If your spouse or parent needs care in assisted living or a nursing home, it’s possible you’ll need to apply for Medicaid to cover all or a part of this care cost. Assisted living in West Michigan typically ranges from $5,000 – $8,000 per month, while nursing home care ranges from $12,000 – $14,000 per month.
Each year, Medicaid updates certain numbers that are used to determine if someone is financially eligible for the program. These are the most important numbers for 2026:
1. Asset Eligibility Numbers. If you or your spouse applies for Medicaid, the rules have a maximum amount of assets you can keep as a couple. That number for 2026 is the lesser of one-half of your countable assets or $162,660. Let me illustrate how this is calculated. If you have $400,000 of countable assets (such as bank accounts, investments, annuities, etc.), the lesser of one-half of your assets (i.e. $200,000) or $162,660 is $162,660. In other words, you and your spouse will be maxed out at $162,660 in countable assets. On the other hand, if you and your spouse have $200,000 of countable assets, the lesser of one-half of that amount (i.e. $100,000) or $162,660 is $100,000. Because of this rule, you may only be able to keep half of your countable assets. On the positive side, if you have more than this amount of assets, it’s very likely planning can be done so you and your spouse can protect those excess assets. In other words, you won’t have to spend down those assets to qualify for Medicaid. Also, if you have a modest amount of assets, there’s also a minimum amount of assets that can be protected. In 2026, that number is $32,532. In other words, if you or your spouse have $32,532 in countable assets, you’re able to preserve all of these assets. You won’t have to spend down half of them to be eligible for Medicaid.
2. Income Eligibility Number. There’s a different Medicaid rule for income eligibility. This is important if your spouse or parent needs in-home care, is living in assisted living, or is interested in the PACE program. In 2026, the person who is applying for Medicaid cannot have income of more than $2,982 month. The most common types of income are: Social Security, pension, annuitized income, and rental income. Under the Medicaid rules, income doesn’t include distributions from an IRA. Also, the Medicaid rules don’t count the income of the healthy spouse. In other words, the rule just applies to the income of the person who needs Medicaid.
3. Divestment Number. If you or your parent makes gifts, transfers assets to another person, or adds someone as a joint owner on certain assets within five years of applying for Medicaid, a penalty will be assessed (which is known as “divestment”). This means that for a certain period of time, Medicaid won’t cover the cost of your spouse or parent’s care even though they are financially eligible. You or your parent will need to use your own assets or arrange for financial support from a family member. The penalty is calculated by taking the total amount of gifts or assets transferred within the last five years and dividing it by a certain number. In 2026, that number is $12,216.30. As an example, if you or your parent has divested $61,081.50, you’ll need to pay for five months of care beyond what Medicaid would otherwise cover. If you’re in a nursing home, this could be a very significant cost (i.e., $60,000 – $70,000). Finally, it is important to know that in some cases, there’s planning that is done to address this shortfall.
If you have any questions about Medicaid and the 2026 numbers, feel free to contact me at phmulder@cunninghamdalman.com.
