Texas Medicaid Planning – The Asset Test
For many seniors and individuals with disabilities, Medicaid is a critical source of financial support for long-term care. However, qualifying for Medicaid isn’t automatic—it requires applicants to meet strict economic criteria, including limits on income and assets. One of the most challenging aspects of eligibility is the Medicaid asset test, which evaluates an applicant’s available resources to ensure they fall below a certain threshold.
Without proper planning, individuals risk spending down their savings unnecessarily or being denied benefits altogether. By understanding the asset test and planning accordingly, you can protect your assets while securing the care you need.
What is the Medicaid Asset Test?
The Medicaid asset test is a financial evaluation used to determine whether an applicant’s resources fall within the limits required to qualify for Medicaid. In Texas, applicants must have less than a set amount of countable assets, which include cash, savings, investments, and additional real estate beyond the primary residence.
Certain non-countable assets—such as a primary residence, one vehicle, and personal belongings—are excluded from this calculation. The goal of the asset test is to ensure that Medicaid benefits are provided to those who truly need financial assistance for long-term care. Anyone above the threshold will not qualify.
Asset Threshold for Single Individuals
For a single individual applying for Medicaid in Texas, the asset test requires that countable assets must not exceed $2,000. Applicants may need to “spend down” their countable assets to meet eligibility requirements. Strategic Medicaid planning, such as converting countable assets into exempt ones, can help preserve wealth while ensuring eligibility for benefits. There are rules when it comes to spending down assets and doing it the wrong way can have significant consequences.
Asset Threshold for Married Couples
In situations where both spouses apply for benefits, their combined assets must not exceed $3,000. When only one spouse needs care, the asset test operates differently to protect the financial well-being of the healthy spouse, known as the community spouse. The couple’s joint assets are assessed together, but the community spouse is allowed to retain a portion of the assets through the Community Spouse Resource Allowance (CSRA). In Texas, this allowance permits the community spouse to keep a significant amount of assets, while the spouse applying for Medicaid must reduce their countable assets to $2,000. Proper planning can help preserve more of the couple’s wealth.
Talk to a Lawyer About Qualifying Under the Asset Test
Meeting the Asset Test is only the first step in securing benefits through Medicaid. You need a proper plan that sets you up for success and ensures you qualify for the benefits you need moving forward. Contact J. Nichols Law today to discuss your options during a private consultation.