New Mexico 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 standard 2026 calculation lets the at-home spouse keep between $32,532 and $162,660 in countable assets, with a monthly income floor of $2,705.00 from July 1, 2026; a fair hearing or court order can set more.1 This guide explains how those protections work under New Mexico Medicaid, whose managed-care program has been Turquoise Care (formerly Centennial Care) since July 1, 2024.2

How New Mexico Medicaid Spousal Impoverishment Works

Medicaid counts the resources of both spouses when one applies for long-term care, so without special rules, getting one spouse covered could mean spending down nearly everything and leaving the healthy spouse at home with almost nothing. The federal spousal-impoverishment rules, codified at 42 U.S.C. 1396r-5 (Section 1924 of the Social Security Act), set aside a protected share instead, and New Mexico's own rule applies them.4 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 Medicaid is run by the New Mexico Health Care Authority (HCA), and its managed-care program has been Turquoise Care since July 1, 2024, when it replaced Centennial Care. HCA's Income Support Division makes the financial eligibility determination. The two protections are the Community Spouse Resource Allowance (CSRA) on assets and the Minimum Monthly Maintenance Needs Allowance (MMMNA) on income.2

These are long-term-care protections. New Mexico's rule applies them when one spouse is institutionalized for a continuous period of at least 30 consecutive days, with long-term care covered under the state's Institutional Care categories.2

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 start of the applicant spouse's continuous period of institutionalization. The community spouse keeps half of that amount (the spousal share), subject to a federal floor and ceiling.4 New Mexico uses the full federal standards: under the standard calculation the protected share is at least $32,532 and at most $162,660 in 2026. A fair hearing or a district court order can set a higher amount, and neither route has a dollar cap.1,2

• 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 standard ($162,660). If half the couple's assets exceeds this amount, the standard calculation caps the protected share here; only a fair hearing or a court order can set more. 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 under the standard calculation, 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 while it is the principal place of residence (the home-equity limit below does not apply while the community spouse lives there)
• One automobile, regardless of value, used for transportation for the applicant or a household member
• Household goods and personal effects, unless acquired or held for their value or as an investment
• A burial fund of up to $1,500 for the applicant and another $1,500 for the spouse, reduced by the face value of excluded life insurance and by assets in irrevocable burial arrangements2

Assets outside these exclusions generally count toward the snapshot, because Institutional Care applicants must meet all SSI eligibility criteria except income.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 Medicaid 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. New Mexico calls that allocation the community spouse monthly income allowance: the MMMNA minus the community spouse's total gross income, deducted only to the extent the income is actually contributed to the community spouse.1,2

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 exceed the federal excess-shelter standard, which is $811.50 a month from July 1, 2026, the excess is added to the base allowance, raising the MMMNA toward the $4,066.50 ceiling. Ask HCA's Income Support Division which housing and utility costs it counts.1

Requesting a higher allowance. If the community spouse needs more income than the MMMNA provides because of exceptional circumstances resulting in significant financial duress, either spouse can ask for an HCA administrative hearing, and a district court can also order a higher amount. New Mexico counts medical, remedial, or other support expenses that threaten the community spouse's ability to stay self-sufficient, and an increase granted for a set period ends when that period does.2,1 Bring itemized proof of those costs. 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. As of January 1, 2026, countable income for Institutional Care Medicaid must be at or below $2,982 a month, the federal 300% cap (three times the $994 SSI benefit rate). That higher limit applies once the applicant has been institutionalized for 30 consecutive days.2

An applicant whose income is over that limit may still qualify by creating and funding a qualified income trust, which New Mexico calls an Income Diversion Trust (commonly known as a Miller Trust). Trusts executed on or after August 11, 1993 no longer have to be court ordered or approved.2 An elder-law attorney can draft the trust.

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 $100 per month, which the resident may keep for personal expenses; federal rules bar a state from setting that allowance below $30 a month.2 While the applicant is in the institution, federal law deems none of the community spouse's income available to the applicant: income paid solely in the community spouse's name belongs to that spouse alone, and income paid in both names is generally split half to each.1

The Home Exemption and Equity Limit

The primary home is not a countable resource while it is the principal place of residence.2 For 2026 the federal home-equity limit is a minimum of $752,000 unless the state elects a higher amount, up to $1,130,000. That limit does not apply at all while the applicant's spouse, a child under 21, or a blind or disabled child lawfully lives in the home, so home equity cannot disqualify the applicant while the community spouse lives there.3 One vehicle, personal effects, and certain burial funds are also excluded.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. Recovery waits until after the surviving spouse dies, and while the recipient has a surviving child who is under 21, blind, or disabled. That is a postponement, not a cancellation: the claim against the recipient's estate can still be pursued later. New Mexico recovers only from property subject to probate under the New Mexico Uniform Probate Code, and heirs are never personally liable.5 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 transfers made on or after February 8, 2006.2 Gifts or below-market-value transfers within the 60 months before the application can trigger a penalty period during which Medicaid will not pay for long-term care.3 Transfers to a spouse are exempt from that penalty, so assets can be retitled into the community spouse's name without one.6 Retitling does not shrink the calculation, though, because at application the resources held by either spouse or both are counted together.4

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.