The Arizona Medicaid income limits for long-term care run through ALTCS, an income-cap program where an over-cap applicant must funnel the excess through an Income-Only Trust to qualify.
Arizona doesn't pay for nursing-home or in-home long-term care through regular Medicaid. It runs a separate program called the Arizona Long Term Care System (ALTCS), and it works on a hard income cap rather than a spend-down. This guide walks through the 2026 income and asset rules for ALTCS, what the income cap is, how the Income-Only Trust (Arizona's name for a Miller Trust) rescues an over-income applicant, what a nursing-home resident keeps, and what a spouse at home is protected from.
How ALTCS works: AHCCCS, but for long-term care
Arizona's Medicaid program is the Arizona Health Care Cost Containment System (AHCCCS, pronounced "access"), and it's run differently from almost every other state's. Where most states bolted managed care onto fee-for-service over time, Arizona has been a fully managed-care Medicaid program since 1982.
Long-term care is its own track inside AHCCCS, called ALTCS. To get ALTCS, an applicant has to clear two separate gates: a medical/functional gate (you must need a nursing-facility level of care, confirmed by a Preadmission Screening) and a financial gate (the income and asset limits below). Clearing one without the other doesn't qualify you. The rest of this guide is about the financial gate, where most of the planning happens.
The Arizona Medicaid income limits and the income cap
ALTCS sets its 2026 income limit at $2,982/month, which is exactly 300% of the SSI Federal Benefit Rate ($994 for 2026). This is the "Special Income Level," the same 300% figure other income-cap states use.
Here's where Arizona diverges from spend-down states. In a state like Illinois or California, income above the standard doesn't disqualify you; you just spend the excess on care each month. Arizona is an income-cap state: if your gross monthly income is over $2,982, you are flatly ineligible for ALTCS, no matter how high your care costs are, unless you take one specific step. That step is the Income-Only Trust.
The Income-Only Trust (Arizona's Miller Trust)
An Income-Only Trust, the term Arizona uses for what most states call a Qualified Income Trust or Miller Trust, is the workaround for the income cap. It's an irrevocable trust into which the applicant deposits the income that exceeds the cap each month. The deposited income no longer counts against the $2,982 limit, so the applicant qualifies; the trust funds are then spent on the applicant's care under strict rules, and whatever remains at death goes to the state up to the amount Medicaid paid.
The trust doesn't make the income disappear or shelter it. It re-routes it so the gross-income test is met while the money still goes toward care. The point people miss: in an income-cap state, having "too much" income is a paperwork problem, not a disqualifier. You set up the trust, fund it each month, and you're in.
The $2,000 asset limit
Separate from income, ALTCS limits a single applicant to $2,000 in countable assets ($4,000 for a married couple when both spouses apply, $2,000 each). Arizona, unlike a handful of states that raised their asset limits, holds to the long-standing federal figure.
"Countable" is the word that matters. ALTCS exempts a long list of assets from the count: your home (subject to an equity cap of $752,000 for 2026), one vehicle, household goods and personal effects, and prepaid burial arrangements. So the $2,000 applies to bank accounts, investments, a second vehicle, and the like, not the roof over your head.
The asset limit and the income cap are independent tests. An Income-Only Trust solves an income problem; it does nothing for assets. An applicant over the $2,000 asset limit has to reduce countable resources legitimately (spending down on the applicant's own care, the home, exempt items) rather than giving them away, which runs into the look-back below.
The five-year look-back
ALTCS reviews asset transfers made in the 60 months before a long-term-care application. Giving away money or property for less than fair market value during that window, signing a house over to a child for a dollar, gifting a grandchild a down payment, can trigger a penalty period during which ALTCS won't pay for long-term-care services even though you otherwise qualify.
There are legitimate exceptions (transfers between spouses, transfers to a disabled child, certain caregiver-child home transfers) and legitimate planning approaches, but anything done inside the five-year window deserves an elder-law attorney's review first. If long-term care is on the horizon for someone in your family, talk to a professional before moving assets. For the broader toolkit, see our guide to Medicaid planning strategies.
Long-term care: what a nursing-home resident keeps
When ALTCS pays for nursing-facility care, the resident contributes almost all of their monthly income toward the cost of care. What they keep is the Personal Needs Allowance (PNA), money reserved for the resident's own small expenses (clothing, a haircut, a phone). Arizona sets its PNA at $149.10/month, far above the $30 federal floor.
For a resident who needed an Income-Only Trust to qualify, the mechanics stack: income flows into the trust, the PNA and any spousal allowance come off the top, and the remainder is paid to the facility. (For the national picture on the PNA and how it's set, see our explainer on the Medicaid personal needs allowance.)
Protecting the spouse who stays home
When one spouse needs long-term care and the other remains in the community, federal spousal-impoverishment rules keep the at-home spouse from being left destitute. Arizona applies the federal figures for 2026:
| Protection | 2026 Amount | What it does |
|---|---|---|
| Community Spouse Resource Allowance (CSRA) | Up to $162,660 (maximum); minimum $32,532 | The most in countable assets the at-home spouse may keep, on top of the applicant's own $2,000. Arizona allows half the couple's countable assets up to the maximum. |
| Minimum Monthly Maintenance Needs Allowance (MMMNA) | $2,643.75 to $4,066.50/month | The monthly income the at-home spouse is allowed; income can be shifted from the applicant to reach it. The $4,066.50 maximum took effect January 1, 2026. |
| Home-equity limit | $752,000 | Equity in the primary residence above this amount is countable for ALTCS eligibility. |
So a married couple is in a very different position from a single applicant. The community spouse can hold up to $162,660 in assets and keep a monthly income allowance up to $4,066.50 while the other spouse receives ALTCS-funded care.
After death: estate recovery
Like every state, Arizona runs a Medicaid estate-recovery program. After a recipient who was 55 or older and received long-term-care services dies, the state may seek repayment from the estate, unless the recipient is survived by a spouse or a minor, blind, or disabled child. Federal exceptions apply, and an undue-hardship waiver exists. For how estate recovery works and where families have room to plan, see our Medicaid estate recovery explainer.
How to apply for ALTCS in Arizona
ALTCS is run by AHCCCS, and the application is handled through the ALTCS office rather than a generic Medicaid portal. You have two main routes:
- Online through Health-e-Arizona Plus at healthearizonaplus.gov, the state's combined application for AHCCCS, SNAP, and cash assistance.
- By phone to the ALTCS office at 1-888-621-6880, which is often the better path for long-term-care applicants because of the medical screening involved.
Every ALTCS applicant goes through a Preadmission Screening to confirm they need a nursing-facility level of care, separate from the financial review. Apply even if your income is over the cap. With an Income-Only Trust, being over $2,982/month is a solvable problem, not a wall.
Frequently Asked Questions
The 2026 ALTCS income cap is $2,982/month, equal to 300% of the SSI Federal Benefit Rate. Arizona is an income-cap state, so income above that figure makes you ineligible unless you set up an Income-Only Trust (a Miller Trust) and deposit the excess into it each month.
$2,000 in countable assets for a single ALTCS applicant, and $4,000 for a married couple when both spouses apply. The home (up to $752,000 in equity), one vehicle, household goods, and prepaid burial arrangements are exempt from the count.
Yes, if your gross monthly income exceeds the $2,982 ALTCS cap. Arizona calls it an Income-Only Trust, but it's the same instrument other states call a Qualified Income Trust or Miller Trust. The excess income goes into the irrevocable trust each month, which brings you under the cap while the money still goes toward your care.
For 2026, the at-home (community) spouse can keep up to $162,660 in countable assets (the Community Spouse Resource Allowance, minimum $32,532) and a monthly income allowance ranging from $2,643.75 up to $4,066.50 (the Minimum Monthly Maintenance Needs Allowance). The home is also generally protected up to $752,000 of equity.
A Personal Needs Allowance of $149.10/month, well above the $30 federal minimum. The rest of the resident's monthly income goes toward the cost of care, after deductions for a community spouse and certain health-insurance premiums.
Apply online through Health-e-Arizona Plus at healthearizonaplus.gov, or call the ALTCS office at 1-888-621-6880. Every applicant also goes through a Preadmission Screening to confirm a nursing-facility level of care, which is separate from the financial eligibility review.
Learn More
- Medicaid Planning Strategies
- How Medicaid Estate Recovery Works
- The Medicaid Personal Needs Allowance, Explained
Find personalized help working through Arizona ALTCS eligibility and the Income-Only Trust rules for your family at brevy.com.
The information on Brevy.com is for educational purposes only and is not a substitute for professional legal, financial, or medical advice. Rules vary by state and program and change frequently. Always verify with the relevant agency or a qualified professional. Brevy is not a law firm, financial advisor, or healthcare provider.