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

Last updated: December 29, 2021

 

Tennessee Medicaid Definition

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

Medicaid is a wide-ranging, jointly funded state and federal health care program for low-income individuals of all ages. While there are many different Medicaid eligibility groups, this page focuses on eligibility for elderly Tennessee residents, aged 65 and over. Specifically, long-term care is covered. In addition to nursing home care, assisted living services, and adult foster care services, Tennessee Medicaid pays for many non-medical support services that help frail seniors remain living in their homes.

  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 varying eligibility requirements and benefits. Further complicating eligibility is 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 – This an entitlement program; Anyone who is eligible will receive assistance. Benefits are provided only in nursing homes.

2) Medicaid Waivers / Home and Community Based Services (HCBS) – This is not an entitlement program; The number of participants is limited and wait lists may exist. Intended to delay and prevent nursing home admissions, services are provided at home, adult day care, adult foster care, or in assisted living. More about Waivers.

3) Regular Medicaid / Aged, Blind and Disabled – This is an entitlement program; Anyone who meets the eligibility requirements will receive benefits. Various long-term care services, such as personal care assistance or adult day care, may be available.

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

2022 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 $2,523 / month* $2,000 Nursing Home $5,046 / month ($2,523 / month per spouse)* $4,000 ($2,000 per spouse) Nursing Home $2,523 / month for applicant* $2,000 for applicant & $137,400 for non-applicant Nursing Home
Medicaid Waivers / Home and Community Based Services $2,523 / month $2,000 Nursing Home or “At Risk” $5,046 / month ($2,523 / month per spouse) $4,000 ($2,000 per spouse) Nursing Home or “At Risk” $2,523 / month for applicant $2,000 for applicant & $137,400 for non-applicant Nursing Home or “At Risk”
Regular Medicaid / Aged Blind and Disabled $841 / month $2,000 Help with ADLs $1,261 / month $3,000 Help with ADLs $1,261 / month $3,000 Help with ADLs
*All of a beneficiary’s monthly income with the exception of a personal needs allowance of approximately $50, Medicare premiums, and an income allowance for a non-applicant spouse (if applicable) must go towards nursing home costs.

 

What Defines “Income”

Any income that a Medicaid applicant receives is counted. 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. Covid-19 stimulus checks and Holocaust restitution payments do not count as income and have no impact on Medicaid eligibility.

When only one spouse of a married couple is applying 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. However, the non-applicant spouse (also called a community spouse) may be entitled to a Minimum Monthly Maintenance Needs Allowance (MMMNA) from their applicant spouse. The MMMNA is a spousal impoverishment rule and is the minimum amount of income a non-applicant spouse is said to require to avoid poverty. The MMMNA is $2,288.75 (effective 7/1/22 – 6/30/23). If a non-applicant’s income falls under $2,288.75 / month, income can be transferred from the applicant spouse to the non-applicant spouse, bringing their monthly income up to $2,288.75.

In Tennessee, a non-applicant spouse can further increase their spousal income allowance if their housing and utility costs exceed a “shelter standard” of $686.63 / month (effective 7/1/22 – 6/30/23). However, in 2022, in no case can a spousal income allowance put a non-applicant’s income over $3,435 / month. This is the Maximum Monthly Maintenance Needs Allowance. More on how the spousal income allowance is calculated.

Income is counted differently when only one spouse applies for Regular Medicaid; The income of both the applicant spouse and the non-applicant spouse is counted towards the applicant’s income eligibility. More on how Medicaid counts income.

 

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, Medicaid does not count all assets. Exemptions include personal belongings, household furnishings, an automobile, irrevocable burial trusts, and generally one’s primary home. For the home to be exempt, a Medicaid applicant must live in it or have intent to return and their home equity interest cannot be greater than $636,000 (in 2022). The amount of the home’s value owned by the applicant is their home equity interest. The home is also exempt, regardless of the applicant’s circumstances, if a non-applicant spouse lives in it.

 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, Tennessee’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.

All assets of a married couple are considered jointly owned regardless of the long-term care Medicaid program for which one is applying. However, the non-applicant spouse of a Medicaid nursing home or Waiver applicant is permitted a Community Spouse Resource Allowance (CSRA). In 2022, the community spouse (the non-applicant spouse) can retain 50% of the couples’ joint assets, up to a maximum of $137,400, as the chart indicates above. If the community spouse’s half of the assets is under $27,480, 100% of the assets, up to $27,480 can be retained by that spouse.

Tennessee has a 60 month (5-year) Medicaid Look-Back Period that immediately precedes one’s date of Medicaid application. During this period, Medicaid checks to ensure no assets were gifted or sold for less than fair market value. If this has been done, Medicaid assumes it was done to meet the asset limit. Persons who violate the look back rule are penalized with a period of Medicaid ineligibility.

 Non-Financial Eligibility Requirements: For Tennessee long-term care Medicaid eligibility, an applicant’s functional need is a factor. For nursing home Medicaid and Medicaid Waivers, a nursing facility level of care (NFLOC) is required. Additional eligibility requirements might be required for certain benefits. For example, in order for one to receive a personal emergency response system, an inability to safely and independently live at home without it might be required. For long-term care services via the Regular Medicaid program, a functional need with the activities of daily living is required, but a NFLOC is not necessarily required.

 

Qualifying When Over the Limits

Elderly Tennessee residents (65 and over) who do not meet the eligibility requirements in the table above can still qualify for Medicaid.

1) Qualified Income Trusts (QIT’s) – Also called Miller Trusts, QITs allow a way for persons over Medicaid’s income limit to still become eligible for Medicaid nursing home care or a Medicaid Waiver. Income deposited into this type of irrevocable trust no longer counts as income for eligibility purposes. Irrevocable means that the terms of the trust cannot be changed or canceled. In a nutshell, one’s “excess” income (over Medicaid’s limit) is deposited into the QIT. A designated trustee manages the account and can only use trust funds for 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.

2) Asset Spend Down – Persons over Medicaid’s asset limit can still become eligible by “spending down” excess assets on non-countable ones. 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. One must exercise caution when spending down assets to avoid violating Medicaid’s look back rule. It is recommended one keep documentation of how assets were spent as proof this rule was not violated. Our spend down calculator can assist persons in determining if they might have a spend down.

3) 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 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.
Read more or connect with a Medicaid planner.

 

Specific Tennessee Medicaid Programs

1) CHOICES in Long-Term Services and Supports Program – Services offered under the CHOICES Waiver are intended to help nursing home qualified individuals to live outside of nursing homes, in their own homes, the homes of their loved ones, adult foster care homes, or assisted living residences. Benefits may include adult day care, personal care, medical alert devices, transportation assistance, and many others.

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

 

How to Apply for Tennessee Medicaid

Seniors can apply for TennCare online at TennCare Connect, by calling 855-259-0701, or by submitting a completed paper application (towards the bottom of the webpage). Persons can also apply in person at their local DHS office. Those who already receive TennCare benefits, but wish to receive long-term services and supports via CHOICES, should contact their TennCare health plan. Those who are not TennCare recipients, but who would like to receive services via CHOICES, should contact their local AAAD (Area Agency on Aging and Disability) office. The Long-Term Services & Supports Help Desk ca be reached at 877-224-0219 for questions and assistance.

Prior to applying for Tennessee Medicaid, it is imperative that seniors are certain that all eligibility requirements (as discussed above) for the program in which they are applying are met. Persons who have excess income and / or assets, or are uncertain if they meet the eligibility criteria, should seriously consider Medicaid planning for the best chance of acceptance into a Medicaid program. For general information about the long-term care Medicaid application process, click here.

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