South Dakota Medicaid Income Limits 2026: Eligibility

For long-term care, the South Dakota Medicaid income limit is a hard cap: $2,982 a month in 2026, with no medical spend-down. South Dakota is an income-cap state, so an applicant over that ceiling routes the excess through a Miller Trust to qualify rather than whittling it down with medical bills.1

This guide covers the 2026 income and asset rules for South Dakota Medicaid long-term care: the income cap and how a Miller Trust clears it, the $2,000 asset limit, what a nursing-home resident keeps, and what the at-home spouse is protected from. It also separates the long-term-care rules a senior faces from the income-based Supplemental Security Income (SSI) test and the expansion path for working-age adults. South Dakota Medicaid is run by the state's social-services agency (DSS).

In This Guide

• South Dakota Medicaid in 2026: the numbers that matter
• Which income test applies: ABD long-term care vs. MAGI expansion
• The South Dakota Medicaid income limit for long-term care
• How the Miller Trust clears the cap
• What a nursing-home resident keeps
• Protecting the spouse who stays home
• After death: estate recovery
• How to apply when you are over the South Dakota Medicaid income limit
• Frequently Asked Questions
• Learn More

Which income test applies: ABD long-term care vs. MAGI expansion

South Dakota's Medicaid program uses two different income tests, and which one applies depends on who is asking. Online calculators often surface the wrong one, so start here.

• The long-term-care (ABD) test. A senior who is aged, blind, or disabled and needs nursing-facility or waiver care is judged under the Supplemental Security Income (SSI) related rules: the $2,982/month income cap and a hard $2,000 asset test for a single applicant. This is the test the rest of this guide explains.1,2
• The expansion (MAGI) test. South Dakota implemented Medicaid expansion on July 1, 2023, under voter-approved Constitutional Amendment D. Adults aged 19 to 64 with household income at or below 138% of the Federal Poverty Level, roughly $22,025/year (about $1,835/month) for one person in 2026, qualify with no asset test.4,5

The distinction matters because the asset test only bites on the long-term-care side. A working-age adult in the expansion group is measured on income alone, while a senior applying for nursing-home coverage must clear both the income cap and the $2,000 asset limit.1

The South Dakota Medicaid income limit for long-term care

For long-term-care Medicaid, South Dakota sets the income limit at $2,982 per month, equal to 300% of the 2026 SSI Federal Benefit Rate of $994.1,2 That figure applies to nursing-facility coverage and to the home-and-community-based services (HCBS) waivers that pay for care outside a facility.

Here is what makes South Dakota different from a spend-down state. The cap is counted on gross income, and it is a true ceiling. In a medically needy state, someone over the income standard can still qualify by incurring enough medical bills each month to spend down the excess. South Dakota does not offer that route for long-term care. A gross income even one dollar above the $2,982 cap puts you over the line, even though that income covers a fraction of a nursing-home bill.1

That sounds like a trap, and for years it was. The fix is a legal one, and South Dakota recognizes it.

How the Miller Trust clears the cap

A Qualified Income Trust, almost always called a Miller Trust, is the tool that lets an over-income applicant qualify anyway. You establish the trust, and each month the income above the cap is deposited into it. Income held in a properly drafted Miller Trust does not count toward the $2,982 limit, so the applicant is treated as income-eligible.1

The trust is not a loophole or a way to shelter money for heirs. It is tightly controlled:

• The money in the trust can only be spent in a set order, mostly toward the cost of the applicant's care and certain allowances.
• The state must be named as the remainder beneficiary, so whatever is left when the recipient dies goes to South Dakota Medicaid up to what it paid.
• It has to be set up correctly before or in the month coverage is needed, which is why this is elder-law-attorney territory, not a do-it-yourself form.

The practical takeaway: being over the income cap in South Dakota does not mean you are disqualified. It means you need a Miller Trust. A single dollar of excess income is a paperwork problem, not a dead end.

What a nursing-home resident keeps

When South Dakota Medicaid pays for nursing-facility care, the resident contributes nearly all of their monthly income toward the cost of care. What stays with them is the Personal Needs Allowance (PNA), money set aside for the resident's own small expenses like clothing, a haircut, or a phone. South Dakota sets its PNA at $100/month, plus up to the first $75 of gross earned income for a resident who works.1,3

That $100 is worth noticing. The federal floor has sat at $30/month since 1988, so South Dakota's $100 leaves a resident more breathing room than the federal minimum requires.1,3 (For the national picture on how the allowance works and where it gets deducted, see our explainer on the Medicaid personal needs allowance.)

The five-year look-back

South Dakota reviews asset transfers made in the 60 months before a long-term-care application.1,6 Giving away money or property for less than fair market value during that window, such as signing a house over to a child or gifting a grandchild a down payment, can trigger a penalty period during which Medicaid will not pay for long-term-care services, even when you otherwise qualify.6

There are legitimate exceptions, including transfers between spouses, transfers to a disabled child, and certain caregiver-child home transfers, along with legitimate planning approaches. Anything done inside the five-year window deserves an elder-law attorney's review first. If long-term care is on the horizon for someone in your family, talk to a professional before moving assets. For the broader toolkit, see our guide to Medicaid planning strategies.

Protecting the spouse who stays home

When one spouse needs long-term care and the other stays in the community, federal spousal-impoverishment rules keep the at-home spouse from being left with nothing. South Dakota applies the federal maximums for 2026.1

So a married couple stands in a very different position from a single applicant. The community spouse can hold up to $162,660 in countable assets and bring monthly income up to $4,066.50 while the other spouse receives Medicaid-funded care.1 The $2,000 asset limit applies to the spouse who needs care, not to the couple's whole net worth.1 The home is exempt while a spouse lives there, but for an unmarried applicant, home equity above the 2026 federal minimum of $752,000 is countable.7

After death: estate recovery

Like every state, South Dakota runs a Medicaid estate-recovery program. After a recipient who was 55 or older and received long-term-care services dies, the state may seek repayment from the estate, unless the recipient is survived by a spouse or a minor, blind, or disabled child. Federal exceptions apply, and an undue-hardship waiver exists.1,8 For how recovery works and where families have room to plan, see our Medicaid estate recovery explainer.

How to apply when you are over the South Dakota Medicaid income limit

South Dakota Medicaid is administered by the state DSS. You have two main ways to apply, and a level-of-care screening confirms long-term-care applicants need nursing-facility-level services.

Where to get help

Learn More

Find personalized help working through South Dakota Medicaid eligibility and the Miller Trust question for your family 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.