What Happens to the Healthy Spouse When Their Spouse Enters a Nursing Home?

When a married person requires long-term care and enters a nursing home, their spouse often faces more than just emotional upheaval. Financial uncertainty and legal confusion can quickly follow—especially when the couple must navigate Medicaid eligibility.

Fortunately, Medicaid includes specific protections for the spouse who remains at home, commonly called the “community spouse.” These provisions are designed to prevent financial ruin and allow the healthy spouse to maintain a basic standard of living. Let’s explore what you need to know. 

Read more: How to Save on Nursing Home Costs

Medicaid Eligibility and the “Community Spouse” Rule

To qualify for long-term care Medicaid, an individual must meet strict asset and income limits. However, these rules are slightly different when the applicant is married. Under the Spousal Impoverishment Protection rules, the spouse who remains at home is allowed to keep a portion of the couple’s assets and income. This ensures the healthy spouse isn’t left destitute while their partner receives care in a facility.

What Is the Community Spouse Resource Allowance?

The Community Spouse Resource Allowance (CSRA) allows the healthy spouse to retain a certain amount of the couple’s countable assets. In 2025, this amount can be as high as $154,140, though it varies by state. Countable assets typically include:

• Cash and savings
  
• Retirement accounts
  
• Investments
  
• Additional real estate
  

Non-countable (or exempt) assets—such as the primary residence, one vehicle, and personal belongings—do not count toward this limit and may be retained in full.

What Happens to Income?

In most cases, Medicaid will require the institutionalized spouse to contribute their income toward the cost of care. However, if the healthy spouse’s own income is below a certain threshold, they may be entitled to a portion of the Medicaid recipient’s income under the Monthly Maintenance Needs Allowance (MMNA). Some states apply a standard threshold, while other states use a minimum and maximum allowance, where the healthy spouse’s MMNA varies depending on their monthly living expenses.

Will the Healthy Spouse Lose Their Home?

One of the most common fears among families is that the spouse remaining at home will lose the house. Thankfully, in most cases, the primary residence is considered an exempt asset—as long as the community spouse continues to live there. This means the house does not count against Medicaid eligibility and cannot be taken while the healthy spouse is living. However, families should still plan ahead for potential estate recovery after the couple passes.

Read more: Who Needs a Funeral Plan?

Tools to Protect Assets for the Community Spouse

If you’re worried about protecting additional savings or investments, there are planning strategies designed specifically for individuals and married couples seeking Medicaid eligibility:

Medicaid Compliant Annuities (MCAs)

An MCA allows excess countable assets to be converted into an income stream for the community spouse, helping preserve their financial stability while ensuring the applicant meets Medicaid’s asset requirements.

Spousal Transfers

Assets can typically be transferred between spouses without penalty. This means the ill spouse can transfer some of their assets to the community spouse, who can retain a larger share of the couple’s resources without affecting eligibility.

Legal Guidance

Because Medicaid eligibility rules are complex and state-specific, it’s critical to work with a qualified professional. An elder law attorney or Medicaid planner can help structure your finances and ensure the community spouse’s needs are protected. 

Take the Next Step

Navigating Medicaid as a married couple can be complicated, but the healthy spouse is not left out in the cold. Medicaid offers essential protections that, with the right guidance, can help preserve assets and peace of mind. Tell us about your situation, and we’ll help you understand the best options for your family.