Texas Medicaid pays for nursing home care for people who qualify. It covers that care under regular Medicaid, not through one of the home-based waivers Texas may cap and put behind an interest list. The income limit is $2,982/month, the asset limit is $2,000, and the state looks back 60 months at your financial history, counted from the later of the date you entered the facility or the date you applied.

This guide explains who qualifies, how the money works once you're in, what the state protects for your spouse, and how families use Medicaid planning to preserve assets legally.

In This Guide

Institutional vs Community Medicaid

Texas has two main pathways for Medicaid long-term care, and they work differently.

Institutional (Nursing Home) Medicaid covers care in a nursing facility, under regular Medicaid rather than a waiver. Texas is allowed to cap how many people a 1915(c) waiver serves and to open an interest list when demand exceeds that capacity, and that is not how regular Medicaid works. This is why some families end up in nursing homes even when they'd prefer home-based care.

Community-Based Medicaid (HCBS Waivers) covers care at home or in assisted living through programs like STAR+PLUS HCBS, which HHSC says operates like a 1915(c) waiver but is provided through Texas's 1115 Healthcare Transformation Waiver. Because waiver slots can be capped, there's an interest list: anyone can put their name on it, first come, first served, by calling 1-877-438-5658, and HHSC doesn't decide waiver eligibility until a slot opens and the person reaches the top of the list. Someone already on Medicaid and enrolled with a managed-care plan may be able to bypass the list through the upgrade process, and a person living in a nursing facility may become eligible for STAR+PLUS HCBS through Money Follows the Person. The $2,982 income limit is the same for waiver services as for a nursing facility, but how soon care can start is completely different.

The practical impact: if your loved one needs care now and can't wait for an HCBS waiver slot, nursing home Medicaid may be the faster path to covered care.

Not sure which Medicaid pathway fits your situation? Chat with Brevy for help understanding your options.

Texas Medicaid Nursing Home Eligibility Requirements

Financial Requirements

Requirement Single Applicant Married (one spouse applying)
Monthly income limit $2,982 $2,982 (applicant's income only)
Countable asset limit $2,000 $2,000 (applicant only)
Spousal Protected Resource Amount (the Texas name for the Community Spouse Resource Allowance) N/A The greater of half the couple's combined countable resources or $32,532, capped at $162,660

What counts as income: the $2,982 limit applies to total countable income, so regular monthly income such as Social Security and pension payments is part of the count.

What counts as assets: the $2,000 is a limit on countable resources, not on net worth. The excluded assets below come off the total first, so a homeowner with a car isn't over the limit because of the house or the car.

Exempt (Non-Countable) Assets

These don't count toward the $2,000 limit:

  • Primary home, which can be excluded where the applicant or spouse has an ownership interest and it is the principal place of residence of either of them, or where they no longer live there but intend to return (shown mainly by a signed Form H1245, Statement of Intent to Return Home, or a similar written statement from a spouse or representative). A person whose equity interest in the home is above the substantial home equity limit, which Texas set at $752,000 effective January 1, 2026, can't get vendor payment in an institution or HCBS waiver services. That equity limit does not apply if the applicant's spouse, or a child who is under 21 or is blind or permanently and totally disabled, lawfully lives in the home.
  • One automobile, excluded regardless of value
  • Burial spaces, excluded regardless of value, and an irrevocable prepaid burial contract, which is not a countable resource
  • Designated burial funds, but only up to $1,500 per person, and that $1,500 maximum drops dollar for dollar by the face value of any excluded life insurance and by any irrevocable prepaid burial contract
  • Household goods used regularly in or near the home, and personal effects such as things you wear or carry, items with an intimate personal connection or cultural or religious significance, and items needed because of a disability. Anything bought or held for its value or as an investment is counted, not excluded, unless a different exclusion covers it
  • Life insurance with a face value of $1,500 or less per insured person

Medical Requirements

The applicant must meet Texas's medical necessity criteria, which means a nursing facility level-of-care determination, and must be 65 or older or meet Social Security's definition of disability. Texas also requires living in a Medicaid-contracted long-term care facility for at least 30 consecutive days.

The Miller Trust (Qualified Income Trust)

If countable income is over $2,982/month, the applicant isn't automatically shut out. Texas allows a Qualified Income Trust (Miller Trust): income deposited into the trust account in the same month it's received is disregarded when HHSC tests eligibility, and the trust itself isn't counted as a resource. The rules are strict. The trust must be irrevocable, hold only income (never savings), and pay the State of Texas whatever is left at death, up to the Medicaid paid. Income not deposited in its month of receipt counts for that month, and a trustee who doesn't pay the income out by the end of the following month has made a transfer of assets. A QIT also doesn't lower what the resident pays toward care, because that co-payment is figured on total income. Have an elder law attorney draft it to HHSC's requirements.

How Texas Medicaid Pays the Nursing Home

Once Medicaid approves nursing home coverage, here's what happens financially:

  1. All of the resident's income goes toward the cost of care, except:

    • A $75/month Personal Needs Allowance the resident keeps for personal expenses. That is the nursing facility rate; Texas sets the allowance at $85 for someone in assisted living or foster care and at $2,901 for someone on an HCBS waiver, so don't carry the $75 into a non-facility plan.
    • Guardianship fees, the maintenance needs of a spouse, the maintenance needs of the family, and incurred medical expenses, deducted in that order after the personal needs allowance
    • Certain other expenses if the resident meets program rules, which can include health insurance premiums
    • Any Monthly Maintenance Needs Allowance for the spouse (see below)

  2. Medicaid pays the difference between what the resident contributes and the nursing home's Medicaid rate. A Medicaid nursing facility must accept that payment as payment in full and can't charge the resident's own funds for services Medicaid pays for, though it can charge for extras the resident asks for that go beyond covered services.

In practice, the resident keeps the $75 personal needs allowance, the rest of their income (after allowed deductions such as any spousal allowance) is applied to the nursing home bill, and Medicaid pays the remaining balance of the facility's Medicaid rate.

Spousal Protections

Texas applies the federal spousal-impoverishment rules, which protect part of a married couple's savings and income for the at-home spouse when the other spouse enters a nursing home.

Community Spouse Resource Allowance (CSRA)

The at-home spouse doesn't automatically keep a flat $162,660. At the resource assessment, HHSC adds up the couple's combined countable resources, leaving out the home, household goods, personal goods, one car and burial funds, and protects the greater of one-half of that total or $32,532, but not more than $162,660. Texas's own name for this protected amount is the Spousal Protected Resource Amount (SPRA).

Those two figures are the standards for that assessment step, not a ceiling on everything the at-home spouse can ever keep. A community spouse is entitled to a fair hearing on the resource allowance, and an allowance set through a fair hearing or a court order can exceed $162,660. Texas calls this an expanded SPRA, which can protect assets above the federal maximum. The MEPD specialist expands it on your signed Form H1275 request, or a hearing officer does through a fair hearing, and you can appeal only after a Medicaid application is filed. It isn't automatic: the nursing home spouse's income, minus their personal needs allowance, goes to the at-home spouse first, and only a remaining shortfall below the $4,066.50 Spousal Allowance earns more protected resources (enough to produce that income at a one-year CD rate), never more than the couple's combined countable resources when the continuous facility stay began.

Monthly Maintenance Needs Allowance (MMNA)

If the at-home spouse's own income is below $4,066.50/month, a portion of the nursing home spouse's income can be diverted to bring the community spouse up to that amount. This protects the at-home spouse's standard of living. One labeling trap is worth knowing before you read the paperwork: HHSC's budget reference chart calls $4,066.50 the Minimum Monthly Maintenance Needs Allowance, or Spousal Allowance, while CMS publishes the identical $4,066.50 as the 2026 federal Maximum Monthly Maintenance Needs Allowance. The two authorities label the same dollar figure in opposite directions, and the figure a Texas caseworker works from is the one on the HHSC chart.

The Home

The primary residence can be an excluded resource while either spouse lives there, and it can stay excluded if the applicant moves into a facility but intends to return home, shown mainly by a signed Form H1245, Statement of Intent to Return Home. After death, though, Texas's Medicaid Estate Recovery Program can file a claim against the estate of a recipient who was 55 or older when they got long-term care, but only if there's no surviving spouse, no surviving child under 21, no surviving blind or disabled child, and no unmarried adult child who lived in the home for the 12 consecutive months right before the death.

The 5-Year Look-Back and Penalty Periods

Gifts and below-value sales made in the five years before applying can delay the day Medicaid starts paying the nursing home.

How the Look-Back Works

Texas reviews 60 months (5 years) of financial transactions, and the window is anchored to the later of two dates, the date the person was institutionalized or the date of the Medicaid application, rather than to the application alone. For someone who moves into a facility and applies months later, that pushes the start of the look-back forward. Any assets transferred below fair market value during that window can trigger a penalty period during which Medicaid won't pay for care.

How the Penalty Is Calculated

Texas divides the total uncompensated value of the transfer by the daily penalty divisor of $262.37 (for case actions on or after September 1, 2025) and rounds down to whole days. The larger the gift, the longer the penalty: dividing the amount transferred by $262.37 gives the number of days Medicaid will not pay. In Texas the penalty starts on the first day of the month of the medical effective date, if the person meets every other eligibility requirement.

During the penalty period, the applicant is responsible for the full private-pay cost of nursing home care out of pocket, which in Texas runs a median of about $5,627 a month for a semi-private room.

What Triggers a Penalty

  • Gifting money to children or grandchildren
  • Selling property below market value
  • Paying off a relative's debts
  • Adding a child's name to a bank account and them withdrawing funds
  • Donating to charity in large amounts

What Doesn't Trigger a Penalty

  • Paying fair market value for goods or services
  • Transfers of any asset to a spouse, or to someone else for the spouse's sole benefit
  • Transfers of any asset to a child who is blind or permanently and totally disabled, or to a trust set up solely for that child
  • Transfers of the home to a child under 21, or to a sibling who has an equity interest in the home and lived there for at least one year immediately before the person entered the facility
  • Transfers of the home to a caregiver child, a son or daughter who lived in the home for at least two years immediately before the parent entered the facility and who, as determined by the state, provided care that let the parent live at home instead. This one isn't automatic: HHSC makes that determination, so expect to prove the caregiving to its satisfaction

Even a transfer that doesn't fit these exemptions may be excused if all the transferred assets are returned, if you can show they were given away exclusively for a purpose other than qualifying for Medicaid, or if denying coverage would work an undue hardship.

Medicaid Planning Strategies

Medicaid planning is the legal process of arranging finances to qualify for coverage while protecting the family's assets. It isn't fraud. It's using the rules as written. Here are strategies families use in Texas:

Spend-Down on Exempt Assets

Convert countable assets into exempt ones:

  • Pay off the mortgage. The home itself can be an excluded resource, but watch the ceiling: equity above $752,000 blocks vendor payment in an institution and HCBS waiver services, unless a spouse, or a child who is under 21 or blind or permanently and totally disabled, lives in the home
  • Buy an irrevocable prepaid burial contract, which is not a countable resource. Note that its face value reduces the separate $1,500 burial fund exclusion dollar for dollar
  • Make home repairs or modifications
  • Pay off debts and bills

Medicaid-Compliant Annuities

A Medicaid-compliant annuity converts a lump sum of cash into a stream of income payments. Under federal law, buying one counts as a transfer for less than fair market value unless the State is named remainder beneficiary, either first in line for at least the total Medicaid paid, or second after a community spouse or a minor or disabled child. To keep the annuity from being treated as an asset, it must also be irrevocable and nonassignable, actuarially sound, and pay equal amounts with no deferral and no balloon payment (annuities tied to retirement accounts follow a separate rule). States can add their own conditions to that federal list, so have an elder law attorney check any annuity against HHSC policy before you buy.

Caregiver Agreements

A formal, written Personal Care Agreement between a parent and an adult child who provides care can help show that payments to the child were fair-market-value compensation for services rather than a gift. Because a transfer for less than fair market value inside the look-back can trigger a penalty, have an elder law attorney draft the agreement before payments start and keep the pay in line with what the care is worth.

When to Talk to an Attorney

If your loved one has more than $2,000 in countable assets and may need nursing home care within five years, consult an elder law attorney. The sooner you plan, the more options you have. Find a certified elder law attorney through the National Academy of Elder Law Attorneys (NAELA).

Situations where an attorney's advice is especially worth having:

  • The applicant has a house, retirement accounts, or savings above the limit
  • Gifts or transfers were made within the past five years
  • The community spouse needs income protection
  • The family wants to protect the home from estate recovery

How to Apply for Nursing Home Medicaid

1
Step 1

Gather your documents

HHSC has to establish identity, income, resources and other eligibility factors, but it checks electronic data sources first and should ask for paper only when that data doesn't match what you've told it. Have bank statements ready for the month you apply and the three months before it.

2
Step 2

Submit the application

Apply online at yourtexasbenefits.com, or send the paper application, Form H1200, to the Texas Health and Human Services Commission (HHSC) by mail or fax or take it to a local benefits office (call 2-1-1 to find one). Admission also runs through the Preadmission Screening and Resident Review (PASRR), a federally mandated prescreening for mental illness and intellectual or developmental disability that every person seeking admission to a Medicaid-certified nursing facility goes through, whatever their age or payer source.

3
Step 3

Complete the assessment

HHSC reviews financial eligibility and medical necessity. For an applicant 65 or older, HHSC must decide within 45 days, counted from the day it receives the completed and signed application. If a caseworker sends Form H1020 asking for missing information, the final due date is the 39th day from the date of application, and HHSC doesn't send a second request.

4
Step 4

Claim retroactive coverage

Federal law requires Medicaid to cover care furnished as early as the third month before the month of application, if your parent got covered care then and would have been eligible at the time. If you apply in April, coverage can reach back into January, but the exact start date inside that window is set by the state plan, so don't assume it begins on January 1. The three-month window is the federal default, and a state's window can be shorter under an approved Section 1115 demonstration, so confirm it with HHSC. For applications made on or after January 1, 2027, federal law shortens the window to two months before the application month for most applicants.

Frequently Asked Questions

Can I protect my parent's house from Medicaid?

The house can be an excluded resource while the applicant or spouse lives there, or while the applicant intends to return, and for vendor payment in an institution or for HCBS waiver services the equity interest has to stay at or below $752,000, the limit Texas set effective January 1, 2026. That equity test does not apply if the applicant's spouse, or a child who is under 21 or blind or permanently and totally disabled, lives in the home. After death, though, Texas's Medicaid Estate Recovery Program can file a claim against the estate, and only when there's no surviving spouse, child under 21, blind or disabled child, or unmarried adult child who lived in the home for the 12 consecutive months before the death. One option is the caregiver child exemption, which lets the parent transfer the home without a penalty to a son or daughter who lived there for at least the two years immediately before admission and, as HHSC determines, provided care that kept the parent at home. Whether a deed or trust keeps the home out of an estate recovery claim turns on Texas estate law, so get an elder law attorney's advice before you sign anything.

What if my parent's income is over $2,982/month?

Look at a Qualified Income Trust (Miller Trust). Income deposited into the trust account in the same month it's received is disregarded when HHSC tests eligibility. The trust must be irrevocable, hold only income, and repay Texas from whatever is left at death, up to the Medicaid paid. Have an elder law attorney set it up so it meets HHSC's requirements.

How long does it take to get approved?

For an applicant 65 or older, HHSC must decide within 45 days of receiving the completed and signed application. The deadline can be extended when a delay in certification is approved, and HHSC then has to notify both the applicant and the nursing facility. Ask the facility about its Medicaid-pending policy before admission.

Is Medicaid planning the same as hiding assets?

No. Medicaid planning uses legal strategies within the rules. Hiding assets, lying on applications, or fraudulently transferring property is illegal. Legal planning involves converting countable assets to exempt assets (like prepaying a funeral), using compliant annuities, establishing trusts within the rules, and timing applications strategically. An elder law attorney can help make sure it's done properly.

Next Steps

If nursing home care is on the horizon, the time to plan is now, not after admission. The five-year look-back means financial decisions made today affect Medicaid eligibility years from now. To start, apply online at Your Texas Benefits, or call 2-1-1 Texas for general health-and-human-services information and a referral. If your loved one has assets above the limit or made transfers in the past five years, talk to an elder law attorney before you apply.

Your Texas Benefits Apply for Texas Medicaid long-term care online. www.yourtexasbenefits.com
2-1-1 Texas General health-and-human-services information and referral. 2-1-1
National Academy of Elder Law Attorneys Find a certified elder law attorney near you. www.naela.org

Learn More

MedicaidNursing Home Medicaid by State: Coverage, Eligibility, and CostMedicaid pays for nursing-home care in every state, but the income cap, level-of-care test, and rules vary. The federal floor, what changes, and your state. MedicaidTexas Medicaid Programs for SeniorsTexas Medicaid programs for seniors 65+ include STAR+PLUS, CAS, HCBS waivers, and PACE. Find out what each one covers, who qualifies, and how to enroll. MedicaidTexas Medicaid Spend-DownTexas allows no income spend-down for long-term care. As an income-cap state it uses a Qualified Income (Miller) Trust. See the 2026 income and asset rules. MedicaidTexas STAR+PLUS Waiver ProgramTexas STAR+PLUS covers Medicaid managed care for seniors 65+. The HCBS income limit is $2,982/month, and 12,100 people were on its interest list in August 2026. MedicaidWhat Texas Medicaid CoversTexas Medicaid covered services for seniors 65+: doctor visits, hospital care, drugs, vision, limited dental. See what STAR+PLUS covers and what it won't. MedicaidHow to Apply for Texas MedicaidHow to apply for Medicaid in Texas in 2026: the four ways to apply, the documents seniors need, the income-cap trap, timelines, and where to get free help. CaregiverHow to Get Paid as a Family Caregiver in TexasLearn how to get paid as a family caregiver in Texas through Medicaid CDS, CAS, VA programs, and CMPAS. Covers pay rates, eligibility, and step-by-step process.

Find personalized help applying for Texas Medicaid long-term care 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.

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