Illinois Medicaid Spousal Impoverishment 2026: CSRA & MMMNA

Illinois Medicaid spousal impoverishment rules protect the at-home spouse when one partner needs nursing home care. In 2026 she keeps all of her own income and, under Illinois's standard, up to $143,172 in countable assets.1,2

How Illinois Medicaid Spousal Impoverishment Works

When one spouse enters a nursing facility, Illinois applies federal spousal impoverishment protections under 42 USC § 1396r-5. These rules have two parts that work together: a resource (asset) protection for the at-home spouse, and an income protection.2,4

Income or assets above Illinois's limits don't by themselves bar the spouse who needs care. Illinois handles them through spenddown: a long-term-care applicant over the income standard or the resource limit is approved as spenddown unless they say in writing that they don't want it.5 Spenddown governs how the spouse in care qualifies; the CSRA and the income allowance below govern what the at-home spouse keeps.

The at-home spouse is called the community spouse. The spouse entering long-term care is called the institutionalized spouse. Throughout this guide, those are the terms we'll use.

How the CSRA Works

The Community Spouse Resource Allowance (CSRA) is the amount of countable assets the community spouse gets to keep when the institutionalized spouse applies for Medicaid long-term care coverage. At application, federal law counts everything either spouse owns, in either name or both, as available to the institutionalized spouse, except the CSRA.4

Which Date DHS Looks At

Federal law puts two dates in play. It totals the couple's resources as of the start of the institutionalized spouse's first continuous stay in a facility, and either spouse can ask the state then to assess and document that total; each spouse gets a copy, with notice of the right to a fair hearing.4 Eligibility itself is tested at application, against the CSRA in effect at that time.4

In Illinois, DHS subtracts the CSRA from the total non-exempt resources of both spouses, and the remainder is available to pay for the institutionalized spouse's care.1 Keep account statements from both dates, and ask DHS which figures it is using in your case.

What the $143,172 Standard Means

Federal law sets two 2026 resource standards, a minimum of $32,532 and a maximum of $162,660, and each state elects its standard within that range.2

Illinois sets its own CSRA standard rather than adopting the federal maximum. The Illinois Department of Human Services policy manual says the CSRA, up to $143,172.00, isn't considered available to pay for care on applications received on or after January 1, 2026, and the DHS worker manual lists the same figure, in a state-specific series that ran $129,084 in 2024 and $135,648 in 2025. It's a flat allowance, not half of the couple's assets.1

That standard isn't an absolute cap. Under the federal formula, a CSRA set at a fair hearing or transferred under a court order can lawfully be higher.2 In Illinois's manual, the CSRA can exceed $143,172.00 only if a court order sets a different resource allowance, or an appeal decision finds that more income-producing resources are needed to raise the community spouse's income to the maximum CSMNA (see the fair hearing section below).1

A worked example illustrating the standard:

The figures below are hypothetical and shown only to illustrate how the calculation works. They are not a real case and not a prediction of your own result.

A couple in Chicago has the following countable assets: $120,000 in joint savings, $80,000 in the institutionalized spouse's IRA, and $40,000 in the community spouse's brokerage account. Total: $240,000.1

Illinois doesn't split that total in half. The community spouse can keep up to the $143,172 standard, and the institutionalized spouse can keep $17,500 under the AABD asset limit. That leaves $79,328 above the limits.1

That excess doesn't automatically block the application. Illinois approves a long-term-care applicant with more nonexempt resources than the limit as spenddown (unless they decline in writing), but spenddown isn't free coverage: Medicaid doesn't pay medical expenses until the bills, paid or unpaid, equal or exceed the spenddown amount.5 In a nursing-home case like this one, the excess resources are added to his countable income, and before coverage for a month can begin, his medical expenses must equal that total, with nursing-home charges counted at the private rate.1,5

Moving the CSRA Into Her Name

Federal law lets the institutionalized spouse transfer assets up to the CSRA to the community spouse, or for her sole benefit, without a transfer penalty, and the transfer should happen as soon as practicable after he's first found eligible.4 After the month he's found eligible, none of her resources are counted as available to him while he stays in the facility.4

Illinois doesn't require the transfer, but it sets a deadline: the institutionalized spouse can move resources to the community spouse only until the first redetermination after his medical benefits are approved, and anything not transferred by then counts as available to him. Personal effects, household goods and one motor vehicle can also go to her for her sole benefit, whatever their value. If the couple jointly receives a resource after eligibility is set, half belongs to the community spouse and half is available to the institutionalized spouse.1

What Counts as a Countable Asset?

Start from the federal rule: at application, everything either spouse owns, alone or together, counts as available to the institutionalized spouse except the CSRA, whatever state law says about marital property.4 So list every account and property either of you holds before you apply, including:

• Checking and savings accounts
• CDs and money market funds
• Stocks, bonds, and mutual funds
• Retirement accounts such as IRAs and 401(k)s
• Real estate other than the home

DHS decides which of these Illinois excludes. The home, and the few items Illinois sets apart, are covered below.

How the CSMNA Works

Federal law builds the at-home spouse's income protection on a Minimum Monthly Maintenance Needs Allowance (MMMNA): her monthly income allowance is the amount by which that standard exceeds her own income, and it comes out of the institutionalized spouse's income only to the extent he actually makes it available to her.4 Illinois calls its version the Community Spouse Maintenance Needs Allowance (CSMNA). The 2026 standard is $4,066.50 a month, and the CSMNA is that standard minus the community spouse's gross income.1

That's the same as the 2026 federal maximum monthly maintenance needs allowance, and well above the $2,705.00 federal minimum (MMMNA) that applies from July 1, 2026 through June 30, 2027.2

Read the $4,066.50 standard as a protected income level, not a limit on what she may have. Her own income stays hers whatever the amount, and the standard is the level that part of the institutionalized spouse's income can lift her toward.1,2

DHS's chart also lists $2,705.00 as "Family Maintenance (FMNA)." That isn't a community-spouse figure. It's the Family Maintenance Needs Allowance, for dependent family members who live with the community spouse and are claimed by either spouse for taxes, such as a dependent child under 21 or a dependent parent or sibling of either spouse. It comes out of non-SSI income only.1

The Name-on-the-Check Rule

Under federal law, while the institutionalized spouse is in the facility, none of the community spouse's income is deemed available to him, and income paid solely in her name is counted as hers alone. However large a pension paid in her name, it stays hers. This is often called the "name on the check" rule (42 USC § 1396r-5(b)(2)).2

Only the institutionalized spouse's income flows toward the nursing facility cost, and even then, not all of it.1

Income Diversion

When the community spouse doesn't have enough income of her own, DHS deducts the CSMNA from the institutionalized spouse's income for her instead of sending it to the nursing facility. The deduction isn't allowed from SSI, and it counts only to the extent he actually contributes the income to her.1

How this works in practice: the institutionalized spouse keeps a personal needs allowance of up to $60/month in a skilled nursing facility (a resident on SSI doesn't reach it, because Social Security cuts SSI to $30/month on entry), and health insurance premiums such as Medicare premiums are exempt.1 The personal needs allowance comes off first, then the CSMNA, and the rest of his countable income is applied to the cost of care.1,5

Worked example #1 illustrating income diversion:

The figures below are hypothetical and shown only to illustrate how the calculation works. They are not a real case and not a prediction of your own result.

The community spouse has gross income of $1,400/month from Social Security, so her CSMNA is $2,666.50: the $4,066.50 standard minus her gross income. The institutionalized spouse receives $3,500/month. After his $60 personal needs allowance and his Medicare premium, up to $2,666.50 of the balance can be paid to her, and what's left goes to the nursing facility as his share of the cost.1

If he pays her the full amount, the community spouse goes from $1,400/month to $4,066.50/month, a meaningful difference in financial security.1

When $4,066.50 Isn't Enough

Illinois uses a greater amount when a court order or a fair hearing requires one.1 Under federal law, a fair hearing can substitute a higher amount if either spouse shows that the community spouse needs more income "due to exceptional circumstances resulting in significant financial duress," and a court order for his support of her sets the allowance at no less than the amount ordered.2,4

The Home

The primary residence is exempt from Medicaid eligibility calculations for the institutionalized spouse, up to Illinois's home-equity limit.1

For 2026, the home equity limit in Illinois is $752,000.1 That limit doesn't apply while a spouse, a child under 21, or a blind or permanently disabled child lawfully lives in the home, so while the community spouse lives there, it doesn't come into play.3

Illinois also applies a 60-month look-back to transfers of resources or income, measured from the request for the state to pay for long-term care, and a non-allowable transfer creates a penalty period for nursing-home, supportive-living and Department on Aging waiver services, though he keeps his other covered medical services if he's otherwise eligible.5 Deeding the home to a child within that window can trigger a penalty. One exception covers a son or daughter who lived in the home for at least two years before the parent entered care and whose care kept the parent at home, but whether the care qualified is Illinois's call, not the family's.3 If protecting the home from eventual estate recovery is a concern, talk to an Illinois elder law attorney before moving it.

Other Assets She Can Keep

Illinois sets apart two things beyond the CSRA itself:

• Primary residence (up to the $752,000 equity limit, which doesn't apply while the community spouse lives there)1,3
• Personal effects, household goods and one motor vehicle, which the institutionalized spouse can transfer to her for her sole benefit whatever their value, on top of the CSRA1

For anything else you hope to keep out of the count, such as a prepaid burial contract, a burial plot, or farm or business property, ask DHS how Illinois treats it before you plan around it.

Don't assume a retirement account is exempt. Ask DHS how it will count an IRA or 401(k) owned by either spouse before you plan around it.

Illinois Medicaid Spousal Impoverishment and the Application Process

Who Administers This

Illinois Medicaid for long-term care is administered by the Illinois Department of Healthcare and Family Services. Financial eligibility is determined by the Illinois Department of Human Services (DHS). The community spouse's CSRA and CSMNA are worked out as part of the nursing home Medicaid application.1

Getting Your Questions to DHS

DHS publishes a help line at 1-800-843-6154. Call it to ask how DHS will figure the CSRA and CSMNA in your case and which date it will use to count your assets.1

The Application Process

Illinois Medicaid applications for long-term care follow these general steps. For a detailed walkthrough, see the Illinois Medicaid how-to-apply guide.

Illinois Spousal Impoverishment and Spenddown

Income above Illinois's standard doesn't by itself bar the institutionalized spouse. A long-term-care applicant with more income than the income standard, or more nonexempt resources than the limit, is approved as spenddown unless they decline in writing. Spenddown isn't free coverage, though: Medicaid doesn't pay medical expenses until the bills, paid or unpaid, equal or exceed the monthly spenddown amount.5 For more on how income eligibility works, see Illinois Medicaid eligibility and income limits.

Medicaid Planning Strategies to Know

Illinois's CSRA and CSMNA give couples a solid baseline, but there are still cases where additional planning makes sense, particularly if countable assets significantly exceed the $143,172 CSRA standard. Options include:1

• Spending countable money on the exempt home, such as needed repairs. Federal law excuses a transfer when the State is satisfied it was meant to be at fair market value, so keep receipts, and get DHS to confirm Illinois will see it that way before you spend.1,3
• Medicaid-compliant annuities: under federal law, an annuity is treated as a transfer for less than fair market value unless the State is named as remainder beneficiary, either first (for at least what Medicaid paid on his behalf) or second after the community spouse or a minor or disabled child, moving to first if that person gives the remainder away for less than fair market value. It must also either be a retirement-type annuity or be irrevocable, nonassignable, actuarially sound, and pay in equal amounts with no deferral and no balloon payments. States can add their own conditions on top of the federal list, so check Illinois's rules with DHS before buying one.3
• Fair hearing: if the CSRA does not generate enough income to bring the community spouse to the maintenance needs allowance, a fair hearing can substitute a higher resource allowance. Illinois must first count all of the institutionalized spouse's available income as available to her, which narrows when this route pays off.2,4

For broader planning options, see Medicaid planning strategies.

Couples with significant assets above the CSRA standard should consult an Illinois-licensed elder law attorney before applying.

Where to Get Help in Illinois

Learn More

Find personalized help understanding Illinois Medicaid spousal impoverishment rules 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.