2025 Medicaid Law Update

According to the U.S. Department of Health and Human Services, approximately 70% of Americans aged 65 and up will need some type of long-term care during their lifetimes. Unfortunately, that care is increasingly expensive, and costs often outpace even the most carefully managed savings.

Fortunately, Medicaid makes it possible for many seniors who need long-term care to get benefits to pay for that care. Unfortunately, Medicaid is one of the most complicated areas of the law. Even the U.S. Supreme Court has said “The Medicaid program is a ‘massive, complex’ undertaking that involves the cooperation of the federal government and the states, with each level of government responsible for different aspects of its administration.” Obviously, one needs to work with an expert such as BRMMLAW to help navigate these complicated laws.

To ensure that the program is helping those who need it most, there are asset and income limits. Those limits vary by state and are adjusted annually. Limits also vary by the type of care needed and whether the applicant is single, married with both spouses applying, or married with only one spouse applying.

Michigan Medicaid Income and Asset Limits for 2025

Individuals who need a nursing facility level of care may receive services either in a facility (nursing home) or through home- and community-based programs. Other individuals may require a lower level of care: help with activities of daily living such as mobility, dressing, eating, personal hygiene, and toileting. If they meet asset and income limits, they are eligible for Regular Medicaid for Aged Blind and Disabled, which provides benefits to help with medical expenses.

For single Medicaid applicants in Michigan, the 2025 countable income and asset limits are as follows:

For married applicants who are both applying for benefits in Michigan, 2025 income and asset limits are:

For a married applicant whose spouse is not applying for benefits in Michigan, 2025 income and asset limits are:

Note that having income or assets that exceed the amounts listed doesn’t mean that you or your spouse would be unable to qualify for Medicaid benefits; however, if your income and assets are less than the amount listed, you may be immediately eligible.

If you were reading carefully above, you may have noticed a reference to “countable” income and assets. What exactly does that mean?

Countable vs. Non-Countable Income

Not all income is considered when determining an applicant’s eligibility for Medicaid benefits. In general, the following sources of income are considered “countable” income for a Medicaid applicant in Michigan:

• Wages from employment
• Pension payments
• VA non-service connected pensions
• Annuity payments
• Social Security Disability Insurance (SSDI)
• Social Security retirement benefits
• Unemployment benefits
• Rental income
• Dividends and interest income
• Spousal support (alimony)

The list of non-countable income includes Supplemental Security Income (SSI); certain VA benefits such as Aid & Attendance; SNAP benefits; and student financial aid.

What happens when a Medicaid applicant who needs nursing-home level care is married, and their spouse is not applying for benefits? In these situations, only the income of the applicant spouse is counted. The income of the other spouse does not affect the applicant’s eligibility for benefits.

If needed to avoid impoverishment, the non-applicant spouse may be entitled to a Minimum Monthly Maintenance Needs Allowance (MMMNA) from the applicant spouse’s income. Currently, if a non-applicant spouse in Michigan has a monthly income of less than $2,555, they can get an MMMNA from the applicant spouse to bring their income up to this level.

Countable vs. Non-Countable Assets

In Michigan, countable assets that affect Medicaid eligibility include:

• Cash, including money in savings accounts or checking accounts
• Stocks, bonds, and mutual funds
• Retirement accounts, including IRAs
• Real estate other than a primary home
• Vehicles other than a primary vehicle
• Certain types of trusts, including revocable living trusts
• Life insurance with a cash value above the exemption limit in Michigan.

Certain assets are exempt from consideration for Medicaid eligibility, including a primary home, one vehicle, household goods and personal belongings, prepaid funeral and burial plans, among others.

Unlike income, which may be attributed only to an applicant spouse or a non-applicant spouse, assets (resources) of a married couple are considered to be owned jointly. However, spousal impoverishment rules are in place to prevent a non-applicant spouse from losing all of their assets to the nursing home. A non-applicant spouse, also referred to as the “community” spouse, can keep 50% of the couple’s resources, up to $157,920 in 2025.

To make matters worse Michigan can recover assets to pay for the cost of care when the Medicaid recipient passes away. Fortunately, it is easy to avoid Michigan’s estate recovery with the proper guidance from an expert in estate recovery.

Last there is a five-year lookback on all gifts prior to an application for benefits. Simply put the concept is the money gifted could have been spent on care and therefore one will be penalized. It is important to note there are many special exceptions to the give-year rules.

Get Help With Medicaid Planning

You may not need Medicaid benefits now, but you may someday. Planning ahead to protect your assets can allow you to become eligible for Medicaid help when you need it, without sacrificing all you have worked for to the nursing home.

The knowledgeable Medicaid planning attorneys at Barron, Rosenberg, Mayoras & Mayoras work with clients who want to protect their hard-earned assets and income. Schedule a consultation today by calling (248) 213-9514 in Michigan or (941) 222-2199 in Florida to learn how we can assist you. You can also use our simple online contact form.