Indiana Medicaid Spousal Impoverishment 2026: CSRA & Income

Indiana Medicaid spousal impoverishment rules protect the spouse who stays home when the other enters a nursing home or long-term care waiver on Medicaid. Federal law sets the framework; the Indiana Family and Social Services Administration (FSSA) applies it. In 2026 the federal resource standards are $32,532 and $162,660, and the monthly income allowance standards run from $2,705.00 to $4,066.50; a fair hearing or court order can set either protection higher. This guide explains those protections, how Indiana's income-cap rules interact with them, and what to expect through the PathWays for Aging program.1,2

What Indiana Medicaid Spousal Impoverishment Covers

When one spouse applies for Indiana Medicaid long-term care, either in a nursing facility or through an HCBS waiver, federal spousal impoverishment law under 42 U.S.C. 1396r-5 protects the couple from being left with nothing. Indiana applies these protections through the FSSA Office of Medicaid Policy and Planning, with eligibility determinations made by the Division of Family Resources (DFR). Indiana states the protection covers nursing home care and in-home and community care under its Aged and Disabled Waiver, not only nursing home stays.1,2

Two separate protections apply, and they interact through the income-first rule described in the FAQ. The Community Spouse Resource Allowance (CSRA) covers assets. The Minimum Monthly Maintenance Needs Allowance (MMMNA) covers income. Together they define the financial floor the community spouse stands on while the institutionalized spouse receives Medicaid-funded care.

How the CSRA Works in Indiana

The CSRA is the asset-side protection. It determines how much of the couple's combined assets the at-home spouse can keep.

The calculation

1. Add up the couple's assets as of the snapshot date. Indiana counts bank account balances, cash on hand, stocks and bonds, and property other than the family home.2

2. Subtract exempt assets. Indiana excludes the home where a spouse lives, one vehicle, household furnishings and personal effects, irrevocable burial and funeral trusts, burial spaces, term life insurance, and real property in the community spouse's sole name.2

3. Apply the 50 percent rule. Indiana lets the community spouse keep a maximum of half of the couple's non-exempt assets.2

4. Apply the 2026 standards. Indiana publishes a minimum of $32,532 and a maximum of $162,660. If half falls below the minimum, the community spouse keeps the minimum. If half exceeds the maximum, the standard calculation stops at $162,660, though a fair hearing or a court order can protect more (see the FAQ below).1,2

The institutionalized spouse keeps $2,000 in countable assets. Everything above that and above the CSRA must be spent down before Indiana Medicaid activates.2

Worked example #1

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.

An Indiana couple has $180,000 in total countable assets on the snapshot date. Half is $90,000, which falls between the $32,532 minimum and the $162,660 maximum standard. The community spouse keeps $90,000. The institutionalized spouse spends down $88,000 (their half minus the $2,000 personal limit) before qualifying.1,2

Worked example #2

A couple has $40,000 in total countable assets. Half is $20,000, which is below the $32,532 minimum. The community spouse keeps the floor: $32,532. The remaining $7,468 is the institutionalized spouse's, minus $2,000, leaving about $5,468 to spend down.1,2

How the MMMNA Works in Indiana

The MMMNA is the income-side protection. It sets the minimum monthly income the community spouse is entitled to keep.

The minimum and the published maximum

The MMMNA minimum is $2,705.00 per month, effective July 1, 2026 through June 30, 2027. The federal maximum is $4,066.50 per month, which Indiana rounds to $4,067. That maximum is a standard, not an absolute cap: if either spouse shows at a fair hearing that the community spouse needs more income because of exceptional circumstances causing significant financial duress, the hearing can substitute a higher amount.1,2

High housing and living costs

The federal excess-shelter standard (the community spouse monthly housing allowance) is $811.50 per month from July 1, 2026. Indiana says a community spouse with high living expenses may appeal to keep more of the nursing home spouse's income, bringing their total monthly income up to $4,067. If your housing costs are high, keep records of them and ask DFR which expenses it counts.1,2

How the income transfer works

The community spouse keeps all income solely in their name, plus half of jointly owned income. If that comes to less than $2,705 a month, they may keep some of the nursing home spouse's income to reach that minimum. This monthly transfer is the community spouse monthly income allowance. Where a court has ordered support for the community spouse, the allowance can be no less than the amount ordered.2

Indiana's income-cap rule and Miller Trusts

Indiana is an income-cap state. The Special Income Level is $2,982 a month in 2026 (300 percent of the $994 SSI Federal Benefit Rate), and it counts only the applicant's income, not the spouse's. An applicant whose income is above it is not eligible for Indiana Medicaid long-term care unless they have a valid Miller trust (a qualified income trust), which Indiana names as the one route above the Special Income Level.2

If the institutionalized spouse needs a Miller trust, have an elder law attorney draft it, and ask before it is signed how the trust and the community spouse's income allowance will work together. This is a common area where families need guidance.

The Home and Other Exempt Assets

Indiana's long-term care exempt-resource list sets out the assets that do not count in the Medicaid eligibility calculation.

The home is exempt when a spouse, a child under 18, or a disabled or blind child lives there, or when the recipient is expected to return home. Indiana's $752,000 home equity limit does not apply while the spouse, a child under 21, or a blind or disabled child lawfully lives in the home. For most married couples, the home does not affect eligibility.2

Other common exemptions:

• One vehicle of any value if it is used for the community spouse, for employment or medical treatment, or is modified for a disability (otherwise $5,000 of its market value is excluded)
• Household furnishings and personal effects (collections are not excluded)
• Irrevocable burial and funeral trusts tied to specific services, and burial spaces
• Term life insurance, or cash-value life insurance with a face value of $10,000 or less payable to the estate or funeral home
• Income-producing property whose income is greater than the expenses of owning it
• Real property in the community spouse's sole name2

Retirement accounts (IRAs, 401(k)s, 403(b)s) need case-by-case review, so ask your local DFR office or an elder law attorney how Indiana will count them before you assume either way.

The Snapshot Date

Indiana takes the snapshot of the couple's assets at the start of the applicant's first continuous institutionalization lasting at least 30 days, in a nursing facility or a hospital. If your spouse is applying for waiver services at home instead, ask DFR how it will set the snapshot date in your case.2

The snapshot matters because the CSRA is calculated from asset values on that date, not from current values at the time of application. A couple who had a quarter-million dollars in assets when a spouse entered a nursing home in March, but spent tens of thousands on private-pay care by August, would still have the CSRA calculated on the March figure. Gathering bank and investment statements from the snapshot date early makes the application process considerably easier.

PathWays for Aging

Since July 1, 2024, Indiana has delivered Medicaid long-term services and supports for members 60 and older through PathWays for Aging, a managed care program run by three health plans: Anthem Blue Cross and Blue Shield, Humana Healthy Horizons, and UnitedHealthcare Community Plan of Indiana. It serves members living in a nursing or long-term care facility and members approved for the Aged and Disabled Waiver, but not every Medicaid member 60 and older: members on several other waivers, including the Traumatic Brain Injury Waiver, are not eligible.2

PathWays changes how long-term services are delivered, not who decides eligibility. DFR still establishes Medicaid eligibility, and Indiana applies its spousal impoverishment protections to nursing home care and to in-home and community care under the Aged and Disabled Waiver, which are where PathWays members receive long-term care. So the CSRA, the snapshot date and the income allowance described in this guide still apply.2

Applying for Indiana Medicaid Spousal Impoverishment Protections

Indiana Medicaid long-term care applications are filed through the FSSA Division of Family Resources. You can apply:

• Online through the FSSA Benefits Portal at fssabenefits.in.gov
• By phone at 1-800-403-0864 (also the line for checking application status)2
• By mail, or in person at your local DFR office (there is one in every county)

Nursing facilities often have social workers who assist with initial paperwork, but gathering financial documentation is the family's responsibility.

Documents to prepare:

• Bank and investment statements from the snapshot date forward
• Social Security award letters for both spouses
• Pension and retirement income documentation
• Deed and mortgage records for the home
• Vehicle title
• Documentation of prepaid burial arrangements
• Recent tax returns

DFR will review all submitted records and may request additional documentation. Indiana says a complete application can take up to 90 days to be decided.2

Indiana families applying for Medicaid long-term care should gather financial records early and contact the local DFR office to understand the specific documentation timeline. For complex cases, especially those involving high assets, Miller Trusts, or the PathWays managed care system, consulting an elder law attorney can prevent costly errors.

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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.