To apply for Medicaid long-term care, you submit an application to your state Medicaid agency showing you meet both a financial test and a medical test. In most states in 2026, an individual applicant can hold no more than about $2,000 in countable assets, and monthly income generally cannot exceed $2,982, which is 300 percent of the federal benefit rate of $994.1Social Security Administration. SSI Federal Payment Amounts for 2026 You also need clinical documentation showing you require a nursing-facility level of care. Expect to produce five years of financial records, sign a detailed application, and wait 45 to 90 days for a decision.
Financial Eligibility
The caseworker’s first job is checking your numbers against the limits set by federal law in 42 U.S.C. § 1396p and applied by your state.2Office of the Law Revision Counsel. 42 USC 1396p – Liens, Adjustments and Recoveries, and Transfers of Assets
Countable and Exempt Assets
Countable assets include bank accounts, stocks, bonds, mutual funds, certificates of deposit, and any real estate beyond your primary home. The application must disclose everything you or your spouse owns or has a legal right to receive.
Several assets are exempt. Your primary home is usually excluded as long as its equity is below your state’s cap, which federal rules set between $752,000 and $1,130,000 in 2026.3Centers for Medicare & Medicaid Services. 2026 SSI and Spousal Impoverishment Standards One vehicle, personal belongings, household furnishings, and prepaid burial arrangements are also typically excluded. Whole life insurance is exempt in most states if the combined face value of all policies stays at or below $1,500; above that, the cash surrender value counts.
Income Limits
Many states use the “special income level,” capping eligibility at 300 percent of the monthly federal benefit rate. For 2026, that ceiling is $2,982.1Social Security Administration. SSI Federal Payment Amounts for 2026 Income includes Social Security, pensions, annuity payments, and wages. Include Social Security award letters, pension statements, and the last two years of tax returns to document every source.
If your income is over the ceiling, you may not be disqualified. About half the states allow a Qualified Income Trust, sometimes called a Miller Trust. You deposit your income into this irrevocable trust each month, the trust pays your share of care costs and a small personal-needs allowance, and the remainder keeps you under the cap. The trust must name the state Medicaid agency as remainder beneficiary at your death, up to the total benefits paid on your behalf. States that don’t use the special income level often have a “medically needy” pathway with its own spend-down calculation.
The Five-Year Look-Back and Transfer Penalties
Federal law requires states to review every financial transaction you made during the 60 months before your application date.2Office of the Law Revision Counsel. 42 USC 1396p – Liens, Adjustments and Recoveries, and Transfers of Assets Caseworkers look for anything you gave away or sold below fair market value. Transferring your home to a child for nothing two years before applying will be flagged.
When a below-market transfer turns up, the agency imposes a penalty period during which you cannot receive Medicaid long-term care. The math: divide the value you gave away by the average monthly cost of nursing home care in your state. Give away $120,000 in a state where nursing homes average $10,000 a month, and you face a 12-month penalty. During that period, care costs come out of your pocket.
Gathering five years of records is the slowest part of the application. You need monthly statements from every checking, savings, investment, and retirement account, showing deposits and withdrawals. Large or unusual transactions need written explanations, so prepare documentation for home repairs, vehicle purchases, or gifts to family members.
Spending Down Excess Assets
If your countable assets are over the limit, you can spend them down before applying. The spending must be for fair value or on exempt items, because everything you did during the look-back will be examined. Acceptable strategies include:
- Paying off credit card balances, medical bills, outstanding taxes, and mortgage debt.
- Making repairs, renovations, and accessibility modifications to your primary residence, which is an exempt asset.
- Funding an irrevocable burial trust or prepaying funeral arrangements, subject to state limits.
- Replacing a primary vehicle or essential household items.
Prepaying for services you haven’t yet received, like a year of utilities in advance, is generally treated as a gift and will trigger a penalty. Pay for things already delivered or owed.
Medical Documentation and the Level of Care Assessment
Meeting the financial criteria gets you halfway. You also need to show you require a nursing-facility level of care through a clinical assessment. Every state has its own tool, but the question is the same: do your medical conditions require the ongoing, skilled supervision a nursing home provides?
The assessment focuses on activities of daily living: bathing, dressing, eating, toileting, and transferring in and out of a bed or chair. The evaluator records whether you can do each task independently, need some help, or are fully dependent. Significant loss of function across several of these areas is typically the clearest path to qualifying. The assessment also considers cognitive impairments such as dementia, a history of falls, chronic conditions requiring daily monitoring, and behavioral issues that make unsupervised living unsafe.
Have these records ready before the assessment:
- A physician letter detailing your diagnoses, functional limitations, and the level of care you need.
- Discharge summaries from recent hospitalizations, especially those showing declining function.
- Specialist reports from neurology, cardiology, or other providers documenting chronic conditions.
- A complete list of prescriptions, dosages, and the condition each medication treats.
If you are applying for home and community-based services rather than nursing home care, the physician may need to certify that you would require institutionalization without the services, because the state still needs to confirm you meet the same medical threshold.
Protections If You Have a Spouse at Home
When one spouse needs long-term care and the other stays at home, federal law prevents Medicaid from impoverishing the healthy spouse under 42 U.S.C. § 1396r-5.4Office of the Law Revision Counsel. 42 USC 1396r-5 – Treatment of Income and Resources for Certain Institutionalized Spouses
The Community Spouse Resource Allowance is the portion of the couple’s combined assets the at-home spouse keeps. In 2026, the federal minimum is $32,532 and the maximum is $162,660.3Centers for Medicare & Medicaid Services. 2026 SSI and Spousal Impoverishment Standards Some states let the community spouse keep half the couple’s total countable assets up to that cap. Others apply the minimum floor regardless of total assets. The allowance is set when the institutionalized spouse enters care, not when the application is filed, so document your combined assets as early as possible.
The community spouse also gets a monthly income allowance drawn from the institutionalized spouse’s income. In 2026, that allowance has a federal floor of $2,643.75 and a ceiling of $4,066.50 per month.3Centers for Medicare & Medicaid Services. 2026 SSI and Spousal Impoverishment Standards The exact figure depends on the community spouse’s own income and housing costs. If the community spouse’s independent income already exceeds the floor, no allowance is added. If housing costs push needs above the floor, the allowance can rise to the ceiling. A community spouse who thinks the standard allowance is too low can request a fair hearing to raise it.
Completing and Submitting the Application
Start by contacting your state Medicaid agency or local department of social services for the correct forms. Most states offer an online portal through their health care agency, and paper forms are available if you prefer. The application asks for personal information (Social Security numbers, dates of birth, residency documents), a listing of every income source, and current balances for every financial account.
Describe your exempt assets, especially your home, so they are not mistakenly counted. If a family member or attorney is helping you, complete the authorized representative section. Without that designation, the agency cannot share case details with anyone but you.
Organize supporting documents to match the order of the application. Each account listed should have a recent statement attached. Medical records and physician statements go together in a separate section. Sign and date every signature line before submitting. Missing signatures are one of the most common reasons applications get returned.
Submit through whichever channel your state supports:
- Online portal, uploading digital copies and saving the confirmation number.
- Certified mail with return receipt requested, giving you proof of the delivery date.
- In person at your local office, asking for a date-stamped receipt.
Keep copies of everything you send. If files are misplaced, having your own set avoids starting over.
Timelines and Retroactive Coverage
Federal regulations give the agency 45 calendar days to decide most applications, or 90 days if the application is based on a disability.5eCFR. 42 CFR 435.912 – Timely Determination and Redetermination of Eligibility During that window, a worker reviews your financial records, verifies income, and checks for flagged transfers during the look-back.
Expect a Request for Information if anything is missing or unclear. These come with tight deadlines, often 10 to 15 business days. Respond quickly. Missing the deadline gives the agency grounds to deny your application and force you to start over. The agency may also schedule a phone or in-person interview to clarify records or ask about specific transactions. After the review, you’ll receive a Notice of Action that approves the application, applies a transfer penalty, or denies coverage. That notice must explain the reason and your right to appeal.
If you had medical expenses in the months before applying, Medicaid can cover them retroactively for up to three months before your application month, as long as you were eligible during that time.6Office of the Law Revision Counsel. 42 USC 1396a – State Plans for Medical Assistance Apply in April 2026, and Medicaid can pay for covered services from January, February, and March 2026 if you met the criteria then. If you entered a nursing facility before submitting, keep every bill from that period.
If You Are Denied
A denial isn’t final. Federal law guarantees every applicant the right to a fair hearing if a claim is denied or not acted on promptly.7eCFR. 42 CFR Part 431 Subpart E – Fair Hearings for Applicants and Beneficiaries You generally have up to 90 days from the mailing date of the denial to request a hearing. At the hearing, you can present evidence, bring witnesses, and argue the agency applied the rules incorrectly.
Common reasons for denial include incomplete documentation, countable assets over the limit, unresolved transfer penalties, or a level-of-care assessment that found insufficient medical need. Read the denial letter carefully to identify which criterion you failed. If the problem is a missing bank statement, a transfer that has a valid explanation, or a medical record that wasn’t included, reapplying with the corrected documentation is often faster than a hearing.
What Happens After the Recipient Dies: Estate Recovery
Medicaid long-term care isn’t free in the final accounting. After a recipient dies, states are required by federal law to seek recovery from the estate for the cost of nursing facility services and other long-term care benefits paid.2Office of the Law Revision Counsel. 42 USC 1396p – Liens, Adjustments and Recoveries, and Transfers of Assets In practice, this often means the family home is sold to repay Medicaid after the recipient dies.
Exceptions apply. States cannot pursue estate recovery when the deceased is survived by a spouse, a child under 21, or a child of any age who is blind or disabled.8Medicaid.gov. Estate Recovery If a surviving spouse is alive, the claim is deferred, not forgiven. Once both spouses have died and no protected dependents remain, the state pursues whatever is left.
States must also offer hardship waivers when recovery would cause undue hardship to an heir. Typical qualifying situations include an heir who has been living in the property as their only home for an extended period before the recipient’s death, or an heir who depends on estate property for their livelihood. If your circumstances fit, request the waiver in writing from your state Medicaid agency as soon as you receive the recovery notice.