Medicaid Eligibility Requirements

Medicaid eligibility requirement is determined by looking at a person’s income and assets. When considering eligibility, certain personal assets are considered exempt and are therefore not included in the calculation of a person’s income. Such exempt assets include a person’s: home, wedding rings, burial plot, car, personal and household belongings (up to about $2000), and life insurance policies with a total cash value under $5000.

Everything is evaluated by your state’s standards to determine eligibility. To qualify, generally you must receive only a few hundred dollars of income per month and have a small amount of life insurance savings— no more than a few thousand dollars. You need to check your own state’s rules for eligibility, because the rules do vary. For assistance, contact your local Medicaid office or your local agency on aging.

Medicaid coverage is important because it is often the only way that people of middle or low incomes can afford long-term care, such as nursing home care. Because this care is so expensive, most people are not able to pay for years of care on their own, and at some point must rely on Medicaid to cover the bills.

In some states there is no income limit for Medicaid eligibility requirement. However, those states usually require that any of the senior’s income over a certain amount be paid directly to the nursing home, with Medicaid then paying whatever balance remains on the monthly care bill.

Medicaid recipients can keep some income for their personal use and to care for their homes. Medicaid calculates income according to the name on the check. If a check is payable to you, it is your income. If it is payable to your spouse, it is not your income as far as Medicaid is concerned.

To apply for Medicaid, you must provide financial records and proof of assets and expenses. Financial records for the previous thirty-six months before applying (known as the look-back period) are considered during the application process. This is important to remember, because many people incorrectly think they can transfer assets to relatives in order to qualify.

NOTE: The transfer rules are very complicated, and if you are considering trying to arrange your assets in order to qualify, it is important that you talk to a financial planner who is experienced in this area (medicaid eligibility requirements).