Medicaid Asset Limits for Married Couples (2026): Spousal Impoverishment Rules Explained
When both spouses apply for Medicaid as seniors or people with disabilities, the standard asset limit is $3,000 for the couple in most states. When only one spouse needs nursing home or in-home care, federal spousal impoverishment rules let the other spouse keep far more: up to $157,920 in 2025, plus the house, a car and a monthly income allowance. Which rule applies depends entirely on who is applying and for what.
First question: which Medicaid group are you in?
Asset limits only apply to the non-MAGI groups: people 65 and older, blind or disabled, and anyone applying for long-term care. Married adults under 65 applying in an expansion state, parents, pregnant women and children are assessed on income alone. A couple in their 40s with $80,000 in savings and low income can qualify in an expansion state; the same couple at 70 cannot.
Both spouses apply: the couple limit
Most states set the limit at $2,000 for an individual and $3,000 for a couple, unchanged since 1989. A handful are different:
- No asset test at all: California (since 2024) and Arizona for most aged and disabled groups.
- Higher limits: New York $32,396 individual / $43,781 couple; Minnesota $3,000 / $6,000; Connecticut $1,600 / $2,400 (lower); Illinois $17,500 per person; New Hampshire $2,500 / $4,000; North Dakota $3,000 / $6,000.
- Missouri has been raising its limit yearly and is above $6,000 per person.
Your state's current figure is on the asset limits page under Medicaid by state. Confirm it with the agency; these change more often than income percentages.
One spouse applies for long-term care: spousal impoverishment rules
Congress wrote these rules in 1988 so that a healthy spouse is not left destitute when the other enters a nursing home. They apply to institutional Medicaid and, in every state, to HCBS waiver programs that pay for care at home or in assisted living.
The snapshot date
The state totals all countable assets owned by either spouse, jointly or separately, as of the date the applicant first entered a hospital or nursing facility for a stay of 30 days or more. Prenuptial agreements and whose name is on the account do not matter; everything is pooled.
Community Spouse Resource Allowance (CSRA)
From that total, the spouse at home, the "community spouse," keeps a protected amount:
| Rule | 2025 figure | States using it |
|---|---|---|
| Federal maximum | $157,920 | About half of states let the community spouse keep up to this amount regardless of total assets (e.g. California, Florida, Georgia, Illinois, New York, Texas) |
| Federal minimum | $31,584 | Floor every state must allow |
| One-half rule | 50% of the couple's total, between the minimum and maximum | The other half of states (e.g. Ohio, Pennsylvania, Michigan, Indiana, Arizona) |
Example in a one-half state: a couple with $200,000 countable. The community spouse keeps $100,000; the applicant must spend down the remaining $100,000 to the $2,000 individual limit before Medicaid pays. In a maximum state the community spouse keeps $157,920 and only $42,080 must be spent down. The figures adjust for inflation every January.
Monthly income allowance (MMMNA)
Income is not pooled the way assets are; each spouse's own income is theirs. But if the community spouse's income is below a state minimum, between $2,643.75 and $3,948 per month in 2025, a portion of the nursing home spouse's income is diverted to them before the rest goes to the facility. A community spouse with only $900 in Social Security can receive more than $1,700 a month from the applicant's pension this way.
What counts and what is exempt
| Counted | Exempt |
|---|---|
| Checking, savings, CDs, cash | The home, if a spouse lives there (no equity cap applies when a spouse is in residence) |
| Stocks, bonds, mutual funds, brokerage accounts | One vehicle of any value |
| Retirement accounts of the applicant in most states; the community spouse's IRA/401k is exempt in many states but counted in others | Household goods, personal effects, wedding rings |
| Second homes, land, rental property | Irrevocable prepaid funeral contracts and burial plots for both spouses |
| Cash value of whole life insurance over $1,500 face value | Term life insurance |
| Property held jointly with children, to the extent of the applicant's share | Assets in a properly drafted special needs trust or Medicaid-compliant annuity |
The retirement account row is where couples most often get surprised. Florida, Illinois, Texas and several others exempt the community spouse's IRA if it is in payout status; New York, Ohio and Pennsylvania count it. Ask before assuming.
Legal ways a couple can reduce countable assets
None of these is a transfer for less than value, so none triggers the 60-month look-back penalty:
- Pay down the mortgage or make home repairs. Moves cash into the exempt home.
- Buy a newer car for the community spouse.
- Prepay funerals for both spouses through irrevocable contracts.
- Medicaid-compliant annuity. The community spouse converts excess assets into an income stream for themselves; the asset disappears, the income stays below the counting rules. This is the most powerful tool and needs an attorney who does it regularly.
- Pay off debt: credit cards, car loans, medical bills.
- Caregiver agreement. A written contract paying a child for care at market rates, prospectively, not retroactively.
What does not work: moving money into the healthy spouse's name alone (still pooled), gifting to children (penalty), or "spousal refusal," which is allowed only in New York and a few other states and invites a lawsuit from the state.
Frequently asked questions
Does my spouse's money count if we keep separate accounts?
Yes. For long-term care, every countable asset of either spouse is pooled on the snapshot date, regardless of title.
Can the healthy spouse keep the house?
Yes. The home is exempt as long as the community spouse lives in it, with no equity limit. Estate recovery is also deferred until that spouse dies.
What if we divorce?
Some couples consider a "Medicaid divorce" to split assets, but a court usually divides property equally, which often leaves the applicant with more than spousal impoverishment rules would. It is rarely better and has tax and emotional costs.
Do the rules apply to assisted living?
Only if the assisted living is paid through an HCBS waiver. Private-pay assisted living is not Medicaid, and the spousal rules do not apply.
What to do next
- List every account and asset in either name with current balances; note the date of any hospital or nursing home admission.
- Check your state's asset limits and whether it uses the one-half or maximum CSRA rule on the seniors page under Medicaid by state.
- Separate exempt from countable assets using the table above.
- If countable assets exceed the CSRA plus $2,000, talk to an elder law attorney about an annuity or other spend-down before applying; the order of operations matters.
- Read the look-back period guide before moving any money.