Medicaid āŗ Long-term care
Who pays for long-term care, and how Medicaid works
For anyone planning ahead for themselves, a spouse or a parent. By the end you’ll know what Medicare covers, what it doesn’t, and the Medicaid rules that decide who pays for a nursing home or care at home.
Medicare does not pay for long-term care: help with bathing, dressing and daily living, in a nursing home or at home. Medicaid is the main public program that does. To qualify you must meet your state’s income and savings rules. A spouse who stays at home can keep a protected share of the couple’s savings and income.
What does Medicare cover?
Medicare pays for a short stay in a skilled nursing facility to recover after a hospital stay. It does not pay for long-term custodial care.
- You need a hospital stay of at least 3 days in a row as an inpatient first. Time under “observation” and in the emergency room doesn’t count.
- You must need daily skilled care, such as nursing or therapy.
- Medicare covers up to 100 days in each benefit period. In 2026, days 1 to 20 cost $0. Days 21 to 100 cost $217 a day. After day 100, you pay everything.
If a parent is in the hospital, ask the staff: “Is she admitted as an inpatient, or here under observation?” The answer decides whether Medicare will cover a nursing home stay afterward.
Who qualifies for Medicaid long-term care?
You must need the level of care a nursing home provides, as your state assesses it, and meet two money tests.
The savings test
In most states the limit is $2,000 in countable savings for one person. Some states set a different limit. Many things don’t count:
- Your home, while you or your spouse live there. There is an equity limit if no spouse or qualifying child lives there. States set it between $752,000 and $1,130,000 in 2026.
- One car
- Furniture, household goods and personal belongings
- Burial plots, and burial funds up to $1,500 each for you and your spouse if kept separate
The income test
Many states use an income limit of $2,982 a month in 2026 (three times the SSI amount). Some states with that cap let people with higher income qualify by putting the extra into a special trust, often called a Miller trust. Other states let you “spend down”: you qualify once your medical bills bring your income below the limit. Ask your state which method it uses.
How is a spouse at home protected?
When one spouse needs nursing home care and the other stays home, federal rules keep the spouse at home from losing everything. In 2026:
| What the spouse at home keeps | 2026 federal range |
|---|---|
| Savings (the couple’s countable savings) | At least $32,532 and up to $162,660, depending on the state |
| Monthly income | At least $2,705 a month (July 2026 to June 2027), up to $4,066.50. Higher in Alaska and Hawaii. |
| The home | Not counted while the spouse lives there |
If the spouse at home has little income, part of the other spouse’s income can go to them to reach that minimum. These protections also apply to married couples getting Medicaid care at home, under a federal rule that runs through September 30, 2027.
What is the 5-year look-back?
When you apply, Medicaid reviews every gift or transfer you made in the past 60 months. If you gave money or property away for less than it was worth, Medicaid applies a penalty: a period when it won’t pay for care.
- The length is the amount given away divided by your state’s average monthly cost of nursing home care.
- The penalty only starts once you’ve applied, are in care and would otherwise qualify. So it lands at the worst possible time.
- Some transfers of a home carry no penalty, such as to a spouse, to a child under 21 or a disabled child, or to an adult child who lived there and gave care for at least 2 years.
Don’t move money to family to “get under the limit” without advice. A gift made today can delay coverage years from now. Talk to an elder law attorney in your state first.
Can Medicaid take the house after death?
For anyone 55 or older, states must try to recover what Medicaid paid for nursing home care, care at home and related hospital and drug costs. This is called estate recovery. There are firm protections:
- Nothing is recovered while a surviving spouse is alive.
- Nothing is recovered while there is a child under 21, or a child who is blind or disabled.
- Every state must have a hardship waiver.
What counts as the “estate” differs by state. Some states only look at property that goes through probate. Others reach further.
Is there care at home instead of a nursing home?
Yes. Every state offers Medicaid programs, often called waivers, that pay for help at home or in the community. Many have waiting lists. KFF counted about 650,000 people on these lists in 2026, across 40 states. Apply early, even if you don’t need the help yet.
PACE is another option in some areas. It covers medical care and support for people 55 and older who need nursing-home-level care but can live safely at home with help. With Medicaid there is no monthly PACE premium. Find PACE near you on Medicare.gov.
What’s changing
- January 1, 2027: for people applying as older adults or people with disabilities, Medicaid will cover bills back 2 months before the month you apply, down from 3. Apply as soon as care starts.
- January 1, 2028: the highest home equity limit a state can use drops to $1,000,000.
- Call your state Medicaid office and ask for its long-term care rules: savings limit, income method and home equity limit.
- Gather 5 years of bank statements now. You’ll need them for the look-back.
- If a spouse will stay at home, or you’re thinking of moving assets, see an elder law attorney first.
Related
Sources. CMS, “2026 SSI and Spousal Impoverishment Standards” (Dec 9, 2025; updated Apr 27, 2026) Ā· Social Security Act Ā§1917 (transfers, estate recovery, home equity) Ā· 20 CFR 416 (SSI resource rules) Ā· Medicare.gov, “Long-term care” and “Skilled nursing facility care” Ā· CMS, 2026 Medicare Parts A & B premiums and deductibles (Nov 14, 2025) Ā· Medicare.gov, PACE Ā· Medicaid.gov, 1915(c) waivers Ā· KFF, waiting lists for Medicaid home and community-based services, 2016 to 2026 (Oct 5, 2026) Ā· Public Law 119-21, Ā§Ā§71108 and 71112.
Last verified: November 12, 2026. CMS publishes the 2027 figures around December. We update this page when it does.
Benefits Insider is an independent publisher, not a government agency. This page is general information, not legal or financial advice for your situation. Long-term care Medicaid rules vary by state. For a decision on your case, contact your state Medicaid office or an elder law attorney.