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

Rhode Island Medicaid Long-Term Care Definition

Medicaid is a health insurance program for low-income individuals of all ages. While this program is available to diverse groups of persons, the focus here is on long-term care Medicaid eligibility for Rhode Island elders, aged 65 and over. In addition to care services in nursing homes, assisted living facilities, and shared living homes (adult foster care), RI Medicaid pays for non-medical services and supports to help frail seniors live at home. There are three categories of Medicaid long-term care programs for which Rhode Island seniors may be eligible.

1) Institutional / Nursing Home Medicaid – An entitlement; anyone who meets the eligibility requirements will receive assistance. Benefits are provided only in nursing home facilities.

2) Medicaid Waivers / Home and Community Based Services (HCBS) – Not an entitlement; there are a limited number of participant slots and waiting lists may exist. Intended to delay the need for nursing home admissions, services and supports are provided at home, adult day care, shared living, or in assisted living. More on Waivers.

3) Regular Medicaid / Elders and Adults with Disabilities (EAD) – An entitlement; as long as eligibility requirements are met, one will receive assistance. Various long-term care services, such as personal care assistance or adult day care, may be available.

Medicaid in Rhode Island is called Medical Assistance (MA). The state’s entire Medicaid program operates under the Rhode Island Comprehensive Demonstration, an 1115 Medicaid Demonstration Waiver. While Medicaid is jointly funded by the state and federal government, it is administered by the state under federally set parameters. The State of Rhode Island Department of Human Services (DHS) is the administering agency.

Income & Asset Limits for Eligibility

The three categories of Medicaid long-term care programs have varying financial and medical (functional) eligibility requirements. Further complicating financial eligibility is that the requirements change annually, varies with marital status, and that Rhode Island offers multiple pathways towards Medicaid 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 Rhode Island Medicaid program. Alternatively, it can be helpful to take the Medicaid Eligibility Test. IMPORTANT: Not meeting all of the criteria does not mean one is ineligible or cannot become eligible for Medicaid in Rhode Island. More.

Income Definition & Exceptions

Countable vs. Non-Countable Income
Nearly any income from any source that a Medicaid applicant receives is counted towards Medicaid’s income limit. This includes employment wages, alimony payments, pension payments, Social Security Disability Income, Social Security Income, Supplemental Security Income, IRA withdrawals, and stock dividends. Nationally, Holocaust restitution payments are not counted as income. Furthermore, in RI, the VA Aid & Attendance Allowance, which is above and beyond the Basic VA Pension, does not count as income.

Treatment of Income for a Couple
When only one spouse of a married couple applies for Institutional 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 the income eligibility of their applicant spouse. 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 Rule and is said to be the minimum amount of monthly income a non-applicant spouse requires to avoid poverty.

In RI, 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). 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 on how this allowance is calculated.

Income is counted differently when only one spouse applies for Regular Medicaid / Elders and Adults with Disabilities; 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. Learn more about how Medicaid counts income.

Asset Definition & Exceptions

Countable vs. Non-Countable Assets
The value of countable assets (also called resources) are added together and count towards Medicaid’s asset limit. This includes cash, stocks, bonds, investments, promissory notes, bank accounts (credit union, savings, and checking), and real estate in which one does not reside. There are also many assets that are not counted; they are exempt from the eligibility limit. Exemptions include personal belongings, such as clothing, household furnishings, an automobile, a burial plot, and generally one’s primary home. In Rhode Island, IRAs and 401Ks are exempt if they are in “payout status”. This means that one is taking their Required Minimum Distribution (RMD).

Treatment of Assets for a Couple
All assets of a married couple are considered jointly owned. This is true regardless of the long-term care Medicaid program for which one is applying and regardless of if one or both spouses are applicants. However, Spousal Impoverishment Rules permit the non-applicant spouse of an Institutional Medicaid or Waiver applicant a Community Spouse Resource Allowance (CSRA).

In 2024, in RI, the CSRA allows the community spouse (the non-applicant spouse) to retain 50% of the couple’s assets, up to a maximum of $154,140. If the non-applicant’s portion of the assets falls under $30,828, 100% of the assets, up to $30,828 can be retained by the non-applicant. The CSRA is not applicable for Regular Medicaid.

Medicaid’s Look-Back Rule
It is vital that one does not give away assets or sell them for less than fair market value within 60-months of applying for Nursing Home Medicaid or a Medicaid Waiver. This is because Rhode Island has a Medicaid Look-Back Period that immediately precedes one’s Medicaid application date. During this 5 year period, Medicaid checks all past asset transfers. If assets have been gifted or sold under fair market value, even by one’s non-applicant spouse, the Medicaid agency assumes it was done to meet Medicaid’s asset limit. Violating the Look-Back Period, even unintentionally, triggers a period of Medicaid ineligibility. The Look-Back Rule does not apply to 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.

Rhode Island 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. There is no home equity interest limit for Regular Medicaid. Other exemptions exist.

While one’s home is generally 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, Rhode Island’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 medical need for Medicaid long-term care. For Institutional Medicaid and Medicaid Waivers, a Nursing Facility Level of Care (NFLOC) is required. Furthermore, for some program benefits, additional eligibility criteria may need to be met. For example, for respite care, an inability to be left unsupervised might be necessary. 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 Rhode Island elderly residents (aged 65 and over) who do not meet the financial eligibility requirements above, there are other ways to qualify for Medicaid.

1) Medically Needy (MN) Pathway – Rhode Island has a Spend-Down Program that allows seniors who are over Medicaid’s income limit to become income-eligible if they have high medical expenses. In simple terms, one may still qualify for Medicaid services by “spending down” their income on private health insurance, unpaid medical bills, care assistance, and medical expenses that Medicaid does not cover. In 2024, the Medically Needy Income Limits (MNILs) are $1,133 / month for an individual and $1,175 / month for a couple. The “spend down” amount, which can be thought of as a deductible, is the difference between one’s monthly income and the MNIL. In RI, one’s “spend down” is calculated for a 6-month period. Once it has been met, one will be income-eligible for the remainder of the period. The asset limit is $4,000 for an individual and $6,000 for a couple.

2) Asset Spend Down – Persons who have assets over Medicaid’s limit can still become asset-eligible by spending down extra assets on non-countable ones. This includes making home modifications (addition of first floor bedrooms, wheelchair ramps, or stair lifts), 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 this 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 long-term 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 Estate Recovery. Connect with a Medicaid Planner.

Specific Rhode Island Medicaid Programs

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

1) Long Term Services and Supports (LTSS) – Operating under the Comprehensive Demonstration Waiver, LTSS are intended to prevent and delay nursing home placement of seniors. Benefits include personal care assistance, personal emergency response systems, home modifications, meal delivery, adult day care, respite care, assisted living services, and more. There is an option for consumer direction, which allows program participants to choose the caregiver of their liking, including their adult children.

2) RIte @ Home – Also called the Caregiver Homes Program or Shared Living Program, Rite @ Home is a benefit under Long Term Services and Supports. A nursing home diversion program, program participants move in with a caregiver, who may be a relative or friend, and the individual provides personal care assistance for the program participant. Other benefits include transportation, homemaker services, chore services, medication reminders, and respite care.

3) Medicaid Preventive Services – Also called Long-Term Services and Supports Preventive Services, this program is related to LTSS above, but is intended for individuals with less severe needs.

4) 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.

5) Money Follows the Person – Also called The Rhode to Home in Rhode Island. This federal program helps institutionalized persons who are eligible for Medicaid to transition back home or into the community.

How to Apply for Rhode Island Medicaid

Elderly residents in Rhode Island can apply for long-term care Medicaid online at HealthyRhode RI, over the phone by calling the Department of Human Services (DHS) at 855-697-4347 (855-MY-RIDHS), or by completing a paper application and mailing it to their local DHS office. Seniors can also apply in person at their local DHS office. The application process may vary based on the program for which one is applying. For application assistance, persons can call the POINT at 401-462-4444.

Prior to submitting a Medicaid application for long-term care in Rhode Island, it is imperative that seniors be positive that all eligibility requirements are met. Persons over the income and / or asset limit(s) can still qualify for benefits with Medicaid Planning. The application process is complicated and documentation is required in addition to the completed application. Familiarizing oneself with general information about the application process can be helpful.