Summary
Seniors who need a significant amount of long-term care but want to remain living in their home or somewhere else in the community can get that care through Home and Community Based Services (HCBS) Waivers. To qualify for HCBS Waivers, applicants must meet medical and financial requirements. The state will assess applicants to see if they meet the medical requirements, but it’s up to the applicants to prove they meet the financial requirements with official documents detailing their finances. Even if applicants don’t meet the financial requirements, there are still ways they can become eligible.
Every state has its own Home and Community Based Services (HCBS) Waivers, and many states have several HCBS Waiver programs. Applicants need to research the available HCBS Waivers in their state and find the one that best fits their long-term care needs. They can start by using our 50-State Guide, which provides an overview of the HCBS Waivers in every state. Applicants can also learn about available HCBS Waivers through their local Medicaid offices. They can find contact information for those offices by clicking here and using the “Contact Your State Medicaid Agency” tool.
As you’re researching available HCBS Waivers, you should find out their medical requirements. When you have found a suitable waiver and know its medical requirements, move on to Step 2.
Most HCBS Waivers require applicants to need a Nursing Facility Level of Care (NFLOC), which means they need the kind of constant care and supervision usually found in nursing homes. Some HCBS Waivers only require applicants to be at risk of needing a NFLOC, but all of them do require applicants need a significant level of care.
The definition of NFLOC varies from state to state, but in general it depends on the applicant’s ability to complete the Activities of Daily Living:
A senior who needs help with three of the five Activities of Daily Living might be considered to need a NFLOC in some states, while in other states they might only need help with two of the five to meet the criteria. Behavior is taken into consideration in some states when determining NFLOC, as are cognitive issues. However, a diagnosis of Alzheimer’s disease or other dementia does not automatically designate a senior as needing a NFLOC.
If applicants meet the medical (also called functional) criteria for HCBS Waivers, they can move on to Step 3: Assess Financial Eligibility and Gather Financial Documents. Even if they don’t meet the medical criteria, they can still go to Step 3 to see if they meet the financial requirements. If they don’t meet the financial requirements either, there are strategies that can help them become financially eligible, and some of them need to be implemented well ahead of time – like before applicants need care or meet the medical requirements. So, a senior could begin implementing one of those long-range strategies (like a Medicaid Asset Protection Trust), and by the time they meet the medical requirements they will also meet the financial requirements.
To know if they’re financially eligible for HCBS Waivers, applicants need to find the specific asset limit and income limit for their particular situation. In most states in 2024, the individual asset limit for HCBS Waivers is $2,000. This means the total value of an applicant’s countable assets must be $2,000 or less. Countable assets include bank accounts, retirement accounts, bonds, cash, second vehicles or homes and luxury items. Some assets are exempt (not countable), such as primary vehicles, clothes, wedding rings, household appliances and furniture and, in most cases, the applicant’s home.
The individual income limit for HCBS Waivers in most states in 2024 is $2,829/month. Almost all income is counted toward the limit, like Social Security benefits, retirement account payouts, pension payments, wages, alimony and rental income.
These asset and income limits can vary by state, the applicant’s marital status and if their spouse is also applying for Medicaid. To find the exact financial criteria for your situation, use our Medicaid Eligibility Requirements Finder by clicking here.
While applicants are evaluating their finances, they should also be gathering official documents from their financial institutions to verify their situation. These documents will be submitted along with the HCBS Waivers application, and the burden of proof is on the applicant to prove they meet the financial limits. In most cases, they will need to document their finances going back five years from the date of their application due to Medicaid’s Look-Back Period.
Gathering the correct financial documents is often the most time-consuming part of the application process. Applicants should start requesting and collecting these documents as soon as possible. They might include:
Checklist: For a more comprehensive list of the documents you may need when applying for HCBS Waivers, see our Medicaid Long Term Care Application Documents Checklist by clicking here.
If you believe you are financially eligible for HCBS Waivers, go to Step 6: Complete and Submit Your Application.
If you believe you are over the financial limits, there are still ways you can qualify for HCBS Waivers, so go to Step 5: Alternative Pathways to Eligibility.
Even if you don’t meet the financial limits for Home and Community Based Services (HCBS) Waivers, there are still ways you can lower your countable resources and become eligible. These methods can be complicated, just like Medicaid’s rules, so we recommend consulting with a professional like an Elder Law Attorney or a Certified Medicaid Planner before attempting them on your own.
Strategies for Excess Income
The available methods for lowering income to meet the HCBS Waiver limit depends on the state where you live and whether it is a Medically Needy state or an Income Cap state. In states that offer the Medically Needy Pathway, applicants and beneficiaries spend their excess monthly income on unpaid medical expenses to become eligible for HCBS Waivers. In Income Cap states, applicants and beneficiaries deposit their excess monthly income in Qualified Income Trusts to become eligible.
As of 2024, the following states offer a Medically Needy Pathway: Arkansas, California, Connecticut, Florida, Georgia, Hawaii, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nebraska, New Hampshire, New Jersey, New York, North Carolina, North Dakota, Pennsylvania, Rhode Island, Utah, Vermont, Virginia, Washington, West Virginia and Wisconsin, as well as the District of Columbia. If your state is not on this list, it is an Income Cap state.
Strategies for Excess Assets
Applicants have several choices when it comes to lowering their assets to reach their HCBS Waivers asset limit. Click on any of the underlined items in the list below to learn more about them. To read an article focused on Medicaid planning strategies, click here.
There are numerous types of Medicaid applications, so the first part of this step is finding the right application for the right HCBS Waiver. The application can be digital and completed and submitted online, or it can be paper and submitted in person or by mail. To find the right application form for the HCBS Waiver you want to apply for, you can reach out to your local Medicaid office by using the “Contact Your State Medicaid Agency” tool on this official Medicaid.gov webpage.
Before you submit the application, it’s a good idea to find a knowledgeable person to check it over for you, especially the calculations and documents concerning financial eligibility. It’s easy to make an error on a Medicaid Long Term Care application, but they will probably lead to a denial, and applying correctly the first time is less time-consuming than appealing a denial. Your local Area Agency on Aging may have staff that will check Medicaid applications for mistakes. The state Medicaid office might also offer this service. Or applicants can contact a professional like a Certified Medicaid Planner or an Elder Law Attorney.
By law, Medicaid state offices are supposed to approve or deny an application within 90 days. However, states offices are often given more time to process applications and it can take longer than 90 days for the state to reply. The time between submitting an application and getting a reply is known as “Medicaid Pending.” Some caregivers may be willing to provide services and supports to seniors who have Medicaid Pending status without getting paid immediately. These caregivers are assuming that the senior will be approved for Medicaid and the state will retroactively pay for the services and supports once the senior is approved, which is what happens with Medicaid Pending. However, if the applicant is not approved for HCBS Waivers, they will be responsible for paying for their unpaid bills.
Even if you’re eligible and you complete your application correctly, you may still have to wait before receiving HCBS Waiver benefits. That’s because most HCBS Waivers have a limited number of enrollment spots, and once those spots are full, additional applicants are placed on a waitlist. These waitlists can last for months or years, and the way applicants are taken off the list can vary by state. To learn more about Medicaid waitlists, click here.
Medicaid eligibility is complicated, and the application process is full of potential pitfalls. Families should consider working with a Medicaid Planning professional when applying. These fee-based experts help people become eligible, while streamlining the application process and preserving assets for spouses and family members.
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