Medicaid is a health care program for low-income individuals of all ages. While there are many different Medicaid coverage groups, this page focuses on long-term care Medicaid eligibility for elderly Tennessee residents, aged 65 and over. 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. There are three categories of Medicaid long-term care programs for which TN seniors may be eligible.
1) Institutional / Nursing Home Medicaid – An entitlement; anyone who is eligible will receive assistance. Benefits are provided only in nursing homes.
2) Medicaid Waivers / Home and Community Based Services (HCBS) – Not an entitlement; the number of participants is limited and waiting 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 on Waivers.
3) Regular Medicaid / Aged, Blind, and Disabled – An entitlement; 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.
Tennessee’s Medicaid program, also called TennCare, is a Managed Care Program. The division that provides long-term care assistance for the elderly is called Long-Term Services & Supports. While TennCare is jointly funded by the state and federal government, it is administered by the state within federally set parameters. The Division of TennCare is the administering agency.
The American Council on Aging now offers a free, quick and easy Medicaid Eligibility Test for seniors.
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 since Tennessee offers alternative pathways towards eligibility.
Simplified Eligibility Criteria: Single Nursing Home Applicant
Tennessee seniors must have limited income and assets, and a medical need to qualify for Medicaid long-term care. In 2024, a single Nursing Home Medicaid applicant must meet the following criteria: 1) Income under $2,829 / month 2) Assets under $2,000 3) Require a Nursing Home Level of Care.
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 Test. IMPORTANT: Not meeting all of the criteria does not mean one is automatically ineligible for TennCare or cannot become eligible. More.
| 2024 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 | $2,829 / month* | $2,000 | Nursing Home | $5,658 / month ($2,829 / month per spouse)* | $4,000 ($2,000 per spouse) | Nursing Home | $2,829 / month for applicant* | $2,000 for applicant & $154,140 for non-applicant | Nursing Home |
| Medicaid Waivers / Home and Community Based Services | $2,829 / month† | $2,000 | Nursing Home or “At Risk” | $5,658 / month ($2,829 / month per spouse)† | $4,000 ($2,000 per spouse) | Nursing Home or “At Risk” | $2,829 / month for applicant† | $2,000 for applicant & $154,140 for non-applicant | Nursing Home or “At Risk” |
| Regular Medicaid / Aged, Blind, and Disabled | $943 / month | $2,000 | Help with ADLs | $1,415 / month | $3,000 | Help with ADLs | $1,415 / month | $3,000 | Help with ADLs |
*All of a beneficiary’s monthly income with the exception of a Personal Needs Allowance of $50 / month, Medicare premiums, and possibly a Needs Allowance for a non-applicant spouse, must go towards nursing home costs. This is called a Patient Liability.
†Based on one’s living setting, a program beneficiary may not be able keep monthly income up to this level.
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, IRA withdrawals, and stock dividends. Nationally, Holocaust restitution payments are not counted as income. Furthermore, in TN, 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 applicant’s income eligibility. Furthermore, 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.
In TN, the MMMNA is $2,555 (eff. 7/1/24 – 6/30/25). If a non-applicant’s income falls under $2,555 / month, income can be transferred to them from their applicant spouse, bringing their total monthly income up to $2,555. A non-applicant spouse can further increase their Spousal Income Allowance if their housing and utility costs exceed a “shelter standard” of $766.50 / month (eff. 7/1/24 – 6/30/25). However, in 2024, a Spousal Income Allowance cannot push a non-applicant’s total income over $3,853.50 / month. This is the Maximum Monthly Maintenance Needs Allowance. More on how this allowance is calculated.
Income is counted differently when only one spouse applies for Regular Medicaid; the income of both the applicant and non-applicant spouse is counted towards the applicant’s income eligibility. Additionally, there is no Monthly Maintenance Needs Allowance for the non-applicant spouse. More on how Medicaid counts income.
Countable vs. Non-Countable Assets
Countable assets include cash, stocks, bonds, investments, bank accounts (credit union, savings, and checking), and real estate in which one does not reside. In Tennessee, IRA’s / 401K’s are counted. There are also assets that Medicaid does not count towards the asset limit. Exemptions include personal belongings, household furnishings, an automobile, irrevocable burial trusts, and generally one’s primary home.
Treatment of Assets for a Couple
All assets of a married couple are considered jointly owned. This is true regardless of the long-term care Medicaid program for which one is applying and regardless of if one or both spouses are applicants. There is, however, a Community Spouse Resource Allowance (CSRA) that protects a larger portion of the couple’s assets for the non-applicant spouse of a Nursing Home Medicaid or Medicaid Waiver applicant. In 2024, the non-applicant spouse (community spouse) can retain 50% of the couple’s assets, up to a maximum of $154,140. If the community spouse’s share of the assets is under $30,828, 100% of the assets, up to $30,828can be retained by that spouse.
Medicaid’s Look-Back Rule
Tennessee has a 60 month (5-year) Medicaid Look-Back Period that immediately precedes one’s date of Nursing Home Medicaid or Medicaid Waiver application. During this period, Medicaid checks to ensure no assets were gifted or sold for less than fair market value. This includes asset transfers made by one’s spouse. If the Look-Back Rule has been violated, Medicaid assumes it was done to meet the asset limit. Persons who violate this rule are penalized with a period of Medicaid ineligibility.
The U.S. Federal Gift Tax Rule does not extend to Medicaid eligibility. This rule, in 2024, allows individuals to gift up to $18,000 per recipient without filing a Gift Tax Return. Gifting under this rule violates Medicaid’s Look-Back Period.
For the home to be exempt, a 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. There is no home equity interest limit for Regular Medicaid. 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, 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.
An applicant must have a medical need for long-term care Medicaid. 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.
Elderly Tennessee residents (aged 65 and over) who do not meet the financial eligibility requirements above may still be able to qualify for long-term care Medicaid.
1) Qualified Income Trusts (QIT’s) – Also called Miller Trusts, QITs allow persons over Medicaid’s income limit to still become income-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 asset-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” and / or “over-asset”, but they 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. Connect with a Medicaid Planner.
In addition to paying for nursing home care, TN Medicaid offers the following programs relevant to the elderly that helps them to live independently in their homes or communities.
1) CHOICES in Long-Term Services and Supports Program – Intended to help nursing home qualified individuals or those “at risk” of requiring this level of care, to live 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.
Seniors can apply for TennCare online at TennCare Connect, by calling TennCare Connect at 855-259-0701, or by submitting a completed paper application (halfway down 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 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 financial eligibility criteria, should seriously consider Medicaid planning for the best chance of acceptance into a Medicaid program. Familiarizing oneself with general information about the application process for long-term care Medicaid can be helpful.