There is no easy answer to this question, as the answer is state specific. In some states your father’s IRA would disqualify your mother from Medicaid, and in other states, it would not.
Let’s back up and lay some groundwork. When one spouse of a married couple applies for nursing home Medicaid, the assets of both spouses are considered when determining eligibility. Stated differently, the assets are considered jointly owned and the couple must have assets at or below a certain level in order for the applicant spouse to meet Medicaid’s asset limit.
The asset limit varies a bit depending on the state in which one resides. However, generally speaking, as of 2019, the applicant spouse (the institutionalized spouse) is able to retain up to $2,000 and the non-applicant spouse (the community spouse) is able to keep up to $126,420 of the couple’s assets. (The assets the non-applicant spouse is able to keep is called a community spouse resource allowance). If the couple’s assets are greater than the allowable amounts, the applicant spouse is not eligible for Medicaid until the excess assets are “spent down” to the asset limit. (Learn more about asset spend down here).
There are several assets that are not counted towards Medicaid’s asset limit. This includes the couple’s primary home (given the non-applicant spouse continues to live in it), household furnishings and appliances, a motor vehicle, and in some states, IRAs.
At this time, approximately 50% of the states do not count a non-applicant spouse’s IRA. However, some of these states require that the IRA owner be receiving the required minimum distribution in order for the IRA to be exempt. Worth noting, there are also some states that do not count the applicant spouse’s IRA, most of which require the required minimum distribution be taken. (To see which states do not count the non-applicant spouse’s IRA, and which states require the owner to take the required minimum distribution, click here.)
To summarize, in the states that count your father’s IRA towards Medicaid’s asset limit, your mother could be disqualified from receiving nursing home benefits. Of course, this is dependent on the value of the IRA has and the amount of other assets owned by your parents.