What Medicaid Covers in a Nursing Home

What Medicaid Covers in a Nursing Home

If your loved one is approved for Nursing Home Medicaid and admitted to a Medicaid-certified facility, Medicaid typically covers room and board and necessary nursing-facility services: nursing care, aides, therapies ordered by the care team, routine medical supplies, and medications covered under the facility’s policy. Some extras like a private room (unless medically needed), special amenities, or non-covered personal items may still be out-of-pocket. Always ask admissions for the facility’s Medicaid coverage list and any add-on fees.

For people living with dementia, Medicaid also covers care in nursing home memory-care units (special-care units) when the person meets the program’s medical and financial rules. Staff in these units are typically trained for dementia-related needs such as wandering or agitation.

Need and Financial Eligibility

1) Medical / Functional Need (Level of Care)

States require proof that the person needs the intensity of care delivered in a nursing facility. Evaluators look at Activities of Daily Living (ADLs) bathing, dressing, eating, toileting, transferring/ambulation plus safety risks and cognitive/behavioral factors. A dementia diagnosis strengthens but doesn’t automatically ensure this determination; assessors still document how cognitive impairment affects supervision and hands-on help. In many states (including Pennsylvania), this standard is often called Nursing Facility Level of Care (NFLOC) or Nursing Facility Clinically Eligible (NFCE).

2) Financial Eligibility (Income and Assets)

Medicaid is needs-based. Applicants must fall under state-specific income and asset limits (updated annually and varying by marital status). The community spouse can often keep a significant share of assets and income under “spousal impoverishment” protections. Check your state’s current figures before you apply.

Common Paths Into a Nursing Home

• Direct Admission with Medicaid Approval (or Medicaid-Pending): If a facility accepts Medicaid-Pending, you might be admitted while the application is processed. Not all facilities do this, and bed availability can be limited. Keep a short list of Medicaid-certified homes and ask specifically about Medicaid-Pending and waitlists.
• Medicare “Skilled Stay” as a Bridge: After a qualifying inpatient hospital stay (generally three midnights) and a physician’s order for skilled care, Medicare Part A may cover up to 100 days of rehab/skilled nursing. Families often use this period to complete Medicaid planning if a long-term stay will be needed afterward.
• Private-Pay “Spend-Down”: If income/assets are over limits, some families privately pay the facility and spend down assets on care until they meet Medicaid thresholds bearing in mind the look-back rules on gifting. In certain states, medically needy “spend-down” pathways can also apply to income, functioning like a deductible that allows eligibility once medical expenses reduce countable income.

Prepare

1. Document the Care Need. Ask your parent’s clinician for notes detailing ADL dependence, falls, wandering, medication errors, behavioral changes, and supervision required. If your state uses a formal NFLOC/NFCE assessment, schedule it early; many states also require PASRR-related screenings for nursing-home entrants.
2. Get Financials in Order. Assemble five years of bank statements, tax returns, deeds/titles, life-insurance cash values, retirement accounts, and proof of income.
   If married, gather the spouse’s records too. Identify any gifts or transfers in the last 60 months and speak with an elder-law professional if there are red flags.
3. Build Your Facility Short List. Focus on Medicaid-certified nursing homes near family, and if dementia is present ask specifically about secured memory-care units, staff training, and behavior-management capacity. Confirm policies on Medicaid-Pending and average wait times for Medicaid beds.
4. Apply Through Your State’s Medicaid Portal or Local Office. States provide online and in-person options via the Department of Human Services (or equivalent). Use checklists and FAQs to avoid clerical denials.
5. Plan for Interim Coverage. If a hospital stay qualifies, leverage a Medicare skilled-nursing benefit as a bridge. If not, ask facilities whether Medicaid-Pending is possible, or prepare for a short private-pay period while your application is reviewed.
6. Appeal if Denied. Many denials relate to missing paperwork, unclear functional evidence, or look-back issues. You have appeal rights; respond quickly, fix deficiencies, and continue coordinating with the facility and your caseworker.

Pitfalls to Avoid

• Assuming dementia = automatic approval. Function and safety drive NFLOC decisions; be thorough in describing daily realities.
• Gifting during the 5-year look-back. Transfers for less than fair market value can delay eligibility for months or years.
• Waiting until a crisis. Applications, assessments, and bed searches take time start early.
• Overlooking non-nursing-home avenues. If your parent isn’t quite at nursing-home level, ask about HCBS waivers, adult day health, in-home aides, and dementia-specific supports (e.g., programs inspired by CMS’s GUIDE model).

How to Choose a Nursing Home

• Clinical Capacity: Experience with dementia, antipsychotic-use oversight, fall prevention, and staff-to-resident ratios on evenings/nights.
• Environment: Secured units with safe wandering paths; calm common areas; signage and cues for orientation.
• Care Planning: How the team individualizes routines, communicates with families, and handles transitions (hospitalizations, hospice).
• Transparency: Clarity on what Medicaid covers vs. resident responsibility; candid admissions policies about Medicaid-Pending and waitlists.

Bottom Line

Medicaid can make long-term nursing home care financially possible when your parent meets medical (nursing-facility level of care) and financial (income/assets) criteria. For families living with dementia, frame your application around real-world safety risks, ADL dependence, and the ongoing need for 24/7 supervision then choose a facility that truly understands dementia care. Start early, gather documentation, and use your state’s application portal and local resources to avoid delays.

References

1. A Place for Mom “Medicaid and Nursing Homes: Coverage, Eligibility Requirements, and How to Apply.
2. Commonwealth of Pennsylvania (DHS) “Apply for Long-Term Care Services.”
3. MedicaidLongTermCare.org “Pennsylvania Medicaid Programs for Long-Term Care.”
4. Centers for Medicare & Medicaid Services (CMMI) “Guiding an Improved Dementia Experience (GUIDE) Model.”
5. PA Elder Law “Medicaid 5-Year Look-Back in Pennsylvania: Penalties and Rules.”