When Medicaid in Illinois Will Pay for a Nursing Home, Assisted Living, or Home Health Care

Illinois' Medicaid program pays for nursing homes, assisted living, and home health care services for many Illinoisans.

By , Attorney New York University School of Law
Updated 12/29/2023

Long-term care services in Illinois, including nursing homes, assisted living facilities, and home health care, are expensive. In 2021, the average monthly cost of a private room in a nursing home in Illinois was almost $7,200, or nearly $86,000 per year.

Private health insurance policies generally don't cover long-term care (LTC), and Medicare coverage for LTC services is limited. LTC insurance policies can help pick up some of the tab, but few people purchase it. This leaves Medicaid, which has become a very common source of funding for long-term care.

Medicaid, however, has strict eligibility rules for long-term care in Illinois. Besides qualifying financially, you also need to qualify medically for Medicaid to pay for any LTC service like a nursing home, assisted living facility, or home health care.

Medicaid for Illinoisans in Nursing Homes

In Illinois, people who are 65 or older, disabled, or blind can qualify for Medicaid through the Aid to the Aged, Blind and Disabled (AABD Medical) program, if they also meet income and asset limits.

Medical Assistance (Illinois' name for Medicaid) and the AABD program, administered through the Illinois Department of Healthcare and Family Services (HFS), also provide cash benefits.

Because different types of Illinois Medicaid programs provide LTC coverage—including AABD Medical, Home and Community Based Services (HCBS) waivers, and nursing home Medicaid (for persons living in nursing homes)—it's important to note the services offered and financial and other eligibility requirements of each.

If you already receive Medical Assistance in Illinois, then your Medicaid coverage includes nursing home care if you need it. Nursing homes are residential facilities that offer around-the-clock skilled nursing care in addition to other supportive services. You can search from a list of licensed nursing homes in Illinois here.

Income Limits for Medicaid in Illinois

Income limits for Medical Assistance may be different depending on whether you live in the community or in a nursing home or assisted living facility.

Income Limits for People Living in the Community

AABD Medical covers elderly, blind, and disabled residents living in the community (at home or with friends or relatives) with income up to 100% of the federal poverty level (FPL). In 2023, that's $1,215 per month for a household of one or $1,643 per month for a household of two.

If your income is more than the FPL, you can still qualify for AABD Medical by "spending down" your excess income every month on certain medical expenses. The state determines your spend-down amount based on your income. You qualify for Medicaid every month you can show the state that you have incurred the associated expenses, even if you have not yet actually paid them.

For example, Mrs. Brown has excess income above the AABD Medical income standard. Illinois tells Mrs. Brown her spend-down amount is $120 per month. She has a doctor's appointment that will cost her $250 out of pocket. She has met her spend-down and qualifies for AABD Medical that month.

Enrollment in "Pay-In Spenddown" gives AABD Medical recipients the option of paying their spend-down amount to HFS. That means that they don't need to bring in proof of their medical expenses each month. They can just pay the spend-down amount to the state and qualify for AABD Medical that month. So in the example above, Mrs. Brown could just pay the state $120 each month and be sure that she would get her medical benefits.

Pay-In Spenddown isn't available for residents of nursing or supportive living facilities.

Income Limits for People Living in a Facility

If you are living in a nursing facility, you can have more income than 100% of the federal poverty level, but you'll be required to pay almost all of your monthly income toward your care. Illinois Medicaid allows single recipients in nursing homes to keep only $30 per month for themselves. The state does have rules that allow a "community spouse" (the spouse not entering a nursing home) to keep more income.

If your monthly income exceeds the cost of the nursing or supportive living facility, you can still qualify for Medicaid benefits if you spend down your excess income every month on other eligible expenses.

Resource Limit for Medicaid in Illinois

To qualify for Medical Assistance, you must have less than $17,500 in "non-exempt" resources. Resources are assets like money and property. For married couples with one spouse applying, the non-applicant spouse can retain $120,780 (as of 2023).

Some property doesn't count toward the resource limit (the property is called "exempt"). Your home isn't counted as an asset for Medicaid in Illinois (up to a home equity limit of $713,000 in 2024). And your personal belongings and household goods of reasonable value are exempt.

One car is also exempt if:

  • someone in your family uses it to get to work
  • you or someone in your family uses it to attend medical appointments
  • it's been modified to transport a person with disabilities, or
  • it's needed for essential daily activities.

If you have resources that exceed the limit but need Medical Assistance in order to move into a nursing home, you can spend down your assets and qualify. If you have a spouse who is remaining at home, then you'll be allowed to keep some assets to help support that person.

When a Nursing Home Is Medically Necessary

Medicaid will pay for a nursing home only when it's medically necessary. Medicaid won't pay for nursing home care that's just custodial, meaning non-medical care such as help with transferring to and from a wheelchair, bathing, or eating.

Before Medicaid will pay for nursing home care, you must have a needs screening. If you're in a hospital, the hospital will arrange the needs screening for you. If you're in your home, you should contact the state to arrange for a screening. Here's who to call:

  • Individuals who are 60 and over can call the Department on Aging at 800-252-8966 to arrange for a needs screening.
  • Individuals with a physical disability can call the Department of Human Services (DHS) at 877-761-9780 to arrange for a screening.
  • Individuals who are developmentally delayed or have a mental illness can call DHS at 800-843-6154.

Medicaid uses the information in your needs screening to decide whether you qualify for a nursing home and, if so, what kind of nursing home is appropriate for you. In general, for a nursing home to be considered medically necessary, you must have a medical condition that is so serious that you need the level of skilled nursing care that is available in an institution.

Medicaid for Illinoisans in Supportive Living Facilities

Supportive living facilities (SLFs, also known as assisted living facilities) provide apartment-style room and board, therapy and nursing services, and supervision. SLFs are generally less expensive and less medically intensive than nursing homes. In Illinois, SLFs are specially licensed and monitored.

Illinois operates a Medicaid waiver program called the Supportive Living Program (SLP) to pay for some of the costs of supportive living facilities.

To qualify for SLP, you must be 65 or over or an adult with a physical disability. If you have a primary or secondary diagnosis of developmental disability or serious and persistent mental illness, then you won't qualify for SLP. You must require the nursing home level of care.

If you qualify, SLP will pay for many of the services that you can receive in an SLF, like personal care services, housekeeping, meals, exercise programs, medication supervision, and temporary nursing care. You must pay the room and board fee for the living facility. You must have monthly income that's equal to or greater than the SSI amount to qualify for this program. In 2024, that's $943 per month for a single person ($1,415 for a couple).

If you're eligible for SLP, you'll need to pay almost all of your monthly income to the facility. SLF residents are allowed to keep $90 per month as a personal needs allowance.

To apply for SLP, contact a participating facility directly, and the facility will help you get the appropriate assessments and paperwork done. For more information or if you have questions about an SLP provider, contact the HFS Bureau of Long Term Care by calling 844-528-8444 or review the HFS SLP resident fact sheet web page.

Assistance for Illinoisans Needing Home Health Care

Home health care can include:

  • skilled nursing or therapy services
  • home health aide services like medication management or bathing assistance, and
  • personal care aide services like meal preparation or cleaning.

Illinois has several programs that offer payment for home health care services.

AABD Medical

First, if you receive AABD Medical, the program will pay for some limited home care services. The services must be prescribed by your doctor as part of a plan of care for a particular condition, and the services must be directed at curing or rehabilitating your condition.

AABD Medical won't pay for services that you might need on a long-term basis like housekeeping, but it will pay for services provided by:

  • a home health care agency
  • a physical therapist
  • a speech therapist, or
  • an occupational therapist.

HCBS Waivers

Illinois has a number of active Home and Community Based Services (HCBS) waiver programs. These programs provide services that allow individuals to live in their own homes or community settings instead of institutions. Individuals who meet certain Medicaid financial and medical needs eligibility criteria, as well as any other particular requirements specified in each waiver, may be eligible to participate in one of these programs.

For example, the Persons who are Elderly waiver provides services and individualized support to elderly persons who would otherwise require nursing facility care. This waiver is a component of the Community Care Program (CCP) provided through the Illinois Department on Aging (DoA).

Generally speaking, if you qualify for CCP, you can receive homemaker services, adult daycare services, and emergency home response services. To qualify, you must be 65 or over, or 60-64 and physically disabled. You must have an assessment that shows you are at risk of being placed in a nursing facility and have less than $17,500 in non-exempt assets. If you have enough monthly income, you may be required to contribute to the cost of the services. To apply, contact the Department on Aging Senior Help Line at 800-252-8966.

Another example of an Illinois HCBS waiver is the Persons with Disabilities (PD) waiver. If you're a disabled individual under 60 at risk of placement in a nursing facility, then you might qualify for this program. The PD program pays for home health services like a personal assistant, therapy or nursing in your home, delivered meals, and housekeeping. To qualify, you must have a needs assessment that shows that you're at risk of being placed in a nursing home without these services.

Illinois operates a similar program for adults suffering from brain injuries, called the Persons with Brain Injury waiver.

You can obtain more information about the services available, and apply for the programs online, on the Home Services Program page of the Illinois Department of Human Services.

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