NM Medicaid Spousal Impoverishment 2026: What a Spouse Keeps

When one spouse needs Medicaid long-term care and the other stays home, New Mexico does not require the couple to go broke first. Under the federal spousal-impoverishment rules, the at-home spouse in 2026 can keep between $32,532 and $162,660 in countable assets and a guaranteed monthly income floor of $2,705.00. This guide explains how those two protections work under New Mexico Medicaid, known as Centennial Care.1

How New Mexico Medicaid Spousal Impoverishment Works

When Medicaid long-term care took shape decades ago, married couples faced a harsh problem: to get one spouse covered, they often had to spend down nearly everything, leaving the healthy spouse at home with almost nothing. Congress fixed that in 1988 with the spousal-impoverishment rules, codified at 42 U.S.C. 1396r-5 (Section 1924 of the Social Security Act), and New Mexico applies them in full. When one spouse (the "institutionalized" or applicant spouse) needs Medicaid long-term care, the other (the "community" spouse who stays home) may keep a protected share of the couple's assets and income.1

New Mexico administers these rules through its Centennial Care program, run by the New Mexico Health Care Authority (HCA), formerly the Human Services Department. HCA's Income Support Division performs the financial eligibility review. The two protections are the Community Spouse Resource Allowance (CSRA) on assets and the Minimum Monthly Maintenance Needs Allowance (MMMNA) on income.2

These protections apply specifically to long-term care through Centennial Care's Institutional Care categories or a home and community-based services waiver. They do not apply to regular, non-long-term-care Medicaid coverage.

The New Mexico CSRA: How Much Can the Community Spouse Keep?

The Community Spouse Resource Allowance determines how much of the couple's combined countable assets the at-home spouse may keep.

Calculating the CSRA. HCA takes a snapshot of the couple's total countable assets as of the date the applicant spouse began a continuous period of institutionalization or long-term care. The community spouse keeps half of that amount, subject to a federal floor and ceiling. New Mexico applies the full federal range: the protected share is never less than $32,532 and never more than $162,660 in 2026.1

• Minimum CSRA ($32,532). Even if half the couple's assets falls below this figure, the at-home spouse keeps at least $32,532.1
• Maximum CSRA ($162,660). Even if half the couple's assets exceeds this amount, the protected share is capped here. New Mexico's own eligibility materials describe this as protecting an amount up to $162,660 of the couple's resources for the non-institutionalized spouse.2

In practice: a couple with $60,000 in countable assets leaves the community spouse $30,000 (half). A couple with $22,000 leaves the community spouse the full $22,000, because the minimum applies. A couple with $400,000 leaves the community spouse $162,660, because the maximum caps the share.1

Countable vs. exempt assets. Not everything the couple owns counts toward the snapshot. Exempt assets include:

• The primary home, as long as the community spouse lives there (subject to the home-equity limit below)
• One vehicle used for household transportation
• Household goods and personal belongings
• A burial fund up to $1,500 and certain irrevocable funeral arrangements2

Most financial accounts, second properties, and retirement accounts count toward the snapshot.2

The applicant spouse's share. After the community spouse's CSRA is set aside, the applicant must spend their remaining countable assets down to New Mexico's $2,000 individual resource limit before Centennial Care will pay for care.2

Income Protection: The MMMNA in New Mexico

The MMMNA is the income counterpart to the CSRA. It sets the minimum monthly income the at-home spouse is entitled to keep, so the couple's income is not entirely consumed by the cost of the applicant spouse's care.

How the MMMNA range works. The federal MMMNA floor is $2,705.00 per month (effective July 1, 2026 through June 30, 2027; the floor resets each July). The ceiling is $4,066.50 per month, effective January 1, 2026. New Mexico follows these federal figures directly.1

If the community spouse already has income at or above the floor from their own sources (Social Security, a pension, or investments), no income is diverted from the Medicaid recipient. If the community spouse's own income falls short, they receive a monthly allocation from the applicant spouse's income to bring them up to the MMMNA.1

The excess-shelter adjustment. A community spouse whose shelter costs are high can qualify for an MMMNA above the floor. When the at-home spouse's shelter costs (rent or mortgage principal and interest, property taxes, homeowner's insurance, and a utility allowance) exceed a federal shelter standard, the excess is added to the base allowance, raising the MMMNA toward the $4,066.50 ceiling. Because the shelter standard itself is a federal figure that resets periodically, confirm the current amount with HCA's Income Support Division before relying on a specific number.1

Requesting a higher allowance. If the standard calculation does not adequately cover the community spouse's living expenses, or if exceptional circumstances create unavoidable costs, New Mexico provides a fair hearing process to raise the allowance. Presenting itemized monthly expenses (rent or mortgage statements, utility bills, property-tax records) is the most effective way to support a higher MMMNA. An elder-law attorney can help build that case.

New Mexico's Income Cap and the Income Diversion (Miller) Trust

New Mexico is an income-cap state. Unlike states that use a medically needy spend-down, New Mexico imposes a hard income cap on long-term-care Medicaid: a single applicant must have monthly income at or below $2,982 in 2026 (300% of the federal SSI benefit rate). An applicant whose gross monthly income exceeds that cap cannot qualify through a spend-down.2

Instead, the applicant must establish and fund a Qualified Income Trust, which New Mexico calls an Income Diversion Trust (commonly known as a Miller Trust). Each month, income above the $2,982 cap is deposited into the trust and is no longer counted for eligibility. The trust funds are then applied toward the cost of care, after allowances (including any income diverted to the community spouse) are deducted. The trust document must be properly drafted and executed before the application can be approved; an elder-law attorney handles the drafting.2

In a nursing facility, the resident's income above allowances is applied toward the monthly care bill, and Medicaid pays the remainder. New Mexico's nursing-facility Personal Needs Allowance is $97 per month, which the resident keeps for personal expenses. The community spouse's own income is never counted against the applicant's income cap.2

The Home Exemption and Equity Limit

The primary home is exempt while the community spouse lives in it and the equity is below the home-equity limit. New Mexico applies the federal-minimum home-equity limit of $752,000 for 2026. That cap does not apply at all while a community spouse or dependent child lives in the home, so the home is fully protected during the community spouse's lifetime.3 One vehicle, personal belongings, and certain burial funds are also exempt.2

New Mexico Estate Recovery After Death

After the applicant spouse passes away, New Mexico's Medicaid Estate Recovery Program may seek repayment for the cost of long-term care from the estate of a recipient who was age 55 or older. Federal law prevents any recovery while the community spouse is alive, and no recovery runs against the community spouse's own estate during their lifetime, because the community spouse was never the Medicaid recipient. New Mexico recovers only from property subject to probate under the New Mexico Uniform Probate Code, and heirs are never personally liable.4 For how New Mexico defines the recoverable estate and its exceptions, see our New Mexico Medicaid estate recovery guide.

The Look-Back Period

New Mexico applies a 60-month (five-year) look-back to uncompensated asset transfers when determining long-term-care eligibility. Gifts or below-market-value transfers within five years of the application date can trigger a penalty period during which Medicaid will not pay for care. Transfers between spouses are exempt, so assets can be retitled into the community spouse's name without penalty, but the snapshot valuation still counts all couple assets regardless of titling.2

How to Apply for New Mexico Long-Term Care Medicaid

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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.