Tennessee Medicaid (TennCare) Income & Asset Limits for Nursing Homes & In-Home Long Term Care

Last updated: May 28, 2018

Tennessee Medicaid Definition

The Medicaid program in Tennessee is called TennCare, and the division that provides long-term care assistance for the elderly is called the Long-Term Services & Supports.

Medicaid is a wide-ranging, jointly funded state and federal health care program for low-income individuals of all ages. However, this page is focused on Medicaid eligibility, specifically for Tennessee residents, aged 65 and over, and specifically for long term care, whether that be at home, in a nursing home, or in assisted living.

  The American Council on Aging now offers a free, quick and easy Medicaid eligibility test for seniors.


Income & Asset Limits for Eligibility

There are several different Medicaid long-term care programs for which Tennessee seniors may be eligible. These programs have slightly different eligibility requirements and benefits. Further complicating eligibility are the facts that the criteria vary with marital status (and if one’s spouse is also applying for Medicaid benefits) and that Tennessee offers multiple pathways towards eligibility.

1) Institutional / Nursing Home Medicaid – is an entitlement (anyone who is eligible will receive assistance) & is provided only in nursing homes.
2) Medicaid Waivers / Home and Community Based Services (HCBS) – limited number of participants. Therefore, wait lists may exist. Provided at home, adult day care, or in assisted living.
3) Regular Medicaid / Aged Blind and Disabled – is an entitlement and is provided at home or adult day care.

The table below provides a quick reference to allow seniors to determine if they might immediately be eligible for long term care via a Medicaid program. Alternatively, one may take the Medicaid Eligibility TestIMPORTANT, not meeting all the criteria below does not mean one is automatically ineligible for Medicaid or cannot become eligible. More.

2018 Tennessee Medicaid / TennCare Long Term Care Eligibility for Seniors
Type of Medicaid Single Married (both spouses applying) Married (one spouse applying)
Income Limit Asset Limit Level of Care Required Income Limit Asset Limit Level of Care Required Income Limit Asset Limit Level of Care Required
Institutional / Nursing Home Medicaid $2,250 / month $2,000 Nursing Home $3,375 / month $4,000 Nursing Home $2,250 / month for applicant $2,000 for applicant & $123,600 for non-applicant Nursing Home
Medicaid Waivers / Home and Community Based Services $2,250 / month $2,000 Help w/ 2 ADLs $3,375 / month $3,000 Help w/ 2 ADLs $2,250 / month for applicant $2,000 for applicant & $123,600 for non-applicant Help w/ 2 ADLs
Regular Medicaid / Aged Blind and Disabled $750 / month $2,000 None $1,125/ month $3,000 None $750 / month $2,000 None


What Defines “Income”

For Medicaid eligibility purposes, any income that a Medicaid applicant receives is counted. To clarify, this income can come from any source. Examples include employment wages, alimony payments, pension payments, Social Security Disability Income, Social Security Income, IRA withdrawals, and stock dividends. However, when only one spouse of a married couple is applying for Medicaid, only the income of the applicant is counted. Said another way, the income of the non-applicant spouse is disregarded. There is also a Minimum Monthly Maintenance Needs Allowance (MMMNA), which is the minimum amount of monthly income to which the non-applicant spouse is entitled. (As of July 2018, this figure falls between $2,057.50 / month and $3,090 / month). This rule allows the Medicaid applicant to transfer income to the non-applicant spouse to ensure he or she has sufficient funds with which to live.


What Defines “Assets”

Countable assets include cash, stocks, bonds, investments, credit union, savings, and checking accounts, and real estate in which one does not reside. However, for Medicaid eligibility, there are many assets that are considered exempt (non-countable). Exemptions include personal belongings, household furnishings, an automobile, irrevocable burial trusts, and one’s primary home, given the Medicaid applicant or their spouse lives in the home and the home is valued under $572,000 (in 2018). For married couples, as of 2018, the community spouse (the non-applicant spouse) can retain up to a maximum of $123,600 of the couple’s joint assets, as the chart indicates above. This, in Medicaid speak, is referred to as the Community Spouse Resource Allowance (CSRA).

It’s important to be aware that Tennessee has a 5-year Medicaid Look-Back Period. This is a period of 60 months in which Medicaid checks to ensure no assets were sold or given away for less than they are worth in order to meet Medicaid’s asset limit. If one is found to be in violation of the look-back period, a period of Medicaid ineligibility will result.


Qualifying When Over the Limits

Tennessee has a Medicaid eligibility income cap, and unlike many states, one is not able to “spend down” excess income on medical expenses in order to qualify for Medicaid. However, for elderly Tennessee residents (65 and over) who do not meet the eligibility requirements in the table above, there are other ways to qualify for Medicaid.

1) Qualified Income Trusts (QIT’s) – A QIT allows a way for one to become eligible for long-term Medicaid nursing home care or HCBS waiver services even if he or she is over the income limit. Also referred to as a Miller Trust, this is an irrevocable trust. In a nutshell, a Medicaid applicant’s income over the Medicaid limit is deposited into a QIT and is not counted towards Medicaid eligibility. A designated trustee manages the account, and the trustee can use the funds for only designated purposes, such as paying unreimbursed medical expenses and health insurance premiums of the Medicaid enrollee. The state of Tennessee must be named as a beneficiary on the account.

Make note, Miller Trusts do not assist one who has assets over the Medicaid qualification limit. Said another way, if one meets the income requirements for Medicaid eligibility, but not the asset requirement, Miller Trusts have no impact on reducing one’s assets. However, one can still meet the asset limit by “spending down” excess assets on non-countable assets. Examples include home modifications (adding a first floor bedroom, remodeling the bathroom to be wheelchair accessible, and adding chair lifts), prepaying funeral and burial expenses, and paying off mortgage, vehicle, and credit card debt.

2) Medicaid Planning – the majority of seniors considering Medicaid are “over-income” or “over-asset” or both, but still cannot afford their cost of long term care. For persons in this situation, Medicaid planning exists. By working with a Medicaid planning professional, families can employ a variety of strategies to help them become Medicaid eligible. Read more or connect with a Medicaid planner.


Specific Tennessee Medicaid Programs

For all Tennessee residents, TennCare will cover the cost of nursing home care if they are financially qualified and, of course, they require nursing home care. TennCare also offers “Home and Community Based Services” (HCBS). HCBS are offered through a program called CHOICES in Long Term Care. Services offered under CHOICES are intended to help nursing home qualified individuals to live outside of nursing homes, in their own homes, in the homes of their loved ones or in assisted living residences. The types of care offered include adult day care, personal care, medical alert devices, transportation assistance and many others. The CHOICES in Long Term Care has limited enrollment and waiting lists may exist.

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