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In Brief: Medicaid Financial Eligibility Rules Can Affect Access to Home Care

Medicaid is the largest source of payment for long-term care in the United States today. Although most older people who need help with daily activities prefer to receive care at home, Medicaid continues to have an institutional bias. A new study by AARP's Public Policy Institute focuses on the impact that Medicaid's financial eligibility rules have on access to home care services for older people with disabilities. The report, entitled Medicaid Financial Eligibility for Older People: State Variations in Access to Home and Community-Based Waiver and Nursing Home Services* was authored by Enid Kassner of the Public Policy Institute and Lee Shirley of the National Academy on an Aging Society.

In brief, the report found that while many states use the same financial eligibility criteria for participants in nursing homes and home and community-based (HCBS) "waiver" programs, numerous states use more restrictive criteria for gaining waiver eligibility, than for nursing home eligibility.


  • thirteen states are more restrictive in the income eligibility criteria applied to waiver participants compared to their treatment of nursing home residents;
  • a substantial number of states (19) fail to offer the spouses of waiver recipients the full level of income and/or asset protection afforded the spouses of nursing home residents; and
  • there is great variation in the amount of income that state Medicaid waiver programs permit older people to keep for maintaining themselves in their homes. At the time of the survey, the states' "maintenance needs allowances" ranged from $242 per month to $1,482 per month (300 percent of SSI in 1998). Twenty-one states allowed waiver participants to retain $600 per month or less in income.

    The report recommends that states:

  • allow HCBS waiver beneficiaries and their spouses to retain the same level of assets that nursing home residents may keep;
  • conduct careful reviews of their maintenance needs allowances for waiver beneficiaries to ensure a reasonable likelihood that beneficiaries can afford to remain in the community; and
  • allow the spouses of HCBS waiver beneficiaries to retain the same level of income as they allow the spouses of nursing home residents.


* AARP Public Policy Institute Issue Paper # 2000-06 (April 2000)

Written by Enid Kassner, AARP Public Policy Institute
July 2000
©2000 AARP
May be copied only for noncommercial purposes and with attribution; permission required for all other purposes.
Public Policy Institute, Public Affairs, AARP, 601 E Street, NW, Washington, DC 20049

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