Montana Medicaid Personal Needs Allowance (2026): What You Keep

In 2026, $50 a month is what most Montana Medicaid nursing facility residents keep as a Personal Needs Allowance, while most of the rest of their income goes toward the cost of care. That protected slice is the Montana Medicaid Personal Needs Allowance, the money the state sets aside for the small things Medicaid and the nursing home don't cover, like clothing, a haircut, phone service, or a birthday gift for a grandchild.1,2

In This Guide

• What Is the Montana Medicaid Personal Needs Allowance?
• How the Montana Medicaid Personal Needs Allowance Compares to the Federal Floor
• How Your Money Is Held: The Resident Trust Fund
• Where the Allowance Fits in Your Patient Liability
• What the Facility Must Provide Without Touching Your Allowance
• If You're a Veteran: The VA Pension Rule
• Frequently Asked Questions
• Learn More

What Is the Montana Medicaid Personal Needs Allowance?

When someone qualifies for Medicaid long-term care and moves into a nursing facility, they don't pay rent or a room-and-board bill the way they would at an assisted living community. Instead, Montana Medicaid, run by the Montana Department of Public Health and Human Services (DPHHS), pays the facility directly, and nearly all of the resident's own monthly income, Social Security, a pension, an annuity, gets counted toward that bill.

The Personal Needs Allowance (PNA) is the exception. It's the piece of income the state protects so the resident isn't left with nothing of their own. In Montana, that allowance is $50 a month for a nursing facility resident. A resident whose only income is Supplemental Security Income (SSI) keeps a smaller allowance of $30 a month.1

Fifty dollars isn't much, and it isn't meant to cover the cost of care. It's meant to cover the personal things a nursing home and Medicaid don't: replacement clothing, a haircut or a perm, snacks and treats, a phone or a streaming subscription, postage and greeting cards, a small gift for a family member. The point is dignity and choice, that a resident has a little money that is genuinely theirs to spend as they wish.

Everyone in a Medicaid-funded nursing facility bed gets a Personal Needs Allowance; it isn't something you apply for separately. Once Medicaid is paying for the facility stay, the allowance is built into how your monthly income is divided: federal rules require the state to deduct it from the resident's income when it figures what goes toward the cost of care.2

How the Montana Medicaid Personal Needs Allowance Compares to the Federal Floor

Every state's Personal Needs Allowance rests on a federal minimum. Under federal Medicaid law, the institutional allowance must be at least $30 a month for an individual, and at least $60 a month for an institutionalized couple when both spouses are aged, blind, or disabled and their incomes are counted as available to each other. Those floors were added to federal Medicaid law by the Omnibus Budget Reconciliation Act of 1987, effective for calendar quarters beginning on or after July 1, 1988, and have never been raised since, so a dollar of allowance today buys far less than it did when the floor was set.2

The federal amounts are a floor, not a ceiling. A state must set its nursing facility allowance at or above that $30 and is free to set it higher, as Tennessee does at $70.2

Montana is one of the states that went higher, though not by a wide margin. At $50 a month, the Montana Medicaid Personal Needs Allowance is $20 above the federal individual floor, and $20 below the $70 Tennessee protects.1,2

Here's the practical takeaway: the $50 figure is what governs in Montana, and it's the amount Montana protects for a nursing home resident. The federal floor matters mostly as context: it tells you the state can't go lower than $30.1,2

How Your Money Is Held: The Resident Trust Fund

The $50 doesn't just vanish into a general account or come to the resident as loose cash. Under federal nursing-facility rules, the resident has the right to manage their own money, and the facility can't force anyone to hand their funds over. Many residents, or the family member helping them, choose to deposit the allowance with the facility instead. Once the resident authorizes that in writing, the facility has to act as a fiduciary, legally bound to safeguard the money and account for it.3

That account is usually called a resident trust fund. The rules that govern it are worth knowing, because they're what protect the resident's money:

• Any balance over $50 for a Medicaid resident has to sit in an interest-bearing account held for the resident, separate from the facility's own operating money. (The threshold is $100 for a resident who isn't on Medicaid.)3
• The facility has to keep a full, separate accounting of the resident's funds, with no mixing of resident money and facility money.3
• The resident (or their representative) is entitled to a quarterly statement, and can ask to see the individual financial record at any time.3
• The facility has to secure all resident funds with a surety bond or another assurance the federal government accepts.3
• When a resident is discharged, evicted, or dies, the facility has 30 days to convey the funds and a final accounting: to the resident, or after a death to the person or probate court administering the estate, under state law.3

A word of practical advice: don't wait for the statement to show up on its own. Facilities are required to provide it, but families who ask for the quarterly statement in writing, and reconcile it against what they know the resident actually spent, are the ones who catch a bookkeeping error or a wrong charge early. Keep those statements. If your loved one is discharged or passes away, the final accounting is something you'll want in hand.

There's one more thing to watch. The facility must tell a Medicaid resident when the account reaches $200 less than the SSI resource limit for one person, because if the account plus the resident's other nonexempt resources reaches that limit, the resident may lose Medicaid or SSI eligibility.3 Montana's own countable-resource limit for a single nursing home resident is $2,000, so if the allowance is allowed to pile up month after month without being spent, the balance can drift toward that limit and put eligibility at risk.1 The fix is simple: spend the allowance on the resident, month to month, rather than letting it accumulate.

Where the Allowance Fits in Your Patient Liability

To see where the $50 comes from, it helps to understand what happens to the rest of a resident's income.1 When Medicaid pays for a nursing home stay, the resident is expected to contribute most of their monthly income toward the cost of that care. The amount they contribute is called the patient liability (you may also hear it called the share of cost or the cost-of-care contribution).

Montana calculates the patient liability by starting with the resident's gross monthly income and then subtracting a set of allowable deductions.1 The order looks roughly like this:

1. Start with gross monthly income, Social Security, pension, annuity, and similar.
2. Subtract the Personal Needs Allowance of $50 (or $30 for an SSI-only resident). This is the money the resident keeps.1
3. Subtract a monthly income allowance for a spouse who still lives in the community, if there is one, so the at-home spouse isn't left destitute. Montana's manual tops the at-home spouse's own income up to a $2,705 basic needs standard (effective July 1, 2026) plus any shelter costs above an $811.50 basic shelter allowance, but never past $4,067 (effective January 1, 2026), and only if the money is actually transferred to that spouse.1 The federal figures for the same standards are $2,705.00 and $4,066.50, and a fair hearing can allow more where exceptional circumstances leave the at-home spouse in significant financial duress.5 Federal rules also provide a maintenance allowance when other family members live at home.2
4. Subtract medical costs no one else pays, such as a Medicare Part B premium, other health-insurance premiums, deductibles and coinsurance.2
5. What's left is the patient liability, and it's paid to the facility each month as the resident's contribution.

Notice where the allowance sits: it comes out near the top, before the patient liability is figured, which is why the resident actually keeps it.1 The $50 isn't a payment the facility makes to the resident; it's income the resident was already receiving that the state simply refuses to count toward the bill. Everything above the protected amounts flows to the nursing home, and Medicaid covers the gap between that contribution and the full cost of care.

For a resident with a spouse at home, this math can shift a good deal of income to the community spouse, which lowers the patient liability but doesn't change the $50 the institutionalized resident keeps for personal needs. The allowance is fixed; it's the other deductions that vary with the household.1

What the Facility Must Provide Without Touching Your Allowance

One of the most useful things to understand about the Personal Needs Allowance is what it is not for. A common and costly misunderstanding is that the $50 has to stretch to cover routine care items the facility should be providing for free. It doesn't.1

Under federal nursing-facility rules, seven categories of items and services are already included in the daily rate Medicaid pays the facility, and during a covered stay the facility must not bill the resident for them or charge them against the Personal Needs Allowance. That covered list includes:6

• Nursing services
• Food and nutrition services
• An activities program
• Room and bed maintenance
• Routine personal hygiene items and services, such as a comb and brush, bath soap, a razor and shaving cream, a toothbrush, toothpaste, denture adhesive and cleaner, moisturizing lotion, towels and washcloths, incontinence care and supplies, over-the-counter drugs, bathing assistance, and basic personal laundry, along with hair and nail hygiene services
• Medically related social services
• Hospice services the resident has elected, paid under the Medicare hospice benefit or by Medicaid

Federal rules bar the facility from charging a resident's personal funds for anything Medicaid or Medicare pays for, apart from applicable deductibles and coinsurance, so none of those can come out of the $50.6

So what is the allowance for? The extras, the things beyond that basic level. A preferred brand of shampoo or lotion, a trip to a salon for a color or a perm, snacks and outings, magazines and books, a phone or cable or streaming service, postage, hobby supplies, gifts for grandchildren. Even for extras like those, the facility can charge the resident's funds only if the resident asked for the item, it isn't needed to meet the goals in the care plan, the facility said there would be a charge, and Medicare or Medicaid isn't paying for it.6 If a facility ever tries to deduct the cost of a basic hygiene item or a covered service from a resident's trust fund, that's worth questioning; the facility's federal covered-items list is the reason.

If you're not sure whether a charge is legitimate, ask the facility to point to where the item falls outside the covered daily rate, and keep the answer with your trust-fund statements.

If You're a Veteran: The VA Pension Rule

Veterans and their families have one more rule to know, and it's a widely misdescribed one. A veteran who receives a VA pension from the U.S. Department of Veterans Affairs (VA), and who has neither a spouse nor a dependent child, faces a special limit once Medicaid is paying for their nursing facility care.

Under federal law, for a single, childless veteran covered by Medicaid for nursing facility services, no VA pension above $90 a month may be paid for any period after the month of admission. The same cap covers a surviving spouse with no child and a surviving child on pension. VA's own regulation counts from the month Medicaid payments begin instead, so if Medicaid approval comes after admission, confirm with the VA which month the reduction starts rather than working out a figure for the months in between. If the VA keeps paying more than $90 because it didn't make the reduction, the veteran doesn't owe the excess back unless they willfully concealed information the VA needed to reduce it.4

How far that limit reaches is a large part of what gets misdescribed. A state veterans home for which the VA makes per diem payments for nursing home care is not one of the facilities the $90 cap covers, so a single, childless veteran on Medicaid in that kind of home is not limited to $90 by federal law.4 If the resident is in a veterans home rather than a community nursing facility, ask the home whether the VA pays it a per diem for nursing home care before anyone treats $90 as the number.

There is a protection attached, though it's narrower than families are usually told. Federal law bars the facility's Medicaid payment from being reduced by the retained pension, so the state can't recover that $90 through what it pays the nursing facility.4 That rule governs the facility's payment. It says nothing about the state's Personal Needs Allowance, and whether the $90 is kept on top of that allowance or takes its place is decided by state Medicaid rules, which land on opposite answers in different states.4 Montana's answer isn't something to assume in either direction, so ask a Montana Medicaid eligibility caseworker how the pension is being counted and check the patient-liability figure on the notice.

Two cautions here. First, this $90 rule is a federal VA rule with its own source, and the state Personal Needs Allowance is a separate Medicaid rule; each protects money for its own reason. Treat them as two distinct protections rather than assuming a single guaranteed total. Second, the $90 cap applies to a veteran with no spouse and no dependent child (and to a surviving spouse with no child, or a surviving child); a married veteran, or one with a dependent, is in a different situation, and the type of VA benefit matters too. If a veteran in the family is entering a nursing facility on Medicaid, it's worth confirming the specifics with both a VA pension representative and a Montana Medicaid eligibility caseworker before counting on any particular figure.4

Learn More

Find personalized help understanding the Montana Medicaid Personal Needs Allowance and nursing home costs 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.