If a recipient thinks they will return to the home at some point, the first $688,000 in equity is excluded as a resource when the state calculates whether the needy spouse is eligible for Medicaid. (And some states choose to raise the equity limit to as much as $1,033,000.) For instance, if you and your spouse have equity in your house worth $650,000, and no other countable assets, and your spouse needs to go to a nursing home but plans on returning to live in the house again someday, your spouse should qualify for Medicaid.

However, states also have discretion about when they will disregard the value of a home when calculating eligibility; many states require that the recipient be likely to return to the home, not just that the recipient intends to return to the home.

For information on Medicaid-paid long-term care, see our article on when Medicaid will pay for nursing home care.

_{Updated January 30, 2023}