What Happens When One Spouse Goes to a Nursing Home?

Initial Funding Sources for Nursing Home Care

When a spouse requires nursing home care, personal resources often cover the initial financial responsibility. These expenses can quickly deplete savings and other liquid assets, as the average cost of nursing home care ranges from approximately $8,000 to over $10,000 per month, depending on the type of room and geographic location.

Medicare offers limited assistance for skilled nursing facility (SNF) care. For Medicare to cover SNF care, a person must have had a qualifying hospital stay of at least three consecutive days, not including the day of discharge. Medicare Part A covers 100% of approved costs for the first 20 days of SNF care. From day 21 to day 100, Medicare requires a daily co-insurance payment, which in 2025 is $210.50. Beyond 100 days, Medicare provides no coverage, and the individual becomes responsible for the full cost.

Long-term care insurance policies help cover costs Medicare does not, including extended nursing home stays. These policies have a daily benefit amount, the maximum the policy pays per day for covered services. They also include an elimination period, a waiting period (often 30, 60, or 90 days) during which the policyholder pays out-of-pocket before benefits begin. The benefit period specifies the total length of time, such as two to five years or a lifetime, that the policy will pay for care. These policies can help protect personal assets by covering a portion of long-term care expenses.

Medicaid Eligibility for Long-Term Care

Medicaid eligibility for long-term nursing home care involves specific financial criteria related to income and assets. For the nursing home resident, income limits vary by state. Some states implement an “income cap” requiring an individual’s gross monthly income to be below a certain threshold, often around $2,829 per month. If income exceeds this cap, individuals may still qualify through a “medically needy” pathway, allowing them to spend down excess income on medical expenses. Other states, known as “income first” states, require all of the resident’s income, minus certain allowances, to be contributed toward the cost of care.

Asset limits are strict for the nursing home resident, generally $2,000 for a single individual in most states. Exempt assets include a primary residence (with equity limits in some cases), one vehicle, household goods, and personal effects. Countable assets include bank accounts, investments, and certain retirement funds. To determine eligibility, Medicaid employs a “look-back period” of 60 months (five years) in all states. During this period, all financial transactions are reviewed for uncompensated transfers of assets, such as gifts or sales below fair market value.

If uncompensated transfers are found, a penalty period is imposed during which Medicaid will not pay for nursing home care. The length of this penalty period is calculated by dividing the total value of uncompensated transfers by the average monthly cost of nursing home care in that state. For example, a $100,000 gift in a state where the average monthly cost is $10,000 would result in a 10-month penalty period. Transfers made beyond the 60-month look-back period are not subject to this penalty.

When one spouse requires nursing home care and the other remains in the community, spousal impoverishment rules protect the community spouse’s financial well-being. The Community Spouse Resource Allowance (CSRA) allows the community spouse to retain a portion of the couple’s combined countable assets without jeopardizing the institutionalized spouse’s Medicaid eligibility. The CSRA has a state-specific minimum and maximum, ranging from approximately $30,000 to $154,000 in most states. The couple’s total countable assets are assessed when the institutionalized spouse enters the nursing home or applies for Medicaid, whichever is earlier. The community spouse can then keep up to the maximum CSRA amount, or half of the couple’s combined assets up to the maximum.

The Minimum Monthly Maintenance Needs Allowance (MMMNA) ensures the community spouse has sufficient income to live independently. If the community spouse’s own income falls below the state-determined MMMNA, a portion of the institutionalized spouse’s income can be allocated to the community spouse to meet this need. The MMMNA ranges from approximately $2,400 to $3,800 per month, depending on the state and specific housing costs. This income allowance helps prevent the community spouse from becoming impoverished while their partner receives long-term care through Medicaid.

The Medicaid Application Process

Once eligibility criteria are understood, the next step involves formally applying for Medicaid. Official application forms are available from your state’s Medicaid agency website or a local Department of Social Services office. These resources provide instructions and checklists. Some states offer online portals for initial inquiries, though the full application often requires paper submission.

A comprehensive set of documents is required to support a Medicaid application. These commonly include bank statements, proof of income (e.g., Social Security, pensions), and property deeds. Insurance policies, including life and long-term care policies, must also be provided. Other necessary documents often include birth certificates, marriage certificates, and copies of any trusts or power of attorney documents.

After gathering all required information, the completed application and supporting documents can be submitted. Many states allow submission by mail to a designated Medicaid processing center. Some agencies accept applications in person. For online submission, an initial data entry process is common, followed by instructions on how to submit physical copies of supporting documents.

Following submission, applicants should expect a period of review and potential follow-up. The Medicaid agency may schedule an interview to clarify information or address discrepancies. The agency often requests additional documentation if something is missing or unclear. The timeline for a decision on a Medicaid application varies by state, often ranging from 30 to 90 days.

Financial Management After Medicaid Approval

Even after Medicaid approval for nursing home care, the institutionalized spouse contributes a portion of their income toward the cost of care, known as the “patient’s share of cost” or “applied income.” This amount is calculated by taking the resident’s gross monthly income and subtracting certain allowances. These allowances include a small personal needs allowance, usually around $50-$75 per month, and any income allocated to the community spouse through the Minimum Monthly Maintenance Needs Allowance (MMMNA). The remaining income is then remitted directly to the nursing home.

Maintaining Medicaid eligibility requires ongoing communication with the state agency. Any changes in income, assets, or living situation for either spouse must be reported promptly. This includes increases or decreases in Social Security benefits, pension payments, or the receipt of new assets like an inheritance. Failure to report changes can result in a loss of benefits or the need to repay previously covered costs.

Medicaid eligibility is subject to periodic review through a process known as redetermination or renewal. This typically occurs annually, where the state Medicaid agency requires updated financial and medical information to verify continued eligibility. Applicants receive notification and instructions on how to complete the renewal process, which often involves submitting updated documentation similar to the initial application.

A significant consideration after Medicaid approval is the Medicaid Estate Recovery Program (MERP). Federal law mandates that states operate MERPs to recover costs for Medicaid-paid long-term care services from the estates of deceased Medicaid recipients. This recovery typically occurs after the death of both the Medicaid recipient and their surviving spouse. Assets subject to recovery commonly include the deceased individual’s home, real property, and other assets that pass through probate. States have provisions for hardship exemptions or deferrals in specific circumstances.