The Centers for Medicare & Medicaid Services (CMS) has officially updated the financial benchmarks for 2026, and the shift is significant. For families navigating the high costs of long-term care, these new thresholds determine who qualifies for state assistance and who is forced to “private pay” thousands of dollars out of pocket.

If you are currently evaluating nursing home Medicaid qualifications, staying under these caps is no longer just about spending money—it’s about strategic preservation. Here is the 2026 breakdown of the new Medicaid income cap and asset limits.

The $2,982 “Hard” Income Cap

In many “Income Cap” states (such as Florida, Texas, and New Jersey), there is a strict limit on how much gross monthly income an applicant can receive.

  • The 2026 Limit: The individual income limit has risen to $2,982 per month (up from $2,901 in 2025).

  • The “Miller Trust” Solution: If your Social Security and pension combined total even $1 over this $2,982 limit, you are technically ineligible for Medicaid. However, you can use a Qualified Income Trust (QIT), or Miller Trust, to “redirect” the excess income and regain eligibility.

2026 Asset Limits: The $2,000 Standard

While income limits rose with inflation, the basic asset limit for a single individual remains stuck at $2,000 in the majority of states.

  • The Exceptions: A few states have broken away from this “poverty-level” requirement. In 2026, California allows an individual to keep $130,000, New York allows $33,038, and Illinois allows $17,500.

  • Countable vs. Exempt: Remember, your primary home (up to an equity limit of $752,000 to $1,130,000 in 2026), one car, and personal belongings generally do not count toward that $2,000 limit.

Protecting the “Community Spouse”

One of the most important aspects of 2026 Medicaid eligibility limits is the protection of the spouse still living at home (the “Community Spouse”). The 2026 Spousal Impoverishment Standards have seen a healthy increase:

  • Maximum Community Spouse Resource Allowance (CSRA): The healthy spouse can now keep up to $162,660 in countable assets.

  • Monthly Maintenance Needs Allowance (MMMNA): If the healthy spouse has low income, they can keep up to $4,066.50 of the couple’s combined monthly income to pay for their own living expenses.

What These Numbers Mean for Your “Spend-Down”

If you are over the limits, you must engage in a “spend-down.” In 2026, this doesn’t mean you have to go broke. It means you must convert “countable” assets (like cash in a savings account) into “non-countable” assets.

  • 2026 Strategy: Many families are using the 2026 limit increases to justify larger home improvements or the purchase of a newer, more reliable vehicle—both of which are “exempt” transfers that do not trigger the 5-year look-back penalty.

 

The 2026 Medicaid limits provide a small amount of breathing room for income, but the asset tests remain a formidable barrier for most American seniors. Knowing that you can have $2,982 in monthly income is helpful, but knowing how to protect $162,660 for your spouse is life-changing. Don’t let these numbers catch you off guard. Contact Lforlaw today to connect with expert Medicaid planning attorneys who can help you navigate these 2026 thresholds and ensure you qualify for care without sacrificing your family’s financial future.

Sources

  • CMS Informational Bulletin (Dec 2025): 2026 SSI and Spousal Impoverishment Standards.

  • Medicaid.gov: Federal Financial Eligibility Standards for Long-Term Services and Supports.

  • American Council on Aging: 2026 State-by-State Medicaid Income and Asset Limit Table.

  • Department of Health and Human Services (HHS): Annual Update to the Federal Poverty Level and Medicaid Caps.

Receive the latest news in your email
Recent Post