Medicaid Eligibility: Part Two – Financial Need

Last week, we discussed Medicaid’s medical need eligibility requirement and learned that it’s…. complex.  Arguably, the financial eligibility standards for Medicaid are facially less complex; however, the potential for planning avenues down these two paths can often lead to much more complexity.  So, what exactly are the two financial requirements to qualify for Medicaid? 

READ MORE: Medicaid Eligibility – Medical Need

Income Level 

In 2024, the monthly income for assisted living facilities, nursing homes, and community applicants seeking Medicaid home and community-based waiver services is $2,829.  Medicaid considers your gross income on a monthly basis, factoring in applicable exclusions, but does not factor your current medical expenses into this income figure.  Even after applying any appropriate exclusions, if an applicant has income over $2,829, the applicant is still ineligible. However, a Qualified Income Trust could then be established to reduce the income to the appropriate levels. 

Asset Level 

In 2024, the asset limit for a Medicaid applicant is $2,000. If an applicant is married there will be additional assets that the non-applicant spouse is permitted to keep, however for the purposes of this article, our focus is on a single applicant. It comes as no surprise that most adults have more than $2,000 in assets.  Luckily for many folks, there are assets that are “counted” by Medicaid and some that are not.  For instance, some non-counted assets are as follows: 

READ MORE: Retitling a Property to a Trust

• Principal Residence: Home equity in a primary residence may be excluded from the asset calculation.  This calculation is even more preferable if the applicant is married, and the home is occupied by the applicant’s spouse, or another relative. 

• Vehicles: One vehicle is excluded. 

• Household Goods: Most household goods (furniture, clothing, linens, etc.) of reasonable value are exempt. 

• Prepaid Burial Contracts and Burial Spaces 

• Life Insurance: Life insurance is exempt if the policy’s face value is $1,500 or less. 

Now that we have a general idea of what is required to qualify for Medicaid, next week we will wrap up by considering a few basic planning techniques for applicants who seek Medicaid coverage but might not quite meet all coverage requirements.