Maryland Medicaid Eligibility for Long-Term Care: Income & Asset Limits

Maryland Medicaid Long-Term Care Definition

Medicaid is a health care program for low-income individuals of all ages. While there are varying coverage groups, the focus here is long-term care Medicaid eligibility for elderly Maryland residents, aged 65 and over. In addition to nursing home care and care services in adult foster care homes and assisted living residences, MD Medicaid pays for non-medical support services to help frail seniors live at home. There are three categories of Medicaid long-term care programs for which Maryland seniors may be eligible.

1) Institutional / Nursing Home Medicaid – An entitlement; anyone who is eligible will receive assistance. Benefits are provided only in nursing homes.

2) Medicaid Waivers / Home and Community Based Services (HCBS) – Not an entitlement; there are a limited number of participants and waiting lists may exist. Intended to prevent and delay nursing home admissions, benefits are provided at home, adult day care, adult foster care, or in assisted living. More on Waivers.

3) Regular Medicaid / Aged Blind and Disabled (ABD) – An entitlement; meeting the eligibility requirements ensures one will receive benefits. Limited long-term care services, such as personal care assistance or adult day care, may be available.

In Maryland, Medicaid is also called Medical Assistance, or simply MA. The program that provides long-term care for the aged, blind, and disabled is called Long Term Services and Supports (LTSS). While Medicaid is jointly funded by the state and federal government, it is state-administered within federally set guidelines. The Maryland Department of Health is the administering agency.

Income & Asset Limits for Eligibility

The three categories of long-term care Medicaid programs have differing financial and medical (functional) eligibility requirements. Further complicating financial eligibility is that the criteria changes annually, varies with marital status, and Maryland offers multiple pathways towards eligibility.

The table below provides a quick reference to allow seniors to determine if they might be immediately eligible for long-term care from a Maryland Medicaid / Medical Assistance program. Alternatively, one can take the Medicaid Eligibility Test. IMPORTANT: Not meeting all of the criteria does not mean one is ineligible or cannot become eligible for Medical Assistance. More.

Income Definition & Exceptions

Countable vs. Non-Countable Income
Almost any income from any source received by a Medicaid applicant is counted towards Medicaid’s income limit. Examples include employment wages, alimony payments, pension payments, Social Security Disability Income, Social Security Income, and stock dividends. Nationally, Holocaust restitution payments are not counted as income. While many states exclude VA Aid & Attendance benefits, which is above and beyond the Basic VA Pension, MD considers it countable income.

Treatment of Income for a Couple
When only one spouse of a married couple applies for Nursing Home Medicaid or a Medicaid Waiver, only the income of the applicant is counted. This means the income of the non-applicant spouse is disregarded and does not impact their spouse’s income eligibility. The non-applicant spouse, however, may be entitled to a Minimum Monthly Maintenance Needs Allowance (MMMNA) / Spousal Income Allowance from their applicant spouse. The MMMNA is a Spousal Impoverishment Provision and is the minimum amount of monthly income a non-applicant spouse is said to require to avoid poverty. In MD, the MMMNA is $2,555 (eff. 7/1/24 – 6/30/25). If a non-applicant’s monthly income falls under $2,555, income can be transferred to them from their applicant spouse, bringing their income up to this level.

A non-applicant spouse can further increase their Spousal Income Allowance if their housing and utility costs exceed a “shelter standard” of $766.50 / month (eff. 7/1/24 – 6/30/25). However, in 2024, a Spousal Income Allowance cannot push a non-applicant’s total monthly income over $3,853.50. This is the Maximum Monthly Maintenance Needs Allowance.  More about how this allowance is calculated.

Income is counted differently when only one spouse applies for Regular Medicaid / Aged Blind and Disabled; the income of both the applicant spouse and the non-applicant spouse is calculated towards the applicant’s income eligibility. Furthermore, there is no Monthly Maintenance Needs Allowance for a non-applicant spouse. More on how Medicaid counts income.

Asset Definition & Exceptions

Countable vs. Non-Countable Assets
The value of countable assets are added together and counted towards Medicaid’s asset limit. This includes cash, stocks, bonds, investments, bank accounts (credit union, savings, and checking), and real estate in which one does not reside. In MD, IRAs are also counted. There are also many assets that are considered exempt (non-countable). Exemptions include personal belongings, household furnishings, an automobile, burial spaces, and generally one’s primary home.

Treatment of Assets for a Couple
All assets of a married couple are considered jointly owned. This holds true regardless of the long-term care Medicaid program for which one is applying and regardless of if one or both spouses are applicants. Spousal Impoverishment Rules, however, permit the non-applicant spouse of a Nursing Home Medicaid or Waiver applicant a Community Spouse Resource Allowance (CSRA). In 2024, the community spouse (the non-applicant spouse) can retain 50% of the couple’s assets, up to a maximum of $154,140. If the non-applicant’s share of the assets falls under $30,828, 100% of the assets, up to $30,828 can be retained by the non-applicant.

Medicaid’s Look-Back Rule
Maryland has a 60-month Medicaid Look-Back Period that immediately precedes one’s Nursing Home Medicaid or Waiver application date. During this period, Medicaid checks to ensure no assets were gifted or sold under fair market value. If this has been done, the Medicaid agency assumes it was done to meet Medicaid’s asset limit. For persons who violate the Look-Back Rule, a Penalty Period of Medicaid ineligibility is calculated.  There is no Look-Back Period for Regular Medicaid.

The U.S. Federal Gift Tax Rule does not extend to Medicaid eligibility. In 2024, this rule allows one to gift up to $18,000 per recipient without filing a Gift Tax Return. Gifting under this rule violates Medicaid’s Look-Back Period.

Maryland Medicaid Home Exemption Rules

For home exemption, the Medicaid applicant or their spouse must live in their home. If there is no spouse in the home, there is a home equity interest limit of $713,000 (in 2024). Home equity is the value of the home after subtracting any outstanding debt against it. Equity interest is the amount of home equity owned by the applicant. Furthermore, if there is not a spouse in the home, and the Medicaid applicant does not live there, the applicant must have Intent to Return. For Regular Medicaid, there is no home equity interest limit. Other exemptions exist.

While one’s home is usually exempt from Medicaid’s asset limit, it is not exempt from Medicaid’s Estate Recovery Program. Following a long-term care Medicaid beneficiary’s death, Maryland’s Medicaid agency attempts reimbursement of care costs through whatever estate of the deceased still remains. This is often the home. Without proper planning strategies in place, the home will be used to reimburse Medicaid for providing care rather than going to family as inheritance.

Medical / Functional Need Requirements

An applicant must have a functional need for long-term care Medicaid. For Nursing Home Medicaid and Medicaid Waivers, a Nursing Facility Level of Care (NFLOC) is required. Furthermore, some program benefits (i.e., home modifications) may require additional criteria be met, such as the inability to safely live independently without modifying the home. For long-term care services via the Regular Medicaid program, a functional need with the Activities of Daily Living (ADLs) is required, but a NFLOC is not necessarily required.

Qualifying When Over the Limits

For Maryland elderly residents (aged 65 and over), who do not meet the financial eligibility requirements above, there are other ways to qualify for long-term care Medicaid.

1) Medically Needy Pathway – Maryland’s ABD (Aged, Blind, or Disabled) Spenddown Program allows seniors who are over Medicaid’s income limit to become income-eligible by “spending down” their income on medical expenses. This may include medical care/treatment/supplies, Medicare premiums, and prescription drugs. In 2024, the Medically Needy Income Limit (MNIL) in MD is $350 / month for an individual and $392 / month for a couple. The “spenddown” amount, which can be thought of as a deductible, is the difference between one’s monthly income and the MNIL. In MD, it is calculated for a 6 month period. Once the “spenddown” is met, one will be income-eligible for the remainder of the period. The Medically Needy Asset Limit is $2,500 for an individual and $3,000 for a couple.

2) Asset Spend Down – Seniors who have assets over Medicaid’s limit can still become asset-eligible by “spending down” extra assets on non-countable ones. Examples include making home accessibility and safety modifications (i.e., addition of wheelchair ramps, stair lifts, pedestal sinks, and replacing carpet with a more wheelchair friendly surface), prepaying funeral and burial expenses, and paying off debt. Remember, assets cannot be gifted or sold under fair market value, as doing so violates Medicaid’s Look-Back Rule. It is recommended one keep documentation of how assets were spent as proof the Look-Back Rule was not violated.

3) Medicaid Planning – The majority of persons considering Medicaid are “over-income” and / or “over-asset”, but they still cannot afford their cost of care. For these persons, Medicaid Planning exists. By working with a Medicaid Planning Professional, families can employ a variety of strategies to help them become Medicaid-eligible, as well as to protect their home from Medicaid’s Estate Recovery Program. Connect with a Medicaid Planner.

Specific Maryland Medicaid Programs

In addition to paying for nursing home care, MD Medicaid offers the following programs relevant to the elderly that help them to live at home or “in the community”.

1) Community Options Medicaid Waiver (CO) – Also called the Home and Community Based Options Waiver (HCBOW), and previously called the Waiver for Older Adults, this program provides services to help persons live independently at home or in an assisted living residence. This program is currently only accepting applications from state residents who reside in Medicaid-funded nursing homes and wish to transition back into the community. Those who reside in the community can have their name added to a “registry” (a waiting list) and will be notified when they can submit an application for waiver services.

2) Community Personal Assistance Services (CPAS) – Personal care assistance and nurse monitoring are provided under the state Medicaid program, which means there are no waiting lists for services. Program participants are able to self-direct their own care, allowing them to hire the caregiver of their choosing, including their spouse or adult child.

3) Community First Choice Program (CFC) – A state plan option that enables program participants to receive a variety of care assistance and support, such as personal assistance, meal delivery, home modifications for accessibility, assistive technology, and personal emergency response systems. Program participants are able to self-direct their own care, meaning they can hire, train, and supervise the care provider of their choice. Since these services are part of the regular state plan Medicaid, there are no waiting lists.

4) Medical Day Care Services Waiver (MDCSW) – Medical day care, such as skilled nursing services and physical therapy, in adult day centers for seniors and adults with disabilities who require a level of care consistent with nursing home care.

5) Increased Community Services (ICS) – Transitional services are available for institutionalized adults who are physically disabled and frail seniors who wish to return to living at home or an assisted living facility. Supportive services include home modifications, personal care assistance, meal delivery, and assistive technology. The number of participant slots is limited to 100.

6) Program of All-Inclusive Care for the Elderly (PACE) – The benefits of Medicaid, including long-term care services, and Medicare are combined into one program. Additional benefits, such as dental and eye care, may be available.

7) Money Follows the Person – This federal program helps institutionalized persons who are eligible for Medicaid to transition back home or into the community.

How to Apply for Maryland Medicaid

Seniors can apply for Maryland Medicaid / Medical Assistance online at myMDTHINK or in person at their local Social Services Office. Additionally, a completed Application for Assistance (for Regular Medicaid) or Long-Term Care / Waiver Medical Assistance Application may be submitted to one’s local Social Services Office. The application process may vary based on the program for which one is applying. One’s local Area Agency on Aging (AAA) might be helping in answering questions and providing application assistance.

Before submitting a Medicaid application in Maryland, it is extremely important that seniors are confident that all eligibility requirements are met. If one does not meet the criteria, or is unsure, Medicaid Planning is strongly suggested. The Medicaid application process can be both complicated and lengthy, and if not done correctly, can result in denial or delay of benefits. Familiarizing oneself with general information about the application process for long-term care Medicaid can be helpful.