Tennessee Personal Needs Allowance (PNA) (2026)

A Tennessee nursing-home resident on TennCare keeps a Personal Needs Allowance (PNA) of $70/month, raised from $50 effective January 1, 2025. Almost all of their remaining income goes to the facility, but this small PNA is theirs for things Medicaid does not cover. The $70 figure was set by Public Chapter 986 of 2024, codified at TCA § 71-5-147.1 The federal floor under 42 USC § 1396a(q) has been $30 since 1988.1 Tennessee's PNA framework also includes a uniquely high $2,982/month Community PNA for HCBS waiver participants in CHOICES Groups 2 and 3 and ECF CHOICES Groups 4-8, set at 300 percent of the SSI Federal Benefit Rate.2 This guide covers what the PNA is, who gets which amount across CHOICES, ECF CHOICES, the legacy 1915(c) DD waivers, and Tennessee State Veterans Homes; how the Resident Trust Fund works; how VA pension interacts with the PNA at a community facility and at a Tennessee State Veterans Home; and how Tennessee's $70 compares to the federal floor.

In This Guide

• The 60-Second Version
• What Is a Personal Needs Allowance?
• 2026 Tennessee PNA Numbers, All Settings
• The 2024 PNA Increase and the Statute-Versus-Rule Lag
• The Resident Trust Fund: How Your Money Is Held in Tennessee
• Allowable and Prohibited Spending
• Group 1 (Nursing Facility), Patient Liability Math, Step by Step
• Group 2 and Group 3 (HCBS), The Community PNA
• ECF CHOICES, I/DD Waiver Groups 4–8
• The Legacy 1915(c) DD Waivers: Statewide, CAC, and Self-Determination
• Veteran-Specific: The VA Cap, the Stacked Allowance, and Tennessee State Veterans Homes
• Working Residents, The Sheltered Workshop Disregard
• When PNA Balance Approaches the Asset Limit
• Death of a Resident, Where the Money Goes
• Power of Attorney, Conservatorship, and Resident Representative Rules
• Cross-State PNA Comparison (2026)
• The Federal Floor and the PNA Modernization Act
• Tennessee PNA History 1988–2026
• Worked Example: HCBS Group 2 Member at Home
• Where to Get Help When PNA Is Mishandled
• Pending Policy Watch
• 12 Tennessee-Specific PNA Pitfalls
• Related Reading

The 60-Second Version

If your loved one receives Tennessee Medicaid (TennCare) long-term services and supports:

1. Nursing facility residents keep $70 per month as their Personal Needs Allowance, raised from $50 effective January 1, 2025 under Public Chapter 986 of 2024 and TCA § 71-5-147.1
2. HCBS waiver participants in CHOICES Groups 2 and 3 keep up to $2,982/month (300% of SSI FBR) as a "Community PNA" for rent, food, utilities, and personal needs at home, they typically owe little or no patient liability.4
3. ECF CHOICES participants in Groups 4–8 (I/DD HCBS) use the same $2,982/month structure.2
4. Legacy 1915(c) DD waiver participants (Statewide, Comprehensive Aggregate Cap, and Self-Determination) receive HCBS, and TennCare's post-eligibility policy subtracts 300% of the SSI Federal Benefit Rate from the total income of an individual receiving HCBS, PACE, or Self-Determination ID Waiver services.4
5. The Resident Trust Fund at the facility is governed by federal 42 CFR § 483.10(f)(10), Tennessee TCA § 68-11-906, and Tenn. Comp. R. & Regs. 0720-18-.04.
6. A veteran on VA pension who has neither a spouse nor a child is subject to the federal $90/month cap under 38 USC § 5503(d)(2) once Medicaid covers their nursing-facility services. TennCare leaves that $90-limited pension out of total income, so the $70 PNA is deducted from the resident's other income instead, and someone with at least $70/month besides the pension keeps $160. Do not carry the arithmetic over to a married veteran, one with a child, an HCBS participant, or a state-veterans-home resident.1,3
7. Tennessee State Veterans Homes (TSVH) work differently: TSVH is run by the Tennessee State Veterans Home Board and is independent of the U.S. Department of Veterans Affairs. A TSVH stay is paid for first through VA per diem, with Tennessee Medicaid only one of several fallback payers, so do not assume the community-nursing-facility math carries over. Ask before placement and get the answer in writing.5
8. The Tennessee $70 PNA sits well above the $30 federal floor, which has not moved since 1988. It is a substantial raise over the prior $50 figure.1
9. The administrative rule lags the statute: Tenn. Comp. R. & Regs. 1200-13-01-.08(1)(a) still codifies $50 as of its April 2023 revision. The controlling authority is TCA § 71-5-147 at $70. Eligibility counselors at DHS may quote $50 from outdated paperwork, push back and cite the statute.1

What Is a Tennessee Personal Needs Allowance?

When an individual receives Medicaid-funded nursing facility (NF) or institutional care, they don't pay rent or board out of pocket, Medicaid pays the facility directly through a combination of federal match, state share, and the resident's own income (their Patient Liability, sometimes called share-of-cost).4

Federal law requires that the resident retain a small portion of their income each month for personal expenses, clothing, toiletries beyond what the facility provides, telephone, hair care, snacks, magazines, transportation for outings. This protected amount is the Personal Needs Allowance, and it's deducted from the resident's gross income before the patient liability is calculated.

Without a PNA, a resident's entire SSI/Social Security/pension check would flow to the facility, leaving them with nothing for personal dignity, choice, or quality of life.

The PNA is mandatory under 42 USC § 1396a(q) and 42 CFR § 435.725(c)(1). The federal floor is $30 per month for an institutionalized individual who is aged, blind, or disabled, and $60 per month for an institutionalized couple when both spouses are aged, blind, or disabled and their income is considered available to each other. Both figures have stood since the Omnibus Budget Reconciliation Act of 1987 (P.L. 100-203, effective July 1, 1988), never indexed for inflation and never raised by Congress in nearly 40 years.1

States may set their PNA above the federal floor. Tennessee's $70/month is well above the $30 federal minimum.1

For the federal framework (the $30 floor, OBRA-87 history, the complete state-by-state table, the post-eligibility deduction order, and the pending PNA Modernization Act), see Brevy's Medicaid Personal Needs Allowance Explained federal hub.1

2026 Tennessee Personal Needs Allowance Numbers, All Settings

The 2024 PNA Increase and the Statute-Versus-Rule Lag

Tennessee's PNA had been frozen at $50/month for nursing facility residents for roughly two decades. Advocates, including the Tennessee Justice Center, AARP Tennessee, Tennessee Health Care Association, and the Tennessee Long-Term Care Ombudsman, pressed the General Assembly to raise the figure to keep pace with the cost of personal items.1

Public Chapter 986 of 2024 amended TCA § 71-5-147 to raise the PNA from $50 to $70, and the increase took effect January 1, 2025.1

The statute is codified at TCA § 71-5-147, which now reads in pertinent part:

"In determining the amount of an eligible individual's income available for the cost of long-term nursing home care authorized under this part on or after January 1, 2025, a deduction shall be made from the person's total income in the amount of seventy dollars ($70.00) per month to be treated as a personal needs allowance within the meaning of applicable federal regulations."1

The rule lag

Here's where Tennessee gets tricky. The TennCare administrative rule at Tenn. Comp. R. & Regs. 1200-13-01-.08(1)(a) still reads, as of its last revision in April 2023:

"The personal needs allowance for nursing facility residents shall be fifty dollars ($50.00) per month."1

The rule has not been amended to reflect Public Chapter 986. Under Tennessee law, when a statute conflicts with an administrative rule, the statute controls (TCA § 4-5-203). But families and even DHS/TennCare eligibility counselors sometimes still quote the rule's $50 figure from older training materials. The controlling figure is $70, and the TennCare ABD Manual (Post-Eligibility policy, revised October 1, 2025) applies $70.1

What to do if you're told $50: Cite TCA § 71-5-147 directly. If the issue persists, escalate to TennCare Member Services (1-800-878-3192) or file a complaint with the Tennessee Long-Term Care Ombudsman (1-877-236-0013).1

Practical implication for facilities: Tennessee NFs should have updated their resident trust fund accounting and patient-liability calculations effective January 1, 2025. If your loved one's facility still credits only $50 to their resident trust fund, that's a billing error, and the facility owes the difference retroactively.1

The Resident Trust Fund: How Your Money Is Held in Tennessee

When a Tennessee Medicaid resident keeps their $70 PNA, the facility must administer those funds in compliance with federal law (42 CFR § 483.10(f)(10)), Tennessee statute (TCA § 68-11-906), and Tennessee licensing rules (Tenn. Comp. R. & Regs. 0720-18-.04 for nursing homes; 0720-22-.04 for HFC; corresponding rules for ICF/IID).1

Federal requirements (42 CFR § 483.10(f)(10))

The facility:

• May not require residents to deposit personal funds with the facility, but must hold and safeguard them if requested in writing.
• For Medicaid residents, balances above the regulatory threshold must be held in a separate interest-bearing account.
• Pooled trust accounts are permitted but must include separate accounting for each resident.
• Must provide quarterly statements showing all deposits, withdrawals, and the running balance.
• Must notify the resident when their balance approaches the resource limit ($2,000 in Tennessee for ABD/LTC).2
• Must convey funds and a final accounting to the resident's estate within 30 days of death or to the resident within 30 days of discharge.
• Must purchase a surety bond sufficient to recover all resident funds if the facility were to default.

Tennessee-specific requirements (TCA § 68-11-906 and Tenn. Comp. R. & Regs. 0720-18-.04)

Tennessee's resident-funds statute reinforces the federal safeguards. Any single-resident deposit above the statutory threshold under TCA § 68-11-906 must be placed in a separate interest-bearing account, and quarterly written accounting must be provided to the resident or representative without charge and reconcile against the facility's general ledger.

Tenn. Comp. R. & Regs. 0720-18-.04 (nursing homes) and 0720-22-.04 (residential homes for the aged / homes for the aged), both promulgated by the Tennessee Health Facilities Commission (HFC) following the 2022 transfer of licensing authority from the Department of Health, require:

• A separate identifiable record for each resident's personal funds.
• Reconciliation against bank statements at least monthly.
• A surety bond or self-insurance arrangement sufficient to cover the maximum aggregate trust balance.
• Immediate notification to the HFC (Tennessee Health Facilities Commission) and the Long-Term Care Ombudsman of any suspected misappropriation.
• Independent audit of resident trust funds.

Reporting suspected mishandling

If you suspect a Tennessee facility has mishandled, commingled, or stolen resident PNA funds:

1. Tennessee Health Facilities Commission (HFC), Complaint Line: 1-877-287-0010. Online: hfc.tn.gov/complaints.
2. Tennessee Long-Term Care Ombudsman, 1-877-236-0013 (statewide hotline operated through the Tennessee Commission on Aging and Disability, TCAD).
3. TennCare Office of Program Integrity, 1-800-433-3982 (for Medicaid-billing fraud overlap).
4. Adult Protective Services (APS), 1-888-277-8366 (24-hour reporting line).
5. Tennessee Bureau of Investigation Medicaid Fraud Control Unit (MFCU), for criminal-grade misappropriation. tbi.tn.gov.
6. Consider involving the county district attorney for theft prosecution (TCA § 39-14-103).

The HFC has authority under TCA § 68-11-207 to issue civil monetary penalties for resident-fund mishandling.

Allowable and Prohibited Spending

The PNA is the resident's money. Federal regulations (42 CFR § 483.10(g)(8)) and Tennessee licensing rules sharply limit what facilities can charge against the PNA.

Allowable (resident chooses):

• Clothing and shoes beyond what the facility issues
• Personal toiletries, cosmetics, hair products beyond what the facility provides
• Telephone, long distance, cell phone bills, plan upgrades
• TV streaming services, magazines, books, hobbies
• Snacks, soft drinks, treats from the facility canteen
• Hair salon, manicures (when not part of the facility's standard service)
• Outings, transportation, entertainment outside the facility
• Gifts for family, donations, religious offerings
• Personal medical care items not covered by Medicaid (e.g., elective dental over Medicaid coverage limits)
• Burial pre-payment (within Tennessee's burial-space and irrevocable-funeral-trust exclusions under TCA § 71-5-117)

Prohibited charges against the PNA (under 42 CFR § 483.10(g)(8), "Limitations on Charges"):

Facilities may not charge the PNA for:

• Nursing services (covered by Medicaid)
• Activities of daily living (ADL) assistance, bathing, dressing, feeding, toileting, transfer
• Drugs or biologicals (covered by Medicaid Drug Rebate Program or Medicare Part D)
• Routine personal hygiene items issued by the facility, comb, brush, soap, toothbrush, toothpaste, deodorant, denture care, sanitary napkins, basic shampoo
• Linens, gowns, slippers issued by the facility
• Standard meals
• Room cleaning, maintenance, repairs to standard equipment
• Standard medical equipment use (wheelchair, walker if part of routine care)

Tennessee F-tag enforcement: F570 (Security and Personal Funds) and F571 (Limitations on Charges) under CMS State Operations Manual Appendix PP. Tennessee surveyors with HFC issue these tags during routine and complaint surveys.

Facility staff sometimes attempt to bill the PNA for "incontinence supplies" beyond the facility's basic stock or "extra laundry." Both are nursing-care components and cannot be charged. If you see them on a quarterly statement, raise it with the administrator or the Ombudsman.

Group 1 (Nursing Facility), Patient Liability Math, Step by Step

Here's how Tennessee calculates a nursing-facility resident's patient liability in 2026:

Step 1, Start with countable monthly income

Add up:

• Social Security retirement, SSDI, or survivor benefits (gross before Part B premium)
• VA pension (capped at $90 if applicable, see "Veteran-Specific" below)3
• Private pensions, annuities (most pension distributions count)
• Required Minimum Distributions from IRAs (the entire RMD counts as income in the month received)
• Interest, dividends, royalties

Exclude (per TCA § 71-5-103, federal SSI rules at 20 CFR § 416.1100, and TennCare LTSS Manual):

• The first $20 of unearned income (general income disregard)
• The first $65 of earned income plus half the rest (earned income disregard, if applicable)
• VA Aid and Attendance and Housebound (38 USC § 5503 framework)
• Reparations from foreign governments, German Restitution payments
• Holocaust survivor reparations
• The community spouse's own income. TennCare applies the federal spousal-impoverishment framework at 42 USC § 1396r-5 when one spouse needs long-term services and supports, and under it the community spouse's income is not treated as the institutionalized spouse's.4

Step 2, Subtract the allowable deductions

A word about sequence, because it is easy to get wrong. TennCare's Post-Eligibility Treatment of Income policy lists seven allowable deductions and presents them as a list, not as an order of application. The only source that prescribes an order is the federal rule at 42 CFR § 435.725(c), which says the agency "must deduct the following amounts, in the following order": the personal needs allowance first, then maintenance needs of a spouse, then maintenance needs of a family, then expenses not subject to third-party payment (including Medicare and other health insurance premiums, deductibles, or coinsurance charges), then continued SSI and SSP benefits.1

TennCare's seven allowable deductions are:

1. Personal Needs Allowance, $70/month1
2. Mandatory expenses, such as garnishments, conservatorship or guardianship fees, court-ordered child support, court-ordered alimony, and Qualified Income Trust fees.4
3. Community Spouse Income Maintenance Allowance (CSIMA), for an institutionalized individual with a spouse residing in the community. For 2026 the community-spouse maintenance figure runs between $2,705.00 (the federal minimum through 6/30/2027) and $4,066.50 (the maximum, eff. 1/1/2026), depending on the community spouse's actual shelter costs and income.6
4. Dependent Income Maintenance Allowance (DIMA), for an institutionalized individual with a dependent residing in the community.4
5. Health insurance premiums, coinsurance, and deductibles, which is where the Medicare Part B premium sits when the resident pays it directly rather than having it covered by a Medicare Savings Program (QMB pays the Part A and Part B premiums; SLMB and QI1 pay the Part B premium)7, along with any Part D, Medigap, or Medicare Advantage premium the resident keeps paying.4
6. Incurred medical expenses not covered by TennCare Medicaid and allowed under the State Plan, including dental costs beyond TennCare's adult dental limits.1
7. An Incurred Medical Expenses Carry Forward Amount, for allowable medical expenses not previously deducted.1

Item 7 matters more than its dull name suggests: a resident who ran up an uncovered medical bill in an earlier month does not simply lose the deduction, and if a facility's arithmetic never shows a carry-forward line, ask why.

The Part D premium is often not a live deduction at all: a resident who qualifies for the full Part D Low-Income Subsidy (Extra Help) and is enrolled in a plan at or below their region's benchmark premium pays $0 in Part D premium. Choose a plan above the benchmark and the resident owes the difference, which is a real deduction.8

Step 3, Whatever remains is the patient liability

The facility bills Medicaid for the difference between the daily Medicaid NF rate and the monthly patient liability.4

Worked Example, Single Tennessee NF resident, no community spouse, no veteran benefits

(The worked examples below are hypothetical illustrations, not real cases.)

Mrs. Owens, age 84, lives at Magnolia Manor Nursing Home in Knoxville. She has:

• Social Security: $1,860/month
• Small private pension: $310/month
• No spouse, no dependents4

Step 1: Countable income = $1,860 + $310 = $2,170/month4

Step 2, Deductions:

• PNA: $701
• Medicare Part B premium (paid directly)
• No spouse, no family allowance, no court-ordered support, no Part D excess

After subtracting the $70 PNA and her Medicare Part B premium from her $2,170 income, Mrs. Owens turns over the remainder to Magnolia Manor each month as her patient liability. Magnolia Manor bills TennCare for the daily rate minus that patient share. Mrs. Owens keeps $70 in her resident trust fund, which she uses for her hair appointment, her phone bill, and small purchases at the canteen.1

Worked Example, Married TN NF resident with community spouse

Mr. Reyes, age 79, lives at a Memphis NF. His wife, Carmen, lives at home. Mr. Reyes has:

• Social Security: $2,440/month
• No VA pension in this example
• He pays Medicare Part B directly4

Carmen's income is $1,150/month (her own Social Security), and their housing costs are $1,890/month (rent, utilities, and property tax escrow).4

Step 1: Mr. Reyes's countable income = $2,4404

Step 2, Deductions:

• PNA: $70
• MMNA for Carmen: because Carmen's own income ($1,150) is well below the community-spouse maintenance range (a 2026 minimum of $2,705.00 and a maximum of $4,066.50, adjusted for her actual shelter costs), a large share of Mr. Reyes's income is diverted to her as the spousal allowance. (See TN spousal impoverishment guide for the full excess-shelter mechanics.)6
• Medicare Part B premium

Because the spousal maintenance allowance Carmen is entitled to exceeds Mr. Reyes's entire available income after the PNA and his Medicare premium, his patient liability is $0. His income flows to his trust fund, to Medicare, and to Carmen as the spousal allowance; Medicaid pays the full daily NF rate.4

This is a common outcome for married Tennesseans with a community spouse, especially when the institutionalized spouse has the larger income.

Group 2 and Group 3 (HCBS), The $2,982 Community PNA

CHOICES Group 2 (the at-home HCBS group for individuals who meet the nursing-facility level of care) and Group 3 (the at-risk group) work fundamentally differently from Group 1 institutional placement. Members live in their own home, an apartment, a relative's home, or a residential setting in the community. They receive in-home services (personal care, homemaker, adult day, home-delivered meals, attendant care, and more), not facility-based care.

For Group 2/3 members, the post-eligibility "Community PNA" maintenance allowance equals the full Special Income Standard, $2,982/month in 2026 (300% of the federal SSI Federal Benefit Rate of $994/month).2

This means most Group 2 and Group 3 members owe little or no patient liability. Their income up to $2,982/month is fully protected for community living expenses (rent, food, utilities, transportation, personal needs).4

How patient liability is calculated for Group 2/3

Following the post-eligibility framework at 42 CFR § 435.726 (the HCBS waiver post-eligibility rule):

Step 1: Countable income (same SSI methodology as Group 1)

Step 2: Deduct in this order:

• Community PNA = $2,982 (300% SSI FBR)4
• Family allowance for dependents
• Court-ordered support
• Health insurance premiums (Part B, Part D if not LIS-covered, Medigap)
• "Remedial care" not covered by TennCare

Step 3: Whatever remains is patient liability, paid to the assigned Managed Care Organization (BlueCare Plus, UnitedHealthcare Community Plan of Tennessee, or Wellpoint TN), NOT to a facility.

Because the Special Income Standard is also Tennessee's income cap for institutional Medicaid eligibility ($2,982 in 2026), most Group 2/3 members have income at or below the protection threshold, leaving $0 patient liability.2

What if a Group 2 member has income above $2,982?

Then they need a Qualified Income Trust (QIT, also called a Miller Trust) authorized federally by 42 USC § 1396p(d)(4)(B) and implemented in Tennessee through Tenn. Comp. R. & Regs. 1240-03-03-.03(8) and the TennCare ABD Eligibility Manual "Trusts" chapter (Tennessee has no stand-alone QIT statute; authority is regulatory). Income deposited to the QIT is excluded from the eligibility income cap. Only the income that flows out of the QIT for the resident's medical and personal needs counts in the patient-liability calculation. The Community PNA still applies.

Short-term NF stays

A short nursing-facility stay, say for post-surgical rehabilitation, is the seam where the two sets of arithmetic meet: the $70 institutional PNA and the $2,982 Community PNA cannot both apply to the same month, and which one governs depends on how TennCare and the MCO classify the member during the stay. Brevy has not been able to source a published TennCare rule setting a day-count at which the classification flips, so do not plan around one you have heard secondhand. Ask the MCO care coordinator, in writing, which group the member is in for each month of the stay and what the protected amount will be. Getting that answer late can mean months of patient liability nobody budgeted for.4

ECF CHOICES, I/DD Waiver Groups 4–8

Employment and Community First (ECF) CHOICES is Tennessee's comprehensive Section 1115 Medicaid demonstration for individuals with intellectual and developmental disabilities. It took over new I/DD enrollment from the older 1915(c) waivers on July 1, 2016, and sits inside the TennCare III §1115 demonstration, which CMS approved January 8, 2021 for a period running through December 31, 2030.9

ECF CHOICES has five service groups, each with its own service catalog:

• Group 4, Essential Family Supports (children under age 21 living with family)
• Group 5, Essential Supports for Employment and Independent Living (working-age adults, lower acuity)
• Group 6, Comprehensive Supports for Employment and Community Living (working-age, higher acuity)
• Group 7, Intensive Behavioral Supports
• Group 8, Comprehensive Behavioral Supports

For all five groups, the post-eligibility Community PNA is $2,982/month (300% SSI FBR), identical in mechanics to CHOICES Groups 2/3. ECF members live in the community (with family, in their own home, in a Family Model Residential Support setting, or a Companion Care arrangement) and the Community PNA preserves enough income for community living.2

ECF is administered jointly by the TennCare Long-Term Services and Supports (LTSS) division and the Tennessee Department of Disability and Aging (TDDA), formerly the Department of Intellectual and Developmental Disabilities (DIDD), renamed and restructured in 2023.

The Legacy 1915(c) DD Waivers: Statewide, CAC, and Self-Determination

Tennessee continues to operate three legacy 1915(c) Medicaid HCBS waivers for individuals who entered the I/DD service system before ECF CHOICES took over new enrollment on July 1, 2016: the Statewide waiver, the Comprehensive Aggregate Cap (CAC) waiver, and the Self-Determination waiver.9

There is no separate "Arlington waiver." Arlington refers to a class of former residents of the Arlington Developmental Center; along with former Clover Bottom and Harold Jordan Center class members, and people transitioning out of an institution through Money Follows the Person, they are among the limited exceptions under which the Statewide and CAC waivers remain open to new enrollment. The Self-Determination waiver is closed to new enrollment.9

TennCare's post-eligibility policy states the rule in one sentence: subtract 300% of the SSI Federal Benefit Rate from the total income of an individual receiving HCBS, PACE, or Self-Determination ID Waiver services. That is $2,982/month in 2026. Self-Determination is named on its face; the Statewide and CAC waivers are 1915(c) HCBS waivers, so their participants fall under the HCBS branch of the same sentence.4

What we could not source, and what to do about it: Brevy found no TennCare or Department of Disability and Aging publication setting a lower maintenance allowance for Statewide or CAC waiver participants. If a case manager or MCO tells your family that a legacy-waiver member's protected amount is something other than $2,982, ask which written policy sets it and get the citation. Do not assume a lower figure, and do not assume a higher one; the answer belongs in writing from the agency that administers the plan.4

If a family member on a legacy waiver has income above $2,982, the same Qualified Income Trust mechanics that apply to CHOICES apply to them.2

Veterans: How Does the VA $90 Cap Affect Your PNA?

The federal $90 VA pension cap

Under 38 USC § 5503(d)(2), when a single, childless veteran is receiving VA pension benefits AND becomes a Medicaid-paid resident of a nursing facility, no VA pension in excess of $90 per month may be paid to the veteran after the month of admission.3

A companion provision, 38 USC § 5503(d)(3), bars an offset in the other direction: the payment a nursing facility receives under a Medicaid plan may not be reduced by any amount of pension the veteran is permitted to keep. That is an anti-offset rule about what Medicaid pays the facility. It does not decide what the resident contributes to care or what the resident keeps for personal needs. That question is answered at the next step, by the state's post-eligibility rules, and Tennessee's are set out below.3

Read the statute's three conditions together, because all three have to be true:

• The veteran has neither a spouse nor a child.
• The veteran is covered by a Medicaid plan for nursing-facility services.
• The period is after the month of admission to the nursing facility.3

What TennCare does with the $90

Federal law caps the pension. Whether the veteran also keeps the Tennessee PNA is decided by TennCare's own post-eligibility rule, and TennCare answers it directly.

The patient-liability budget starts from total income, and TennCare's Aged, Blind and Disabled Manual (Policy 125.020) lists what is left out of that figure. "VA pensions limited to $90 per month" is on that list. The manual states that when the VA pension payment is limited to $90 per month, "the payment is aid and attendance and is not included in total income." The $70 PNA is then deducted from total income at the next step.1

Because the $90 never enters total income, the $70 PNA comes out of the resident's other income rather than out of the pension. A resident with at least $70/month of income besides the pension therefore keeps $160/month. A veteran whose only income is the capped pension keeps the $90, since there is nothing else for the PNA step to draw from.1

TennCare applies the $90 limit to a wider group than the federal statute's single, childless veteran. Its list covers three categories of person receiving Medicaid-covered nursing home care in a Medicaid-approved nursing facility: veterans who do not have a spouse or a dependent child, surviving spouses of veterans who do not have a dependent child, and surviving children of veterans.1

Two settings are carved out. TennCare states that the VA pension is not limited to $90 per month when the individual receives Home and Community-Based Services or is in a state veterans home, so neither the cap nor the $160 figure should be carried into an HCBS or TSVH case. The state-veterans-home rule is set out below.1

It does NOT apply to:

• Service-connected disability compensation (which has no cap)
• VA retirement pay (different pot of money)
• Non-Medicaid NF stays (private-pay)
• Community-based VA care

If the veteran is married or has a child, § 5503(d)(2) is not the provision that governs, and the $160 arithmetic above should not be assumed. Take that case to a VA-accredited representative or the Tennessee Department of Veterans Services before planning around a number.3

The cap is a steep reduction for a veteran drawing a full basic pension: the 2026 Maximum Annual Pension Rate for a single veteran without dependents is $17,441 a year.10

Tennessee State Veterans Homes (TSVH)

The Tennessee State Veterans' Homes (TSVH) are operated by the Tennessee State Veterans Home Board and are independent of the U.S. Department of Veterans Affairs. TSVH runs five homes as of 2026: Murfreesboro, Humboldt (the W.D. "Bill" Manning home), Knoxville (the Ben Atchley home), Clarksville (the Brigadier General Wendell H. Gilbert home), and Cleveland. A sixth home in Arlington, on 28.5 acres in rural Shelby County in West Tennessee, is still under construction; TSVH's own Arlington page lists an anticipated opening of "late 2025," a date that has already passed. The homes provide long-term care, skilled nursing care, and rehabilitative care including therapy services.5

Admission requires an honorable discharge from active service and a need for a skilled level of care, plus at least one Tennessee connection: Tennessee residency at the time of admission, birth in Tennessee, entering the U.S. Armed Forces in Tennessee, a Tennessee address as the official Home of Record, or an immediate family member who serves as the primary caregiver and is a Tennessee resident. Spouses and Gold-Star parents are eligible on a space-available basis.5

How a TSVH stay is paid for

A TSVH stay is not billed the way a community Medicaid nursing-facility stay is. TSVH describes two VA programs a qualified veteran may be eligible for: the Basic Per Diem, which TSVH applies toward a private-pay bill to reduce the out-of-pocket daily room rate, and the VA Higher Per Diem, under which the VA covers 100 percent of the cost of the stay. The Higher Per Diem is limited to a veteran with a service-connected disability of 70 percent or more, a veteran who needs nursing home care related to a service-connected disability, or a veteran rated totally disabled based on individual unemployability. A veteran who is not eligible for VA assistance may pay through Medicare, a Medicare managed care plan, Tennessee Medicaid, long-term care insurance, or private payment.5

Because TennCare is only one of several ways a TSVH stay gets paid for, the arithmetic that produces $160 at a community nursing facility does not carry over, and TennCare says so explicitly. Its post-eligibility policy states that the VA pension is not limited to $90 per month when the individual is in a state veterans home. It goes on: if a veteran or the surviving spouse of a veteran is in a state veterans home and receives more than $90 per month in VA pension, the pension, including any payment made for aid and attendance or for unreimbursed medical expenses, is counted in total income and applied to the state veterans home's cost of providing that care.1

That is close to the opposite of the community-nursing-facility result. In a community NF the pension is capped and set aside; at a TSVH the full pension is counted and goes toward the cost of care. Do not plan around the $160 figure for a TSVH admission.1

Action item for veteran families: Before TSVH placement, ask explicitly: "If TennCare pays for my care here, how does my VA pension flow, and what will I keep each month for personal needs?" Get the answer in writing. The Tennessee Department of Veterans Services (1-877-VET-INFO) is the state-level resource.5

The TennCare interaction, special income standard math

A veteran with VA Pension is subject to Tennessee's $2,982/month income cap for institutional Medicaid eligibility.2 But the post-eligibility VA $90 cap applies AFTER eligibility is established.3

Worked example: Marine veteran Mr. Tolliver, age 78, a widower with no children, lives at a community NF in Chattanooga. Before placement he receives Social Security, a basic VA Pension, and an Aid & Attendance increment. He has neither a spouse nor a child, which is what puts him inside 38 USC § 5503(d)(2) at all.

Step 1, Pre-eligibility: the A&A increment is excluded under SSI rules (it's not "pension"). Whether his remaining countable income clears TN's $2,982 income cap is a case-by-case determination; if it exceeds the cap he needs a Qualified Income Trust to qualify.2

Step 2, Post-eligibility once on Medicaid: VA reduces his pension to $90/month under 38 USC § 5503(d). TennCare leaves that $90 out of his total income, so his Social Security is what the deductions come out of. After the $70 PNA and his Medicare Part B premium are subtracted, the remainder of his Social Security is owed as patient liability, and he keeps $160/month ($70 PNA + $90 VA) for personal use.1,3

Had Mr. Tolliver gone to a Tennessee State Veterans Home instead, his bill would be handled under TSVH's own payment structure, VA per diem first, with TennCare only one of several fallback payers, so he would need to confirm with the home in advance what he would keep each month.5

For deeper detail on Tennessee veteran-specific Medicaid eligibility, see Brevy's Tennessee State Veterans Homes guide and Tennessee VA Pension and Medicaid LTSS interaction.

Working Residents, The $100 Sheltered Workshop Disregard

Tennessee, like most states, allows a limited earned-income disregard for residents who continue to work, typically in a sheltered workshop or supported employment setting through a 1915(c) waiver provider, an ECF CHOICES employment service, or a private employer.

The disregard structure follows SSI methodology under 20 CFR § 416.1112:

• The $20 SSI general income deduction, which TennCare applies in its Aged, Blind and Disabled budgeting7
• The first $65 of earned income in a month, plus one-half of remaining earned income in a month, both excluded under 20 CFR § 416.1112(c)11

For practical TennCare purposes, a sheltered workshop earner with $200/month gross earnings would have:

• $200 − $65 = $135
• $135 ÷ 2 = $67.50 countable11

So $200 in gross earnings adds only $67.50 to countable income for patient-liability purposes. For an individual with greater need who participates in a sheltered workshop, TennCare subtracts up to $100 of earnings plus the $70 PNA.1

This matters most for ECF CHOICES Group 5/6 members who participate in supported employment. It rarely applies to nursing-facility residents because Medicaid NF residents are typically too medically complex to maintain employment.

The Tennessee DHS Family Assistance Manual (Vol. II, Chapter 110) and TennCare LTSS Pre-Eligibility Manual codify these calculations. Counselors at the local DHS office (1-866-311-4287) can run the exact figure for a specific individual.

When PNA Balance Approaches the $2,000 Asset Limit

Tennessee's resource limit for institutional Medicaid (and for most LTSS waivers) is $2,000 for an individual, the same figure as the SSI resource limit TennCare's ABD pathway runs on.12 The community spouse has a much higher Community Spouse Resource Allowance, $162,660 for 2026 (the federal maximum, effective 1/1/2026 per CMS CIB dated 12/9/2025), with a $32,532 minimum. See the dedicated TN spousal impoverishment guide for snapshot mechanics, fair-hearing increases, and the SFA model.4

PNA accumulates in the resident trust fund. A resident who spends modestly can build up unspent PNA over time and approach the $2,000 individual resource limit; once the balance approaches $2,000, the resident is at risk of losing Medicaid eligibility for excess resources.2

What facilities must do

Per 42 CFR § 483.10(f)(10)(iii), the facility must notify the resident or their representative when the balance reaches within $200 of the SSI/Medicaid resource limit (that is, at $1,800 against Tennessee's $2,000 limit). The notification triggers the family's obligation to spend down.2

What families can do, allowable spend-down for PNA balances

• Burial pre-payment: Tennessee excludes irrevocable burial-space items plus an irrevocable funeral trust under TCA § 71-5-117(b)
• Personal effects (clothing, electronics, jewelry; Tennessee uses the federal SSI household-goods and personal-effects exclusion at 20 CFR § 416.1216)
• Dental work beyond TennCare coverage limits (Tennessee dental coverage for adults is limited; see Brevy's TN Medicaid dental coverage guide)
• Prosthetic and orthotic devices beyond Medicaid coverage
• Hearing aids and eyeglasses beyond Medicaid coverage
• Adaptive equipment for the resident's individual needs
• Personal goods purchase, clothing, books, hobby supplies, personal electronics
• Family visits, the resident's PNA can pay for a family member's transportation to visit

What is NOT a permitted spend-down

• Gifts to family in excess of de minimis amounts (subject to the 60-month look-back at 42 USC § 1396p(c) and TCA § 71-5-1605)13
• Loans to family
• Investment purchases
• Cash withdrawals retained as cash

The 60-month look-back applies. A gift to a family member is a transfer for less than fair-market value and triggers a penalty period.13

For more detail, see Brevy's Tennessee Medicaid look-back and penalty divisor guide.

Death of a Resident, Where the Money Goes

Per 42 CFR § 483.10(f)(10)(vi), the facility must convey the deceased resident's personal funds to:

1. The administrator/executor of the estate
2. If no estate is opened (small-estate threshold), to the next of kin under Tennessee intestacy rules (TCA § 31-2-104)

Within 30 days of death, with a final accounting reconciling all deposits and withdrawals.

Tennessee small-estate procedure

Tennessee's small-estate procedure under TCA § 30-4-101 covers modest estates by personal-property value (excluding the homestead and one motor vehicle). For most resident PNA balances at death, the small-estate affidavit (TCA § 30-4-103) is the applicable procedure, far simpler than full probate.

The process:

1. Wait 45 days from date of death
2. File a small-estate affidavit at the chancery or probate court in the county of the decedent's residence
3. Affidavit requires identification of all assets, debts, and heirs
4. Once granted, the affidavit is presented to the facility
5. Facility releases the trust fund balance + final accounting

Tennessee estate recovery

Tennessee's State Plan defines the recoverable "estate" as all property and other assets owned at the moment immediately preceding death, as limited or expanded by Tennessee Code Annotated Titles 30, 31, and 32 and by the Tennessee courts. So the scope is set by Tennessee probate law rather than by a flat probate-only rule written into the plan itself, and it can move as that law and those decisions move. Tennessee does not apply TEFRA liens, though that answer disclaims the TEFRA lien species specifically; it is not a statement that no lien of any kind can attach, and 42 USC § 1396p(a)(1)(A) still permits a pre-death lien pursuant to a court judgment on account of benefits incorrectly paid. All recovery claims of $10,000 and below are not cost effective, and where the claim is below $10,000 the State provides a release of the claim.14

A resident's trust fund balance at death is an asset the decedent owned immediately before death, so it falls inside that definition, but in practice TennCare's $10,000 cost-effectiveness threshold means a small balance is released rather than pursued. The family receives the funds.14

For deeper detail, see Brevy's Tennessee Medicaid estate recovery guide.

Power of Attorney, Conservatorship, and Resident Representative Rules

Tennessee operates under the Tennessee Health Care Decisions Act (TCA § 68-11-1801 et seq.) and the Tennessee Conservatorship Act (TCA § 34-3-101 et seq.).

POA, Power of Attorney for finance

A durable financial POA (TCA § 34-6-101 et seq.) authorizes an agent to manage the resident's finances, including the PNA / resident trust fund. The POA must be:

• Written and signed by the resident before incapacity
• Notarized for real estate transactions; advisable for all financial transactions
• "Durable", i.e., effective when the principal is incapacitated, per TCA § 34-6-102

The facility may require a copy of the POA before allowing the agent to deposit/withdraw from the resident trust fund.

Conservatorship

Where there is no POA and the resident lacks capacity, the family must petition for conservatorship of the person and/or estate (TCA § 34-3-102). Tennessee uses the term "conservator" for both adult guardianships and protective arrangements for incapacitated adults.

The petition is filed in the chancery court of the county of the resident's residence. The court appoints a guardian ad litem to investigate, schedules a hearing, and may appoint a conservator. The conservator of the estate has authority over the resident trust fund.

Annual accountings are required (TCA § 34-3-110), and major financial decisions require court approval. The resident has the right to legal representation throughout, typically through a public defender (if indigent) or court-appointed counsel.

Resident Representative under federal law

Independent of state POA / conservatorship, federal law (42 CFR § 483.5) defines "resident representative" as anyone the resident has designated, anyone authorized under state law (POA, conservator, surrogate), or, if the resident lacks capacity and no other representative is identified, any individual the facility identifies as having an interest in the resident's welfare.

The facility must allow the resident representative the same access to the resident trust fund as the resident would have. If a representative is denied access, this is an F567 deficiency under CMS rules.

Cross-State PNA Comparison (2026)

How does Tennessee's $70 stack up? Every state must set its nursing-facility PNA at or above the $30 federal floor, and states may set it higher. Tennessee's $70 sits well above that federal minimum.1

For the complete state-by-state distribution, the different typologies of state PNA design (federal-floor states, modest-increase states, indexed states, regional leaders), and how the proposed PNA Modernization Act would change the federal floor, see Brevy's Medicaid Personal Needs Allowance Explained federal hub, which owns the canonical state-by-state PNA table.

The Federal $30 Floor and the PNA Modernization Act

The PNA's $30 federal floor has been frozen since the Omnibus Budget Reconciliation Act of 1987 (P.L. 100-203, effective July 1, 1988), and has never been indexed for inflation. Over the decades since, its real purchasing power has eroded substantially.1

The PNA Modernization Act

Federal legislation has been proposed in successive Congresses to raise the $30 floor and index it to inflation, with the most recent bills proposing a substantially higher floor tied to the consumer price index. If such a bill became law, Tennessee's nursing-facility PNA would automatically rise to at least the new federal minimum, because states must meet the federal floor. Because the PNA is deducted from the resident's own income rather than paid by Medicaid, a higher floor mainly shifts a modest amount of each resident's income back into their pocket and slightly increases the Medicaid match that fills the gap.1

For the bill numbers, sponsors, endorsers, and the full legislative history of PNA-modernization efforts, see Brevy's Medicaid Personal Needs Allowance Explained federal hub, which tracks the federal legislation.

Tennessee PNA History 1988 to 2026

The long freeze at $50 cost Tennessee NF residents real purchasing power; the 2025 raise to $70 under Public Chapter 986 of 2024 was the first increase in many years, though it did not fully restore residents to their earlier buying power.1

Advocacy work leading up to passage came primarily from:

• Tennessee Justice Center (Nashville)
• AARP Tennessee (Nashville)
• Tennessee Health Care Association
• Tennessee Long-Term Care Ombudsman, operated through the Tennessee Commission on Aging and Disability
• The Arc Tennessee
• LeadingAge Tennessee (the senior services trade association)

Worked Example: HCBS Group 2 Member at Home

The single-resident and veteran patient-liability cases are worked in full above (see Mrs. Owens, Mr. Reyes, and Mr. Tolliver). The one mechanic those don't show is the HCBS Community PNA, which produces a very different result. (All worked examples in this guide are hypothetical illustrations, not real cases.)

Mr. Adkisson, 76, has dementia and lives with his daughter in Knoxville. He receives CHOICES Group 2 services (home-delivered meals, attendant care, and adult day care). Income: $2,210/month Social Security.4

• $2,210 income
• − $2,982 Community PNA → entire income protected
• = $0 patient liability4

Mr. Adkisson pays $0/month patient liability to his MCO (BlueCare Plus). His full income stays in his pocket and helps pay his rent contribution to his daughter, his prescription copays, his phone, and personal needs. The MCO collects $0 share of cost. Because his income is at or below the $2,982 Special Income Standard, the Community PNA protects all of it. This is the defining difference between community HCBS and institutional (Group 1) placement.2

Where to Get Help When PNA Is Mishandled

The Long-Term Care Ombudsman is the right starting point for most PNA-related complaints. The ombudsman is independent of the facility, the state Medicaid agency, and the licensing board, and is empowered under the federal Older Americans Act (42 USC § 3058) to advocate for residents.

Pending Policy Watch

Items to track over 2026–2027:

1. TennCare administrative rule update: Tenn. Comp. R. & Regs. 1200-13-01-.08(1)(a) still references $50. A formal rule amendment to conform the rule to the $70 statute is expected but had not been posted for public comment as of this writing.1

2. ALW PNA equity gap: Tennessee does not operate an Assisted Living Waiver in the same form as Ohio's. CHOICES Group 2 covers some assisted-living settings (CBRA, Community-Based Residential Alternatives), and the Community PNA framework applies.

3. Sheltered workshop reform: The federal sub-minimum-wage debate (Section 14(c) of the Fair Labor Standards Act) may curtail sheltered workshops. If Tennessee's sheltered workshops close, the $100 earned-income disregard becomes mostly moot, and ECF members shift to supported employment under different earning structures.1

4. TennCare III §1115 demonstration renewal: CMS renewal of the demonstration will likely revisit ECF Community PNA percentages. Watch for proposed amendments.

5. PNA Modernization Act: Proposed federal legislation would raise the $30 federal floor and index it to inflation. If enacted, Tennessee would automatically benefit. Track the House Energy & Commerce Subcommittee on Health.1

6. The VA $90 cap figure itself: $90 is written into 38 USC § 5503(d)(2) as a flat dollar amount with no inflation index, so it erodes the way the federal $30 PNA floor has. Any change requires an act of Congress; watch the statute rather than an agency notice.3

7. The sixth TSVH home in Arlington: The Arlington home in rural Shelby County is still under construction, and TSVH's published opening estimate of "late 2025" has already passed. West Tennessee veteran families planning around it should confirm status directly with TSVH.5

8. Public Chapter 182 of 2025 (Freedom for Family Caregiving Act): Effective 7/1/2025. Expands paid family caregiver opportunities under CHOICES; it does not directly affect PNA but affects who can be paid to provide care. See Brevy's Tennessee paid family caregiver guide.

12 Tennessee-Specific PNA Pitfalls

1. The $50 rule lag. Tenn. Comp. R. & Regs. 1200-13-01-.08(1)(a) still says $50; the controlling authority is TCA § 71-5-147 at $70. If a facility or counselor cites $50, push back with the statute.1

2. Conflating Group 1 PNA with Group 2/3 Community PNA. They're entirely different, $70/month for NF residents vs. $2,982/month for HCBS members. Don't apply Group 1 logic to a home-based member or vice versa.4

3. Assuming a Tennessee State Veterans Home bills like a community nursing facility. TSVH is independent of the VA, is paid first through VA per diem, and treats TennCare as one of several payment routes. TennCare's own policy says the $90 limit does not apply in a state veterans home, and that a pension above $90 there is counted in total income and applied to the home's cost of care. Confirm in writing at admission what the resident will keep each month.1,5

4. Assuming there is an "Arlington waiver," or that the legacy waivers are all shut. Tennessee's three legacy 1915(c) DD waivers are Statewide, Comprehensive Aggregate Cap, and Self-Determination; Arlington names a former-class-member group, not a waiver. Self-Determination is closed to new enrollment, but Statewide and CAC stay open under limited exceptions, including Money Follows the Person transitions and former Arlington, Clover Bottom, and Harold Jordan Center class members. If someone tells your family the door is shut, ask about those exceptions.9

5. Late notification of approaching $2,000 cap. Facilities are required to notify when the balance nears the $2,000 individual resource limit. If your facility doesn't, you can lose Medicaid for excess resources without warning. Check trust fund balances quarterly.2

6. Believing facility staff that the PNA covers personal hygiene items. It doesn't, the facility must provide soap, toothpaste, comb, brush, denture care, basic shampoo, sanitary napkins, deodorant, and basic clothing. F571 enforcement is regular in Tennessee.

7. Letting the facility cash the resident's Social Security check directly. It's permissible but creates accounting complications. Better practice: Social Security goes to the resident's bank account (or representative payee), patient liability is paid to the facility by check or ACH, and the $70 PNA stays in the bank or goes to the trust fund.1

8. Not getting quarterly trust-fund statements. They're required. If you don't get them, the facility is non-compliant. Demand them in writing.

9. Spending PNA on family gifts. Triggers the 60-month look-back. The PNA is for the resident's personal needs, not family transfers.13

10. Forgetting Part D Extra Help. A resident with the full Low-Income Subsidy who is enrolled in a plan at or below their region's benchmark premium pays $0 in Part D premium, so there is nothing to deduct. If a facility's patient-liability worksheet still subtracts a Part D premium, ask which plan and which benchmark it is working from, because the resident may be losing income to a deduction that should be zero. Above the benchmark the resident does owe the difference.8

11. Confusing "patient liability" with "Medicaid liability". Patient liability is what the resident pays. Medicaid liability (or Medicaid daily rate) is what the program pays the facility. They're complementary, not the same.

12. Missing the 30-day post-death distribution deadline. If a resident dies and the family doesn't see the trust-fund balance within 30 days, that's a federal violation. Escalate to the Ombudsman.

Related Reading

• Medicaid Personal Needs Allowance Explained, federal hub: the $30 floor (frozen since OBRA-87), the complete state-by-state PNA table, Resident Trust Fund federal mechanics, VA $90 cap stacking, and the PNA Modernization Act.1
• Tennessee Medicaid (TennCare) overview, the umbrella TennCare guide
• Tennessee Medicaid eligibility and income limits, the Special Income Standard ($2,982/month), QIT mechanics, asset rules
• Tennessee long-term care nursing home guide, daily rates, level-of-care, admission process
• Tennessee CHOICES program overview, Groups 1, 2, and 3
• Tennessee ECF CHOICES (I/DD), Groups 4–8
• Tennessee BlueCare Plus FIDE-SNP, managed care for dual eligibles
• Tennessee State Veterans Homes (TSVH), the five homes, admission requirements, and how a stay is paid for
• Tennessee Medicaid estate recovery, who is subject, the $10K cost-effectiveness release, and the survivor protections
• Tennessee Medicaid look-back and penalty divisor, 60-month look-back rules
• Tennessee Medicaid managed care plans, BlueCare, UnitedHealthcare, Wellpoint
• Tennessee paid family caregiver guide, CHOICES consumer direction
• Tennessee assisted living, care options
• Tennessee nursing homes, care options
• Tennessee memory care, care options
• Ohio Medicaid Personal Needs Allowance, sister state PNA guide
• Texas Medicaid Personal Needs Allowance, sister state PNA guide
• Florida Medicaid Personal Needs Allowance, sister state PNA guide

Learn More

Find personalized help understanding Tennessee Personal Needs Allowance rules 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.