South Carolina Medicaid Eligibility for Long Term Care: Income & Asset Limits

South Carolina Medicaid Long-Term Care Definition

Medicaid is a health care program for low-income individuals of all ages. While there are many different coverage groups, this page is focused on long-term care Medicaid eligibility for South Carolina senior residents (aged 65 and over). In addition to providing care in nursing homes, community residential care facilities (assisted living facilities), and adult foster care homes, SC Medicaid pays for non-medical services and supports to help frail seniors live in their homes. There are three categories of long-term care Medicaid programs for which South Carolina seniors may be eligible.

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

2) Medicaid Waivers / Home and Community Based Services (HCBS) – Not an entitlement; the number of participants is limited and waiting lists may exist. Intended to delay the need for nursing home admissions, services are provided at home, adult day care, adult foster care, or in community residential care facilities. More on Waivers.

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

In South Carolina, Medicaid is called Healthy Connections. While the Medicaid program is state and federally funded, it is run by the state under federally set parameters. The South Carolina Department of Health and Human Services (SCDHHS) is the administering agency.

Income & Asset Limits for Eligibility

The three categories of Medicaid long-term care programs have varying financial and medical eligibility criteria. Further complicating eligibility is that the financial requirements change annually, vary with marital status, and that South Carolina 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 South Carolina Medicaid 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 Medicaid in SC. 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. Examples include employment wages, alimony payments, pension payments, Social Security Disability Income, Social Security Income, IRA withdrawals, and stock dividends. Nationally, Holocaust restitution payments are not counted as income. Furthermore, in SC, the VA Aid & Attendance and Housebound Allowances, which are above and beyond the Basic VA Pension, do not count as 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 applicant’s income is counted towards the income limit. This means the income of the non-applicant spouse does not impact their spouse’s income eligibility. The non-applicant spouse, however, may be entitled to a Monthly Maintenance Needs Allowance (MMNA) from their applicant spouse to prevent spousal impoverishment. In 2024, the MMNA in South Carolina is $3,853.50 / month. If a non-applicant spouse has monthly income under this amount, income can be transferred to them from their applicant spouse to bring their monthly income up to this level. A non-applicant spouse who already has a monthly income of $3,853.50 or more is not entitled to a MMNA / Spousal Income Allowance.

Income is counted differently when only one spouse applies for Regular Medicaid / Aged Blind or Disabled; the income of both the applicant spouse and non-applicant spouse is calculated towards the applicant’s income eligibility. Furthermore, a non-applicant spouse is not entitled to a Monthly Maintenance Needs Allowance. 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. There are also many assets that are exempt (non-countable). Exemptions include personal belongings, such as clothing and jewelry, household furnishings, one vehicle, up to $1,500 per spouse in burial funds, the cash value of life insurance policies up to a combined face value of $10,000, and generally one’s primary home. In South Carolina, IRAs / 401Ks are exempt if they are in “payout status”. This means that one’s Required Minimum Distribution (RMD) is being withdrawn

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, the non-applicant spouse of a Nursing Home Medicaid or Waiver applicant is permitted a Community Spouse Resource Allowance (CSRA). This is a Spousal Impoverishment Provision, and in 2024, allows the community spouse (the non-applicant spouse) to retain up to $66,480 of the couple’s assets.

Medicaid’s Look-Back Rule
It is vital that one does not give away assets or sell them for under fair market value within 60-months of applying for Nursing Home Medicaid or a Medicaid Waiver in South Carolina. Doing so is a violation of Medicaid’s Look-Back Rule, a period that immediately precedes one’s Medicaid application date in which all asset transfers are reviewed. Violating this rule results in a Penalty Period of Medicaid ineligibility.

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 5-year Look-Back Period.

South Carolina 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 the home’s equity that is owned by the applicant. Furthermore, if there is not a spouse in the home, and the Medicaid applicant does not live in it, 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 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, South Carolina’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 long-term care Medicaid. For Nursing Home Medicaid and Medicaid Waivers, a Nursing Facility Level of Care (NFLOC) is required. Furthermore, additional criteria may need to be met for specific program benefits. For example, for a Waiver to cover the cost of home modifications, an inability to safely live at home without modifications may 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 South Carolina elderly residents, aged 65 and over, who do not meet the financial eligibility requirements above, there are other ways to qualify for Medicaid.

1) Qualified Income Trusts (QIT’s) – Also called Miller Trusts, or Income Trusts in SC, QITs offer a way for Medicaid applicants over the Medicaid income limit (called a “Medicaid Cap” in SC) to still become income-eligible for Nursing Home Medicaid or a Medicaid Waiver. For eligibility purposes, money deposited into this type of trust does not count towards Medicaid’s income limit. In simple terms, one’s excess income (over the Medicaid Cap) is directly deposited into a trust, in which a trustee is named, giving that individual legal control of the money. Trust funds can only be used for very specific purposes, such as paying for long-term care services / medical expenses accrued by the Medicaid enrollee. The account must be irreversible, meaning once it has been established, it cannot be changed or canceled, and the South Carolina Department of Health and Human Services must be listed as the remainder beneficiary.

2) Asset Spend Down – Persons who have countable assets over South Carolina’s asset limit can “spend down” assets on ones that are non-countable. Examples include making home modifications (wheelchair ramps, roll-in showers, and stair lifts), home improvements (replacing faulty electrical wiring, updating plumbing, and replacing old water heaters), vehicle modifications (wheelchair lifts, adaptive control devices, and floor modifications to allow one to drive from a wheelchair), prepaying funeral and burial expenses, and paying off debt. Remember, assets cannot be gifted or sold under fair market value, as this 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 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 South Carolina Medicaid Programs

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

1) South Carolina Community Choices Waiver – Provides assistance for elderly and disabled individuals who require a level of care consistent to that which is provided in a nursing home, but who wish to remain living in their own homes, adult foster care homes, or community residential care facilities. A variety of benefits are available, including home modifications, adult day health care, specialized medical equipment, and assistance with Activities of Daily Living (ADLs), such as bathing, mobility, and eating.

2) Healthy Connections Prime – Provides long-term care services at home and in the community for persons who are “dual eligible” (eligible and enrolled in both Medicaid and Medicare).

3) 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.

4) Money Follows the Person (MFP) – Also called Home Again in South Carolina. This federal program helps institutionalized persons who are eligible for Medicaid to transition back home or into the community.

How to Apply for South Carolina Medicaid

Seniors can apply for SC Medicaid online at Healthy Connections or they can complete and submit the required forms to their local Healthy Connections county office. Forms for Aged Blind or Disabled Medicaid can be found half way down this webpage. Forms for Nursing Home Medicaid or Home and Community Based Services via a Medicaid Waiver can be found at the bottom of this webpage. Since the application process varies based on the program for which a senior is applying, it can be confusing. For Medicaid related questions or for assistance, persons can contact Healthy Connections at 888-549-0820.

Prior to applying for long-term care Medicaid in South Carolina, it is imperative that seniors are certain all eligibility requirements are met. Persons who have income and / or resources in excess of the limit(s) can benefit from Medicaid planning for the best chance of acceptance into a Medicaid program. Familiarizing oneself with general information about the application process for long-term care Medicaid can be helpful.