Just want to make sure I'm understanding Medicaid correctly

This is how the NH/CS could work:
Dad just left hospital after being there for surgery after a bad fall and now in rehab at a SNF. Dad’s Medicare and whatever he has for his supplemental health insurance is paying for rehab. Or Dads Medicare Advantage is paying for his rehab.

Usual reach post hip surgery rehab for him (with his other health issues) is a 28 day stay. So 28 days to figure out if he will sadly need to stay in a NH and if so, can be eligible for LTC Medicaid.
- His income is $2500; Moms is $1200. 50K in savings.
They have a mortgage & property insurance costs of $1500 a mo.
-They have credit card debt and mom has higher than usual drug costs that run her $500 mo. plus the usual costs of living.
-Their State has $2,901 income max & 2K asset max for the NH resident & 128K asset max for a Community spouse.

Their State allows the CS to have up to $128K…. so she gets 126k of it into her own bank a cout and he gets the 2K max LTC Medicaid allows.

This mom absolutely needs some of his income to keep her household afloat and to stay living in the community. Mom at a minimum needs at least $800 from him to cover the minimum costs of mortgage and drugs she on her own does NOT have the income to afford. Atty is able to establish this plus take into account the COL / Costs of living for their city and comes up with mom needing more like $1500 extra every month. Voila! Mom gets a $1500 CSRA waiver and is able to retain $1500 from her hubs $2500 SSA $ that would otherwise go to the NH as his required by Medicaid Share of Cost rules.
- They live in TX & it has a Personal Needs Allowance of $75 a mo. That PNA is $ dad can keep and if it is not fully spent it then becomes an asset*. So Dad now - due to the waiver and the PNA - only pays the NH $925 a mo as his required Share of Cost (2500 -1500-75=1500)

* Dad is allowed to have up to 2K in exempt asssts. So mom & you have to be mindful that his PNA $ gets spent so that he never ever goes over the 2K max. Most States do $50-$75 PNA and it tends to totally get used up btwn beauty/barber shoppe costs and clothing replacement. But you have to pay attention to not letting it go over the magic 2K limit.

CS/NH situations are way more complex than an application for an individual. To me, it’s always work for a savvy elder attorney who understands how the Medicaid program is administered in your state
and not a DIY.

OK as the RM is in underwriting, WITH NO SIGNATURES by your parents, time is of the essence to get the RM cancelled. Fully expect push back from the RM lender and perhaps even outright lies from them that it has to be done. If the folks get this type of push back, they or you can remind the, that RM that are HECMs involve oversight by HUD and FHA; and the Feds take the ability for elders to be able to change their minds quite seriously. As nothing was signed, that RM lender can essentially go pound sand as it ain't happening. Like 90%+ of all RM are HECMs so those Federal rules have to be observed.

Medicare is health insurance and IT IS NOT A FACTOR for paying for his room&board costs to be a long term custodial care resident in his State in a SNF. That is done by your States LTC Medicaid program. It totally allows for the situation that 1 spouse is in a Nh/SNf and the other healthier spouse remain in the home as the “community spouse”. Rules for NH & CS situation vary bu State but this is its overall:
- he will segregate his income, like his SSA $ and any other pensions, retirements he gets. It will - for most State have to be under $2,901.00 per month. That income of his will - almost all - become his Share of Cost or Resident Responsibility each and every mo that is paid to the Nh UNLESS mom can show that she herself needs some of that income of his to enable her to remain as the “Community Spouse”, more below…
- moms own income does NOT factor in for his income eligibility for LTC Medicaid. Mom gets to keep all her income. Unless mom’s income is all on it’s own is a very very high $$$ amount, her income will not matter for his eligibility.
- Assets are dealt with differently…. Some States have a set $ amount that can totally become the CSs. Like tends to be 130K range. But other states halve the assets, splitting it equally btw them.
- most States have for the NH spouse a max of 2K in assets they can have and still be eligible.
- so due to the aboves, they will each need their own separate bank account that gets their own income and share of assets.
- BUT & a BIG BUT! if mom based on her own income just does not have the $ she needs to afford the costs to live in and maintain her household, buy her medications, pay for car/house stuff, etc. then mom can file for CSRA or MMNA. Community Spouse Resource Allowance or Monthly Maintenance Needs Assessment. Think of it as old school style alimony. And she would file for a waiver to have some of hubs income instead of almost all going to become his SOC paid to the Nh instead have some of it to be waived or paid to her. Doing a CSRA / MMNA to me is not a DIY, it’s elder law atty work plus there’s also other things that NH/CS spouse will need to do to keep his eligibility to be assured over time.

A NH tends to never ever bring up the CSRA stuff as it means they will get less $ each month paid to them by your Dad. This is why imho ya need to have an atty that understands LTC Medicaid to shepherd dad’s application, moms CSRA waiver request and do this ASAP.
Why? Well it’s bc for couples most States do a “snapshot” date to which affixes their financial situation. And the snapshot date is affixed to the date he files a LTC Medicaid application. Do NOT file for this yet! This is mucho importante!!!

Why? Well if he was hospitalized and then discharged to a SNF, he entered the SNF as a rehabilitation patient. This is awesome as his health insurance is paying for his rehab stay. This is the period of time that you & mom get on finding and working with an atty asap to get her ready to become a CS and dad a NH LTC Medicaid resident.

There are also other legal stuff that they imo should do and all this takes time. Dads being in rehab as long as possible enables y’all to do what’s needed to get him on LTC medicaid and keep mom financially stable and secure.

Mom will be the Community Spouse. It will depend on how much Mom needs to live on whether Medicaid takes Dads SS check. Mom should not be left impoverished. I would not allow Dad to come home. I would have him trasferred to a LTC facility with Medicaid pending. And yes, I would consult with an Elder Lawyer about how to do this right and protect Mom.

Once Dad needed this kind of care, Mom should have had their assets split. When Dads were gone, then Medicaid could have been applied for. This would have protected Mom.

Hi Peanutty,

I think you are correct but I’m not an attorney.

Please clarify. They have been approved for the RM? It is a done deal or has it not been signed?

please see a CELA level elder law attorney.


“With the help of an Illinois Certified Elder Law attorney Your mom might be able to qualify for a portion of your dad’s social security. This to enable mom to continue to live in their home and not render her indigent. Again, you need a certified elder law attorney well versed in Illinois Medicaid to make sure she is doing the best she can with her situation. “

I posted the above to AI and received the following info.

“In 2026, Illinois Medicaid includes "Spousal Impoverishment" protections specifically designed to prevent a spouse living at home (the community spouse) from becoming indigent when their partner enters a nursing home. 
The following protections apply in 2026 for an Illinois resident:
1. Income Diversion (MMMNA) 
If your mother's personal Social Security income is below the state-mandated threshold, she is entitled to a Minimum Monthly Maintenance Needs Allowance (MMMNA). 
2026 Income Limit: For 2026, the maximum monthly maintenance needs allowance is $4,066.50 (increased from $3,948 in 2025).
The Process: If her income falls below the allowed limit, your father can "divert" a portion of his Social Security income to her to bridge the gap.
Excess Shelter Allowance: If her housing costs (mortgage, rent, taxes, insurance, utilities) are exceptionally high, she may qualify for an even larger portion of his income, up to the 2026 maximum of $4,066.50. 
2. Asset Protection (CSRA)
Your mother can also keep a significant portion of the couple’s joint assets, known as the Community Spouse Resource Allowance (CSRA). 
2026 Asset Limit: As of January 2026, the community spouse can retain up to $162,660in assets (increased from $157,920 in 2025).
Exempt Assets: The primary home and one motor vehicle are generally exempt and do not count toward this asset limit. 
3. Legal Assistance
Because Medicaid rules are adjusted annually and the application process involves complex "spend-down" calculations, consulting an Illinois Certified Elder Law Attorney (CELA) is critical. An attorney can help: 
File for a "fair hearing" or court order to increase the income or asset allowances if the standard limits are insufficient for her survival.
Ensure all transfers of income are documented correctly in the Illinois Integrated Eligibility System (IES) to avoid eligibility penalties. 
To start the process, you can also contact the Illinois Department of Healthcare and Family Services (HFS) or use the ABE Illinois portal to manage existing cases.”

Please clarify on where you are on the RM.

Yes. He can receive Medicaid and Mom can keep their home. STOP the reverse mortgage. It could hurt them badly. When the person who gets the mortgage has to leave the home (say for extended care facility) the mortgage comes due immediately.

Do not get a reverse mortgage now. See an Elder Law Attorney for options and apply for Medicaid for Dad. Mom should have division of assets to protect her portion of marital assets. Her money should not be used for his care.

Contact A family law lawyer as to how best to separate the assets so that if she is able to retain the house, she will have enough for taxes, maintenance and utilities plus groceries and sundries. If the Medicaid exception for spouses is too low, legal separation might be an option.

Here is what Medicaid provides for:

https://www.medicaid.gov/medicaid/eligibility-policy/spousal-impoverishment