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Medicaid 101: Financial Eligibility

Introduction – Medicaid Financial Eligibility

In my last post, I discussed the basics of Medicaid (click here). To recap, Medicaid is a joint effort between the states and federal government. It pays the medical expenses of qualified individuals. I am an estate planning and elder law attorney. My law firm helps clients plan for long-term care in nursing homes. The Medicaid long-term care program has strict financial requirements. What are these requirements, and are there any exceptions? That’s the subject of today’s post.

Medicaid Asset Limits

In order to qualify for Medicaid, individuals must have less than $2,000.00 in countable assets. What is a countable asset? Generally, Medicaid considers all of the property a person owns. This means everything from real estate to stocks and bonds to life insurance. However, there are several exceptions. The following are some of the exemptions when determining the applicant’s eligibility:

  • Primary residence (up to $572,000.00)
  • One vehicle (of any value)
  • Life insurance with no cash value
  • Burial plots and irrevocable burial policies

The above list is not exhaustive. Whether an asset is exempt can turn on several factors. Thus, it is important to consult with a qualified elder law attorney about your particular situation.

Medicaid Income Limits

In addition to assets, the Oklahoma Health Care Authority (which administers Medicaid) looks at the applicant’s income. Oklahoma is an income cap state, meaning there is an upper limit on how much income you can have. This figure changes based on the cost of living. For 2018, the Oklahoma income cap is $2,250 per month. Nevertheless, a person may be able to keep more of their income by establishing a Medicaid Income Pension Trust. I will cover Medicaid Income Pension Trusts in an upcoming post.

Conclusion – Find the Right Elder Law Attorney

As we have seen, Medicaid is a complicated program. And qualifying for benefits is not easy, as a person must have minimal assets and income. Unfortunately, the price of nursing homes continues to rise. Too often, this leaves folks feeling like they are between a rock and a hard place: either divest all of their assets or potentially go without critical care. Luckily, elder law attorneys like myself have several strategies to preserve assets in the face of long-term care. My next series of posts will provide an overview of those strategies. Until then, visit the Oklahoma Health Care Authority’s website for more information on our state’s Medicaid program: