Montana Medicaid Eligibility for Long Term Care: Income & Asset Limits

Montana Medicaid Long-Term Care Definition

Medicaid is a health insurance program for low-income individuals of all ages. While varying groups of Montana residents receive coverage, this page is focused on long-term care Medicaid eligibility for Montana elders, aged 65 and over. In addition to nursing home care, MT Medicaid pays for care services and supports to assist frail seniors in continuing to live at home, in adult foster care, or in assisted living. There are three categories of Medicaid long-term care programs for which Montana seniors may be eligible.

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

2) Medicaid Waivers / Home and Community Based Services (HCBS) – Not an entitlement; there are a limited number of participant enrollment slots and wait lists may exist. Services are intended to delay and prevent nursing home admissions and can be provided at home, adult day care, in adult foster care, or in assisted living. More on Waivers.

3) Regular Medicaid / Aged, Blind and Disabled – An entitlement; if eligibility requirements are met, assistance will be received. Long-term care benefits, such as personal care assistance or adult day care, may be available.

Medicaid is jointly funded by the state and federal government, but is administered by the state under federally set parameters. The Montana Department of Public Health and Human Services (DPHHS) is the administering agency.

Income & Asset Limits for Eligibility

Each of the three Medicaid long-term care programs have varying financial and medical eligibility criteria. Financial requirements change annually, vary based on marital status, and is further complicated due to Montana offering alternative pathways towards 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 Montana Medicaid program. Alternatively, one can take the Medicaid Eligibility Test. IMPORTANT: Not meeting all of the criteria below does not mean one is ineligible or cannot become eligible for Montana Medicaid.  More.

Income Definition & Exceptions

Countable vs. Non-Countable Income
Nearly all income that a Medicaid applicant receives is counted towards Medicaid’s income limit. Countable income 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 MT, the VA Aid & Attendance, 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 Nursing Home Medicaid or a Medicaid Waiver, only the income of the applicant is counted towards the income limit. While the non-applicant spouse’s income is disregarded in determining their spouse’s income eligibility, they may be entitled to a Minimum Monthly Maintenance Needs Allowance (MMMNA) / Spousal Income Allowance from their applicant spouse. The MMMNA is said to be the minimum amount of monthly income a non-applicant spouse requires to avoid living in poverty.

Effective 7/1/23 – 6/30/24, the MMMNA in MT is $2,465. If a non-applicant’s monthly income is under $2,465, income can be transferred to them from their applicant spouse to bring their income up to this amount.

In Montana, a non-applicant spouse can further increase their Spousal Income Allowance if their housing and utility costs exceed a “shelter standard” of $740 / month (eff. 7/1/23 – 6/30/24). However, in 2024, in no case can a Spousal Income Allowance push a non-applicant’s income over $3,853.50 / month. This is the Maximum Monthly Maintenance Needs Allowance. More about how the Spousal Allowance is calculated.

In addition to providing spousal support, the Monthly Maintenance Needs Allowance is effective in lowering the applicant’s countable income for eligibility purposes.

For Regular Medicaid / Aged, Blind and Disabled Medicaid, income is counted differently when only one spouse applies; the income of both the applicant spouse and non-applicant spouse is calculated towards the applicant’s income eligibility. Furthermore, there is no Monthly Maintenance Needs Allowance for a non-applicant spouse. More about how Medicaid counts income.

Asset Definition & Exceptions

Countable vs. Non-Countable Assets

Countable assets (also called resources) are counted 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. In Montana, IRAs and 401K’s are also counted.

There 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 prepaid irrevocable funeral agreements. Irrevocable means the terms of the agreement cannot be changed or cancelled. While there is no limit for irrevocable funeral agreements, if the balance is more than $5,000, any remaining funds must be paid to Montana Medicaid. Revocable funeral agreements up to $1,500, combined life insurance policies up to a total face value of $5,000, and generally one’s primary home are also exempt.

Treatment of Assets for a Couple
All assets of a married couple are considered jointly owned. This is true despite the long-term care Medicaid program for which one is applying and regardless of if one or both spouses are applicants. The non-applicant spouse of a Nursing Home Medicaid or Medicaid Waiver applicant, however, is entitled to a larger amount of the couple’s countable assets. This is called a Community Spouse Resource Allowance (CSRA), and in 2024, allows the non-applicant spouse to keep 50% of the couples’ assets, up to a maximum of $154,140. If the non-applicant’s half falls under $30,828, 100% of the assets, up to $30,828 can be retained by the non-applicant. The Community Spouse Resource Allowance does not apply to Regular Medicaid.

Medicaid’s Look-Back Rule
Montana has a 60-month (5 year) Medicaid Look-Back Period that immediately precedes one’s application date for Nursing Home Medicaid or a Medicaid Waiver. During the “look back”, Medicaid checks all past asset transfers to ensure none were sold or gifted for less than fair market value. This includes asset transfers made by one’s spouse. The Look-Back Rule is meant to discourage persons from gifting assets in order to meet Medicaid’s asset limit. Violating this rule is cause for a Penalty Period of Medicaid ineligibility. The Look-Back Period does not apply to Regular Medicaid.

The U.S. Federal Gift Tax Rule does not extend to Medicaid eligibility. In 2024, the Gift Tax 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.

Montana Medicaid Home Exemption Rules

For the home to be exempt, the Medicaid applicant or their spouse must live in it. If there is no spouse living in the home, there is a home equity interest limit of $713,000 (in 2024). Home equity is the value of the home, minus 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 (MERP). Following a long-term care Medicaid beneficiary’s death, the Montana 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 Nursing Home Medicaid and Medicaid Waivers, a Nursing Facility Level of Care (NFLOC) is required. Moreover, some program benefits, such as home modifications through a Waiver, may require additional eligibility criteria be met. For example, the inability to safely live at home without modifying the home may be necessary. For long-term care services via Regular Medicaid, a functional need with the Activities of Daily Living is required, but a NFLOC is not necessarily required.

Qualifying When Over the Limits

For Montana elderly residents (aged 65 and over) who do not meet the financial eligibility requirements in the table above, there are other ways to qualify for Medicaid.

1) Medically Needy Pathway – Montana has a Spend-Down Program for seniors who have income over Medicaid’s limit. This program allows persons with high medical bills relative to their monthly income to become income-eligible by “spending down” their income on medical expenses. Examples include paying for private health insurance and medical care that Medicaid does not cover. The amount one must “spend down” is the difference between one’s monthly income and MT’s Medically Needy Income Limit (MNIL). This can be thought of as a deductible. In 2024, the MNIL is $525 / month for single applicants, as well as married couples. Program participants have the option of making a cash payment to the state to meet their “Spend-Down” rather than meeting it by paying medical bills. Once the Spend-Down has been met, one is income-eligible for Medicaid services for the remainder of the month. The asset limit for this program is $2,000 for an individual and $3,000 for a couple.

2) Asset Spend Down – Seniors who have assets over MT Medicaid’s limit can “spend down” assets and become asset-eligible. This can be done by spending excess assets on non-countable ones, such as home modifications (i.e., wheelchair ramps or stair lifts), prepaying funeral and burial expenses, and paying off debt. Remember that assets cannot be gifted or sold for less than fair market value. Doing so violates MT Medicaid’s “Look-Back” Period of 5 years. 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 not only become Medicaid eligible, but also to protect their home from Medicaid’s Estate Recovery Program. Connect with a Medicaid Planner.

Specific Montana Medicaid Programs

In addition to paying for nursing home care, Montana Medicaid offers the following long-term care programs relevant to the elderly that help them to live at home, in adult foster care homes, or in assisted living residences.

1) HCBS Waiver – Also called Montana’s Big Sky Waiver (BSW), benefits are provided for persons with physical disabilities and seniors who require a Nursing Home Level of Care, but choose to live at home or in the community. This includes assisted living facilities and adult foster care homes. Services and supports include private duty nursing, home modifications, specialized medical equipment, and adult day health care. Personal care assistance is also available and program participants are able to select the caregiver of their choosing.

2) Self-Directed Personal Assistance Services (PAS) – Also called Montana Community First Choice (CFC), in-home assistance with daily living activities is provided for persons who are elderly or disabled. This may include assistance with bathing, toileting, mobility, preparing meals, laundry, and grocery shopping. There is a self-directed option that allows eligible individuals to hire and train their own caregivers.

3) Money Follows the Person (MFP) – This federal program helps institutionalized persons who are eligible for Medicaid to transition back home or into the community.

How to Apply for Montana Medicaid

Montana seniors can fill out an application for Medicaid benefits at apply.mt.gov. To learn more about Montana’s Medicaid programs or for assistance with the application process, call 406-444-4077 to reach the Department of Public Health and Human Services (DPHHS) Senior and Long Term Care Division. Persons can also contact their local Field Office of Public Assistance for assistance. Alternatively, persons can call the Montana Public Assistance Helpline at 888-706-1535. The application process may vary based on the program for which one is applying.

Prior to applying for Montana Medicaid, it is extremely important that applicants are certain that they meet all of the eligibility requirements that are covered on this page. If the criteria is not met, or if one is unsure, Medicaid Planning may mean the difference between approval and denial of benefits. Furthermore, the Medicaid application process can be complicated, confusing, and time consuming. Familiarizing oneself with general information about the application process for long-term care Medicaid can be helpful.