Medicaid is a joint federal and state program that helps with healthcare costs for people with limited income and resources. One of its key benefits is coverage for long-term care in a nursing home—something Medicare generally does not provide. However, the process of applying for Medicaid to cover nursing home costs can be complex and varies by state. This guide outlines the general steps involved and key considerations for individuals or caregivers navigating the process.
Step 1: Understand Medicaid Eligibility for Nursing Home Care
To qualify for Medicaid coverage of nursing home care, applicants must meet several criteria:
1. Medical Eligibility
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The applicant must require a “nursing home level of care.” This is typically determined through an assessment by the state’s Medicaid agency or a designated care management organization.
2. Financial Eligibility
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Income limits: Vary by state, but most states set the income limit around 300% of the federal SSI benefit rate (e.g., about $2,800/month in 2025).
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Asset limits: Typically $2,000 for a single applicant. Some assets are exempt, such as a primary residence (up to a certain equity limit), personal belongings, and a vehicle.
Step 2: Gather Documentation
Applicants will need to provide detailed documentation for both medical and financial eligibility. Key documents include:
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Proof of income (Social Security, pensions, annuities)
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Bank statements and investment accounts
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Deeds, mortgage statements, and property tax bills
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Insurance policies (especially life insurance with cash value)
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Identification documents (birth certificate, Social Security card)
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Medical records or assessments supporting the need for nursing home care
Step 3: Spend Down Assets (If Necessary)
If the applicant’s assets exceed the Medicaid limit, they may need to “spend down” their resources before becoming eligible. This must be done carefully to avoid violating Medicaid’s five-year look-back period:
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Look-back period: Medicaid reviews all asset transfers made within the past 60 months (5 years) to ensure they were not sold or given away to qualify for Medicaid. Uncompensated transfers can lead to a penalty period of ineligibility.
Permitted strategies may include:
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Paying off debt
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Making home modifications for medical need
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Purchasing Medicaid-compliant annuities
Step 4: Apply for Medicaid
You can submit a Medicaid application through your state’s Medicaid office. Many states offer multiple methods:
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Online via the state Medicaid or Health and Human Services website
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In person at a local Department of Social Services office
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By mail or phone, if offered
Be prepared for an interview and ongoing communication to verify documents and answer questions.
Step 5: Wait for the Determination
Once the application is submitted, it may take 30–90 days (or more, depending on the state) to receive a determination. If approved, Medicaid will pay for the nursing home retroactively to the application date or the date the applicant became eligible.
Step 6: Post-Approval: Estate Recovery and Contribution Rules
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Estate recovery: After the Medicaid recipient dies, the state may try to recover the cost of care from their estate. Certain exemptions may apply, especially if a spouse, disabled child, or dependent resides in the home.
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Patient liability: Medicaid typically requires the recipient to contribute most of their monthly income to the nursing home, minus an allowance for personal needs and sometimes a spousal allowance.
Important Considerations
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Spousal Protections: If the applicant is married, the non-applicant spouse (also called the “community spouse”) may be entitled to keep a larger portion of the couple’s assets and income. This is known as the Community Spouse Resource Allowance (CSRA) and Monthly Maintenance Needs Allowance (MMNA).
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Professional Help: Consider working with an elder law attorney or Medicaid planner to help navigate the application and spend-down process, especially if the applicant owns significant assets or real estate.
Final Thoughts
Applying for Medicaid to help pay for nursing home care can be overwhelming, but understanding the eligibility rules and following a structured approach can ease the burden. By preparing documentation, adhering to the rules on assets and transfers, and seeking professional guidance when needed, families can secure the long-term care their loved ones need while preserving financial stability.
For state-specific information, visit your state’s Medicaid website or call your local Area Agency on Aging.