Medicaid Income Limits for Married Couples

Medicaid provides long-term health care benefits for certain qualifying residents of nursing homes depending upon available income and resources. To be eligible for Medicaid, the applicant's monthly income and resources cannot exceed established limits. Separate rules apply for income and resources. Generally, Medicaid eligibility for payment of nursing home expenses centers on the couple's resource level. The couple's income level determines how much money the nursing home resident is required to pay to the nursing home each month. To protect the community spouse (the spouse who remains at home) from impoverishment when the institutionalized spouse is placed in a nursing home, Medicaid establishes guidelines for determining available income.

The community spouse's income, including the community spouse's share of community income, Social Security benefits, and separately owned pensions and income, is not considered in determining the applicant's eligibility for Medicaid benefits and may be retained by the community spouse. Income that is jointly owned with third parties is allocated to the institutionalized spouse, the community spouse, and the third party in the proportion of their ownership interests.

Each state's Medicaid agency determines what is referred to as a "minimum monthly maintenance needs allowance" within a minimum and maximum range established under a complicated formula that keys off of the poverty level for a two-member family and the community spouse's housing costs. If the community spouse's income is less than the established minimum monthly maintenance needs allowance, a portion of the institutionalized spouse's income may be allocated to the community spouse to fill the gap. It is important to remember that the institutionalized spouse retains a portion of her income for a personal needs allowance set by the state (generally between $30 and $60 dollars per month), certain dependents, and her own health care expenses. Any of the institutionalized spouse's income that exceeds the personal needs allowance and other excluded income is available to pay for the institutionalized spouse's monthly nursing home expenses if the community spouse does not show a need for that income.

A community spouse can challenge the determination of retained income after Medicaid eligibility is established within the Medicaid agency or by filing an order for an income increase in a court. Typically, exceptional circumstances or financial hardship or duress must be shown for the community spouse to prevail.