What Happens with Medicaid Long Term Care Coverage When Moving From State to State

Summary
Medicaid Long Term Care coverage cannot be directly transferred from state to state. Instead, a Medicaid recipient who is moving out of state must end their Medicaid coverage in the state they are leaving and then reapply in their new state. The process can be complicated, but proper research and advance planning, it is possible with minimal or no loss of coverage.

 

Moving Out of State With Medicaid: State Eligibility Requirements

Although Medicaid is federally funded, each state runs its own Medicaid program and eligibility requirements for Medicaid Long Term Care coverage can change from state to state. The differences in requirements prevents a simple transfer of Medicaid Long Term Care coverage from state to state – just because someone was eligible for Medicaid in one state does not mean they will be eligible for Medicaid in another state.

 

Financial Eligibility

Medicaid Long Term Care is intended for people with limited financial means. In order to be eligible, a person must meet an asset limit and an income limit. The good news for a Medicaid recipient moving from one state to another is that these financial limits are fairly consistent across states – generally speaking, the limit is $2,000 for assets and either $841 / month or $2,523 / month for income. So, when a relocating Medicaid recipient is re-applying for Medicaid in their new state, chances are good they will be financially eligible because they were already judged to be financially eligible in their old state.

 Checking State Criteria – One can check their financial eligibility criteria for any state using our Search Tool. For persons moving, check your old and new states to compare.

Check State by State Financial
Even though the financial rules are mostly the same across states, there can be some differences. New York, for example, has a $16,800 asset limit for 2022. So, a person with $10,000 in assets might have been Medicaid eligible in New York, but if they move to a state with a $2,000 financial limit they would have to “spend down” $8,000 of their assets in Medicaid-approved fashion to become Medicaid eligible in their new state.

 

Functional Eligibility

In addition to meeting financial requirements, many (but not all) Medicaid Long Term Care applicants are also required to meet a functional requirement. The functional (or medical) requirement is needing a Nursing Home Level Of Care. However, the definition of Nursing Home Level of Care varies by state, which means functional requirements for eligibility vary by state.

The differences in NHLOC definitions often revolve around Activities of Daily Living (ADL). These Activities of Daily Living are usually grouped into five general categories: bathing, dressing, eating, using the bathroom and being able to get in and out bed/up and down from a sitting position. Some states might consider a person who can only perform three or fewer ADLs as functionally eligible for Medicaid, while other states might limit eligibility to people who can only perform two or fewer ADLs. This could present a problem, for example, for a person who can perform three ADLs and is living in a state where that meets Medicaid eligibility requirements, but is then moving to a state where it does not meet requirements.

In most cases, determining NHLOC and functional eligibility also includes evaluations by physicians and other medical professionals. These will, by nature, vary somewhat from state to state and doctor to doctor, which means the functional eligibility requirements can also change.

 It’s a good idea to get the necessary medical evaluations in a potential new state done ahead of time so the Medicaid recipient can know if they will continue to be functionally eligible in their new state. If not, the high cost of private long term health care might prohibit the move.

 

Moving Out of State With Different Types of Medicaid Long Term Care

The scope of Medicaid Long Term Care coverage also varies by state, which is another barrier to a simple transfer of Medicaid coverage for someone moving out of state. Just because Medicaid covered a long term care service in one state doesn’t mean it will cover that same service in another state.

Each state has three basic Medicaid Long Term Care programs – Nursing Home Medicaid, Home and Community Based Services (HCBS) Waivers, and Aged Blind and Disabled (ABD) Medicaid.

 

Nursing Home Medicaid

The extent of the coverage for Nursing Home Medicaid doesn’t vary much by state – Medicaid will, essentially, cover all the expenses associated with living and receiving health care in a nursing home. So, a Nursing Home Medicaid recipient who is moving out of state can expect to receive roughly the same benefits in their new state that they were receiving in their old state, once they have canceled their Medicaid coverage in the old state and reapplied for it in the new state.

Nursing Home Medicaid recipients are required to need a Nursing Home Level of Care as their functional criteria. They also must meet the financial criteria of an asset limit ($2,000 in most states for 2022) and an income limit ($2,523 / month in most states for 2022). It should be noted, however, that Nursing Home Medicaid recipients are only allowed to keep a small part of their monthly income known as a “personal needs allowance” (usually between $30-$150 and these are state-specific) and must give the rest of their monthly income to the state to help offset the cost of Medicaid coverage.

 

ABD Medicaid

Like with Nursing Home Medicaid, the scope of ABD Medicaid coverage does not change much from state to state, which means an ABD Medicaid recipient who is moving from one state to another can expect the same level of care in both places. However, ABD Medicaid applicants/recipients do not need to prove a Nursing Home Level of Care. They only need to be aged (65 or older), blind or disabled.

ABD Medicaid applicants/recipients do have to meet stricter income limits (as low as $841 / month in most states for 2022), although the asset limit for ABD Medicaid in most states is $2,000 in 20222, just like it is for the other two Medicaid programs. But ABD Medicaid recipients do get to keep all of their income, and not just a personal needs allowance like Nursing Home Medicaid recipients.

For ABD Medicaid recipients who continue to live at home, the home will not be counted against the asset limit as long as it is their primary residence and under the home equity limit of the state ($636,000 or $955,00 in 2022, except in California, where there is no limit). Home furniture, clothes, a vehicle and other basic living necessities are also exempt from the income limit in these cases.

 

Home and Community Based Services Waivers

While moving with Nursing Home or ABD Medicaid can be a straightforward process. That’s not the case when it comes to moving out of state with Home and Community Based Services (HCBS) Waivers.

The scope of coverage for HCBS Waivers can vary greatly by state. For example, some states may pay for adult day care using an HCBS Waiver, while other states may not pay for adult day care at all. As the name suggests, HCBS Waivers are for Medicaid recipients who continue to live at home or in the community (maybe with a family member, or in an assisted living facility), but Waivers can also vary from state to state when it comes to how many in-home doctor’s visits are covered, or how many hours of in-home therapy, or the level of home-modification that’s covered.

What makes moving with HCBS Waivers coverage even more complex is the fact that it is not an entitlement program. Nursing Home and ABD Medicaid are entitlement programs, which means that if an applicant is eligible for either coverage, the government is legally required to provide them with that coverage. HCBS Waivers applicants, on the other hand, are not guaranteed coverage even if they are eligible. Instead, each state puts limits on all of their HCBS Waivers (the number and kind of Waivers also vary by state) in terms of beneficiaries. Once that limit is reached, the remaining qualifying applicants will be put on a wait list to become beneficiaries. Wait list length ranges from weeks to years.

So, someone who was receiving Medicaid benefits through a Waiver in one state might have to wait before receiving the same benefits in another state, even if they are eligible for those benefits.

HCBS Waivers applicants must prove a need for a Nursing Home Level of Care as a functional requirement for eligibility. They also must meet an asset limit ($2,000 for 2022) and an income limit ($2,523 / month in most states for 2022) as financial requirements for eligibility. HCBS Waivers applicants are allowed to keep all of their monthly income, and their home will not count against the asset limit as long as it is their primary residence and meets the home equity limits of the state ($636,000 or $955,00 in 2022, except in California, where there is no limit).

 

How Retroactive Medicaid Helps in the Moving Process

A common worry among Medicaid Long Term Care recipients who are moving out of state is having a lapse in benefits. This is understandable since it’s not possible to simply transfer Medicaid coverage from one state to another, and having Medicaid coverage in two states at the same time is not allowed, either.

These circumstances will lead to a lapse in coverage for a Medicaid recipient moving out of state because coverage in their old state will end before the application in their new state is approved. However, Retroactive Medicaid will pay for the expenses accrued during that lapse, up to three months, as long as the Medicaid applicant is eligible for Medicaid coverage in their new state during that time. Worth noting though is that some states are beginning to limit their retroactive Medicaid coverage.

While the three-month window Retroactive Medicaid provides for someone to apply for Medicaid Long Term Care in a new state is not especially big, it should be big enough There are no residency requirements for Medicaid, so a person can apply for Medicaid on the first day they become a resident in a new state. And the application process for Medicaid approval does not take very long, usually between 15 and 90 days.

Still, research and planning ahead of time are essential for any Medicaid recipient making an out-of-state move. By doing the right legwork, a person can determine whether or not they will be Medicaid eligible in their new state. If not, they may want to reconsider the move given the expense of private long term health care.