Qualifying for Medicaid Without Losing Everything

At Crane Law, PC, we frequently meet with families who are overwhelmed by the cost of long-term care. A loved one has been admitted to a nursing home, the private pay rate is staggering, and they’re told that Medicaid is an option — but only after they spend nearly all of their assets. Understandably, they’re scared, frustrated, and unsure where to turn.

The good news is that you don’t have to lose everything to qualify for Medicaid. With thoughtful planning — even in a crisis — you can preserve assets, protect your spouse, and secure the care you need. Here's how.

1. Understand the Basics of Medicaid Eligibility

Medicaid is a needs-based program that helps pay for long-term care. To qualify, an applicant must meet strict income and asset limits, which vary based on whether the applicant is single or married. In Pennsylvania, the asset limit for a single individual is typically $2,400, and slightly higher if income is under a certain threshold. For married couples, the non-applicant spouse may keep a portion of the couple’s resources — often called the Community Spouse Resource Allowance (CSRA).

But here’s what many people don’t realize: not all assets are counted, and many common strategies can be used to spend down or reposition assets in ways that comply with Medicaid rules.

2. Identify Countable and Non-Countable Assets

Before taking any action, it’s important to understand what assets count toward Medicaid’s limit.

✅ Typically exempt assets include:

• A primary residence (if the applicant or spouse lives there)

• One vehicle

• Irrevocable burial reserves

• Certain life insurance policies

  
  

❌ Countable assets may include:

• Checking and savings accounts

• Investment accounts

• Cash value in life insurance policies (depending on the face amount)

• Retirement accounts (in some cases)

  
  

A qualified attorney can help identify which assets are countable and which are not, and what strategies are available to protect them.

3. Don’t Give Assets Away Without a Plan

Gifting assets to children or transferring the house without guidance may seem like a solution, but these gifts can trigger a Medicaid penalty period — delaying eligibility and causing unexpected costs.

Medicaid has a five-year look-back period, meaning the Department of Human Services will examine any transfers made for less than fair market value during the 60 months prior to your application. Improper transfers can result in months (or even years) of ineligibility.

That’s why it’s so important to consult with a Medicaid planning attorney before making any transfers.

4. Use Strategic Spend-Down and Repositioning Options

The law allows certain expenses and strategies to reduce countable assets without violating Medicaid’s rules. These may include:

• Paying off debts or prepaying for funeral arrangements

• Making exempt home repairs

• Purchasing a Medicaid Compliant Annuity

• Funding irrevocable burial reserves

• Paying legal fees for Medicaid planning and application support

  
  

Each family’s plan will look different, depending on their goals, resources, and timeline.

5. Protect the Community Spouse

Medicaid rules are designed to avoid impoverishing the healthy spouse. If one spouse needs care, the other may still retain a significant portion of the couple’s assets — and may even receive some or all of the applicant spouse’s income through a Spousal Allowance if their own income is low.

With proper legal guidance, a spouse can often remain in the home, keep a vehicle, maintain a reasonable standard of living, and avoid financial ruin — even while their partner receives full Medicaid benefits in a nursing home.

6. Work with a Certified Medicaid Planner and Attorney

Medicaid rules are complex, constantly evolving, and filled with exceptions and opportunities. At Crane Law, PC, we help families navigate these challenges with compassion, precision, and a plan tailored to their unique circumstances.

Whether you’re facing an immediate nursing home admission or you’re planning ahead for the future, our Medicaid planning services can help you:

• Protect assets you’ve worked a lifetime to build

• Accelerate Medicaid eligibility

• Create peace of mind for you and your loved ones

Let’s Tell Your Story — And Protect It

Your life savings shouldn’t be lost to nursing home bills. At Crane Law, PC, we believe in preserving the legacy you’ve worked so hard to build.

Schedule a consultation today and let’s begin building a plan that protects what matters most.