Medicaid and Planning for Long-Term Care in New York

Not for long-term care. Medicare covers a short stay in a skilled nursing facility for recovery after a hospital stay, but it does not pay for ongoing custodial care.

Custodial care means help with everyday tasks like bathing, dressing, and eating. This is the kind of care most long-term nursing home residents need. Medicare and most health insurance, including Medigap supplement plans, do not pay for long-term care, whether in a nursing home or at home. Medicare does cover skilled care, such as rehab after a fall or surgery, for up to 100 days per benefit period. In 2026, you pay $217 per day for days 21 through 100. After day 100, you pay the full cost. Coverage can also end sooner if you stop improving. For most New York families, Medicaid is the program that pays for long-term nursing home care. 

Knowing this before a hospital discharge gives your family time to plan instead of react.

Source: Medicare.gov, Long-Term Care; CMS, 2026 Medicare Parts A and B Premiums and Deductibles.

No. Medicare does not pay for an aide who helps with daily tasks on an ongoing basis. In New York, Medicaid is the main public program that pays for long-term care at home.

Many families assume a parent’s Medicare will cover an aide once the parent cannot safely live alone. It will not. Medicare’s own guidance tells people to contact their state Medicaid office to find out if they qualify for long-term care coverage. In New York, Medicaid pays for home care through programs such as Managed Long Term Care (a Medicaid health plan that arranges care at home). Each program has its own income, asset, and medical rules, which we explain below. Private long-term care insurance can also pay for an aide, but only if the policy was bought earlier.

If a parent is starting to need help, learning the Medicaid rules now gives you more choices later.

In 2026, New York State uses $15,282 per month as the average private-pay cost of a nursing home in New York City. That is about $183,000 per year.

The New York State Department of Health publishes this figure every year. The 2026 rate for New York City is $15,282 per month, based on average private-pay nursing home costs in each region. The state uses this number to calculate Medicaid penalties, which we explain later. It also gives families a realistic picture of what care costs. Individual nursing homes charge more or less than this average. 

Illustration: Rose, age 84, lives in Queens. She needs nursing home care for three years and pays privately. At the 2026 average, three years costs about $550,000.

Seeing the real number early helps families weigh their options calmly.

Medicare is health insurance for people 65 and older, regardless of income. Medicaid is a needs-based program, and it is the main program that pays for long-term care.

Medicare covers doctors, hospitals, and short-term rehab. You qualify mainly by age or disability. Your savings do not matter. Medicaid is run jointly by the federal government and New York State. To qualify, you must meet strict income and asset limits, and for long-term care, a medical need test. Many older New Yorkers have both programs at the same time. Medicare pays first for medical care. Medicaid then covers long-term care that Medicare does not.

Knowing which program pays for what helps you see where the real gaps are.

In 2026, a single person can have up to $1,836 per month in income for Medicaid home care. A married couple can have up to $2,489 per month.

These 2026 limits come from the state’s income and resource chart: $1,836 per month for one person and $2,489 per month for two. Income includes Social Security, pensions, and regular payments from retirement accounts. Going over the limit does not automatically disqualify you. You may still qualify by spending the extra on medical bills or by using a pooled trust, both explained below. Nursing home Medicaid works differently. Most of the resident’s income goes toward the cost of care. The resident keeps a personal allowance of $50 per month. 

Illustration: Frank lives in Brooklyn and receives $1,700 per month from Social Security. In 2026, he is under the $1,836 limit for home care.

These numbers change every January, so we check the current figures with each family.

In 2026, a single person can have up to $33,038 in countable assets. A married couple applying together can have up to $44,796.

Countable assets include bank accounts, brokerage accounts, and most investments. For 2026, the state’s resource limit is $33,038 for one person and $44,796 for two. The same limit applies to home care and nursing home Medicaid. Some assets do not count, such as the home within certain limits. Those are covered in the next answers. If only one spouse needs care, the healthy spouse can keep much more. See the section on married couples. 

Illustration: Maria, age 80, has $90,000 in savings. She is about $57,000 over the 2026 limit for a single person.

A review of what counts and what does not is often the first step in a plan.

Some assets do not count toward the limit. These include the home (within an equity limit), retirement accounts that are paying out on a regular schedule, and money held in a qualifying pooled trust.

“Not counted” means Medicaid ignores the asset when it decides if you qualify. The home is usually not counted if its equity is within the state limit, explained below. A retirement account that is not paying out counts as an asset, valued at what you could withdraw today. Once it pays out on a schedule, the account balance is not counted, but the payments count as income. The money in a pooled trust account is not counted when Medicaid decides eligibility. Other rules apply to specific assets. A lawyer should review your full list, since one mistake can delay an application for months. 

A careful inventory now prevents surprises when you apply.

It depends on whether the account is paying out. If you receive regular scheduled payments, the account balance is not counted, but the payments count as monthly income. If not, the balance counts as an asset.

This applies to IRAs, 401(k) plans, and similar accounts. If you are not receiving periodic payments but can withdraw the money, the account is a countable asset. Its value is what you could withdraw now, after any early withdrawal penalty. Income taxes owed are not subtracted. Once you receive or apply for periodic payments, the principal is not counted. Married couples face a different rule for nursing home care. If the healthy spouse is not taking periodic payments from their own retirement account, the account counts when deciding the other spouse’s eligibility. 

Illustration: Joe, age 78, has a $200,000 IRA and takes regular monthly payments. The $200,000 is not counted as an asset. The monthly payments count as income.

Setting up payments the right way, at the right time, can protect savings that took a lifetime to build.

Often, yes. In 2026, a home is generally not counted if the owner’s equity is $1,130,000 or less. The equity limit does not apply if a spouse, a child under 21, or a blind or disabled child lives there.

Equity is the home’s value minus any mortgage. For 2026, the home equity limit for Medicaid coverage of nursing home care and home care is $1,130,000. Under federal law, the limit does not apply when a spouse, a child under 21, or a blind or disabled child lives in the home (42 U.S.C. § 1396p(f)). Keeping the house during your lifetime is a separate question from what happens to it after death. That is covered under estate recovery below. The rules for a home during a nursing home stay can depend on who lives there and other facts. 

Illustration: Ana owns a Bronx home worth $700,000 with no mortgage. Her equity is below the 2026 limit.

Many families protect the home through planning done years before care is needed..

Since September 1, 2025, new applicants generally must need hands-on help with three or more daily activities. Someone with a dementia or Alzheimer’s diagnosis must need at least supervision with two or more.

Daily activities include tasks like bathing, dressing, eating, using the toilet, and moving from a bed to a chair. The state’s rule requires at least limited assistance with physical movement for more than two activities of daily living, or, for people with dementia or Alzheimer’s, at least supervision with more than one. For Managed Long Term Care, the person must also be assessed as needing community-based long-term care for more than 120 days. An independent nurse assessor scores these needs. Meeting the financial rules is not enough. You must meet the care rules too. 

Keeping good records of a parent’s daily needs makes the assessment more accurate..

You may still qualify. New York lets you “spend down” the extra income on medical costs each month, or place it in a pooled trust so it does not count.

The amount over the limit is called excess income or a spend-down. Here is how it works. In 2026, the limit for one person receiving home care is $1,836 per month. If your countable income is higher, you must use the difference each month on medical bills, or pay it to Medicaid, before Medicaid pays. For many people, that leaves too little to pay rent and food. A pooled trust solves this for many families. See the next question.

Illustration: Helen, age 82, lives in Manhattan. Her income is $2,800 per month. Before any allowed deductions, about $964 is over the 2026 limit.

An income plan built before applying can keep a parent safely at home.

Source: NYS Department of Health, GIS 26 MA/03 and GIS 26 MA/05.

A pooled trust is a trust run by a nonprofit. A person with a disability deposits their excess income into it each month. The deposit does not count toward Medicaid’s income limit, and the trust uses the money to pay the person’s bills.

“Pooled” means the nonprofit manages many people’s accounts together but keeps a separate account for each person. The person must be certified as disabled, and the nonprofit must keep a separate account for each beneficiary. In New York, older adults who need home care can usually obtain this certification as part of the application. When the person lives at home, the income deposited into the trust does not count. The trust then pays bills such as rent and utilities. Pooled trusts work mainly for home care. If the person later enters a nursing home, the income deposited into the trust counts toward their monthly contribution to the cost of care. 

Illustration: Helen, from the example above, deposits her excess income into a pooled trust each month. The trust pays her rent, and she keeps her Medicaid home care.

A pooled trust is often what makes care at home affordable.

For nursing home Medicaid, New York looks back 60 months (five years) from the date of application. Gifts made during that time can delay coverage.

The look-back is a review of your finances before you apply. State law defines the look-back for nursing home care as the 60 months immediately before the person is both in a nursing home and has applied for Medicaid. Medicaid asks for bank statements and other records from that period. It looks for any transfer made for less than fair value, such as a gift to a child. A gift found in that window can lead to a penalty, which means a period when Medicaid will not pay. Normal spending on your own needs is not a problem. 

Illustration: Lou gave his son $50,000 in 2023. If Lou applies for nursing home Medicaid in 2026, that gift falls inside the 60-month window.

Planning more than five years ahead gives a family the most options.

A 30-month look-back for home care became law in 2020. As of October 2026, it has not started. No start date has been announced.

After a 2020 change in state law, New York sought federal approval for a 30-month look-back for people seeking long-term care at home. Under that law, the home care transfer rules reach back only to transfers made on or after October 1, 2020. The start of the look-back has been delayed several times. Elder law sources report that as of September 2026, the state still processes home care applications without a look-back. This could change on short notice. Gifts made today could be reviewed later if the rule takes effect.

Because this rule is in flux, we check its status before advising any family to move money.

Sometimes, but timing matters. Gifts made within five years before applying for nursing home Medicaid can cause a penalty. Gifts made more than five years before applying do not.

A gift is any transfer for less than full value. That includes cash, a house, or adding a child’s name to an account in some cases. For nursing home care, Medicaid reviews the full 60 months. For home care, there is currently no look-back in effect, as explained above. Gifting carries risks beyond Medicaid. Once money belongs to your child, it is exposed to your child’s divorce, debts, or poor decisions. Gifting also gives up control. Many families use an irrevocable trust instead, which we explain below.

Illustration: In 2026, Carol gives her daughter $100,000. If Carol needs a nursing home before 2031, Medicaid will count that gift.

Gifting should be part of a written plan, never a quick fix.

Medicaid divides the total value of the gifts by the state’s monthly regional rate. For New York City in 2026, that rate is $15,282.

The result is the number of months Medicaid will not pay for nursing home care. The state requires local offices to use the regional rate in effect on the date of application, for the region where the nursing home is located. The penalty does not start when the gift was made. Under federal law, it starts once the person is in a nursing home, has applied, and would otherwise qualify (42 U.S.C. § 1396p(c)(1)(D)). That means the family must pay privately during the penalty. 

Illustration: Carol gave $100,000 within the look-back. $100,000 divided by $15,282 equals about 6.5 months without Medicaid coverage.

Knowing the math ahead of time lets a family plan how to cover any penalty..

No. In 2026, the spouse at home can keep at least $74,820 of the couple’s countable assets, and up to $162,660, depending on the couple’s total savings.

The spouse who stays at home is called the “community spouse.” For 2026, the spouse at home can keep the greater of $74,820 or half of the couple’s countable assets, up to $162,660. The spouse in the nursing home can keep up to $33,038. These protections exist so the healthy spouse is not left without money. Other planning tools can protect more, including spousal refusal, explained below. 

Illustration: Sam and Lena have $300,000 in savings. Sam enters a nursing home in 2026. Lena can keep half, or $150,000.

Couples who plan early can usually protect much more than the minimum.

The spouse at home keeps all of their own income. In 2026, if that income is below $4,066.50 per month, the spouse may receive part of the other spouse’s income to make up the difference.

This $4,066.50 figure is the 2026 Minimum Monthly Maintenance Needs Allowance. It is the minimum monthly income the state protects for the spouse at home. The spouse in the nursing home can transfer some of their own income to the spouse at home, up to that amount. The rest of the nursing home spouse’s income generally goes toward the cost of care. 

Illustration: Lena’s own income is $1,500 per month. Up to $2,566.50 of Sam’s income can go to Lena each month in 2026.

This rule keeps the spouse at home from losing their home and way of life.

A spousal refusal is a signed statement in which the healthy spouse refuses to use their own income or assets for the ill spouse’s care. New York must still consider the ill spouse for Medicaid, but the state can later try to collect from the refusing spouse.

New York law allows this. Under Social Services Law § 366(3)(a), Medicaid must be provided to the spouse in the nursing home if the spouse at home fails or refuses to contribute their income. The refusal creates a legal obligation. The state can seek repayment from a refusing spouse for the amounts that spouse was required to contribute. In practice, the county may sue or negotiate a settlement. A refusal can still protect significant savings, but it carries real risk and must be handled carefully. 

Illustration: Lena has $400,000 in her own name, far above the allowance. She signs a refusal so Sam can get Medicaid. Lena should expect the state may seek some payment from her later.

Spousal refusal is a tool to weigh with a lawyer, not a form to sign alone.

It is an irrevocable trust (one that cannot be undone) that holds assets you will not be able to take back. If you fund it more than five years before applying for nursing home Medicaid, those assets are generally not counted.

You choose a trustee, often an adult child, to manage the trust. Federal law sets the key rule. If the trust could pay you principal under any circumstances, Medicaid counts that portion as your asset. Any portion that could never be paid to you is treated as a transfer, so the look-back applies. Many of these trusts let you keep receiving the income, which still counts toward Medicaid’s income limit. Because New York recovers only from the probate estate, assets held in a properly drafted trust generally fall outside estate recovery.

Illustration: In 2026, Paul, age 68, places his Staten Island home in a trust. If he needs a nursing home after 2031, the home is generally protected.

The trust works best when set up early, while you are healthy.

The best time is at least five years before nursing home care may be needed. Planning can still help after a crisis, but there are fewer options.

The five-year look-back for nursing home care is the main reason to start early. Gifts and trusts set up more than 60 months before an application are generally not counted. Early planning also lets you make choices while your parent can still sign documents. That includes a power of attorney and a health care proxy. If a parent loses capacity first, the family may need a court-appointed guardian, which takes time and money. Even in a crisis, steps such as a pooled trust or spousal protections can still make a real difference.

Illustration: Diane is 65 and healthy. A plan she signs in 2026 is generally outside the look-back by 2031.

Starting early is less about fear and more about keeping choices open.

It can, if the house passes through probate. New York seeks repayment from the probate estate of recipients who were 55 or older, but not while a spouse, a child under 21, or a blind or disabled child survives.

This is called estate recovery. New York must seek recovery from the estate of a Medicaid recipient who was 55 or older when they received benefits, or who was permanently in a nursing home, regardless of age. Recovery is barred during the life of a surviving spouse, or when there is a surviving child under 21 or a blind or disabled child. In New York, the “estate” means the probate estate. The state rule that expanded recovery to other assets expired on December 6, 2011. Assets that pass outside probate, such as through a properly drafted trust, are generally not reached. 

Illustration: Grace received Medicaid at age 85 and dies leaving her Bronx home to her son through her will. The home passes through probate, so Medicaid can file a claim.

How a home is titled today decides whether it can be reached later.

Usually not. Medicaid does not pay for living in a typical assisted living residence. It can pay for care through New York’s Assisted Living Program, which only some facilities offer.

Most assisted living is private pay. The state says Medicaid and Medicare will not pay for residing in an assisted living residence, though they may pay for certain services there, as in the state’s Assisted Living Program. The Assisted Living Program serves people who are medically eligible for a nursing home, in a less intensive and lower-cost setting. Medicaid recipients must have these services approved in advance by their local social services office. Families should confirm a facility participates before moving in.

Illustration: Mae needs nursing-home-level care but prefers a residential setting. Her family finds a Manhattan facility that participates in the Assisted Living Program and applies through the local office.

Checking program participation first can prevent a costly move.