Vermont lets a nursing-facility resident on Long-Term Care Medicaid keep a Personal Needs Allowance of $79.93 a month, money that stays with the resident instead of going to the facility. That figure sits at the center of how the Vermont Medicaid Personal Needs Allowance works, and it has held steady since January 2024.

In This Guide

What the Vermont Medicaid Personal Needs Allowance Is, and Who Gets It

When someone moves into a nursing facility and Medicaid pays for that care, they don't hand the facility a rent check. Instead, almost all of their monthly income, Social Security, a pension, an annuity, goes toward the cost of care, and Medicaid covers the rest. If that were the whole story, the resident would be left with nothing of their own. The Personal Needs Allowance is the piece the law protects so that doesn't happen.

Here's how it works. Before the state calculates how much of a resident's income goes to the facility, it sets aside a fixed amount the resident keeps for personal use. In Vermont, that amount is $79.93 a month for a nursing-facility resident on Long-Term Care Medicaid. The money is meant for the small things a facility doesn't supply, a preferred brand of shampoo, a haircut at the on-site salon, stamps, a phone plan, a magazine subscription, a birthday gift for a grandchild, a snack from the vending machine.

Vermont's long-term-care Medicaid runs through Choices for Care, administered by the Department of Vermont Health Access, with eligibility decided by the Department for Children and Families. The allowance applies to residents receiving institutional nursing-facility care under that program. If Choices for Care is instead paying for services at home or in the community, a different and much larger figure applies: that person keeps a community maintenance allowance of $1,483 a month effective January 1, 2026, because Medicaid isn't covering their room and board. The $79.93 in this guide is the institutional number.

One thing to keep in mind about who qualifies for the underlying coverage: Vermont runs two separate income paths, not one. Someone who has lived in a medical institution for at least 30 consecutive days qualifies categorically if their countable income is at or below the institutional income standard, which Vermont sets at $2,982 a month for an individual and $5,964 for a couple effective January 1, 2026. Separately, Vermont is also a medically needy state, so an applicant whose income runs above that can still qualify by incurring enough non-covered medical expenses to spend down to the Protected Income Level, which is $1,375 a month outside Chittenden County and $1,483 a month inside it. A single applicant's countable assets generally have to stay at or below $2,000. If you're still working out whether a loved one qualifies at all, our Vermont Medicaid eligibility guide walks through the income and asset rules in detail.

The allowance isn't a bonus or a discretionary payment. It's a right built into how post-eligibility income is treated, and no facility can talk a resident out of it or fold it into what they pay for care.

How Vermont's Medicaid Personal Needs Allowance Compares to the Federal Floor

Every state has to protect at least a minimum amount, but the minimum is strikingly low. Federal law sets the floor at $30 a month for an aged, blind, or disabled individual in an institution, and $60 a month for an institutionalized couple when both spouses are aged, blind, or disabled. That $30 figure has been fixed in the statute since 1988 and has never been adjusted for inflation.

What the federal rule gives is a floor, not a ceiling. States are free to set their allowance higher, and Vermont does: its $79.93 is more than two and a half times the federal minimum.,

That said, it's worth being honest about what $79.93 stretches to. Vermont's Office of the Long-Term Care Ombudsman, which advocates for nursing-home residents, has pointed out that the state's allowance hasn't budged, and at an average of about $2.60 a day it doesn't leave much room once a resident covers a haircut, a phone bill, and a few personal supplies in the same month. Knowing that going in helps families plan, because it means the allowance usually needs to be spent deliberately rather than treated as spare cash that accumulates.

How Your Money Is Held: The Resident Trust Fund

A resident can manage their own money if they're able to, and no facility is allowed to make them hand their funds over. Federal nursing-facility rules are clear on that point: the facility must not require a resident to deposit personal funds with it, and the resident keeps the right to manage their own financial affairs.

Most residents, though, ask the facility to hold and manage the allowance for them, and that's where the resident trust fund comes in. When a facility agrees to hold a resident's money, it takes on a fiduciary duty, and federal law spells out exactly what that means:

A practical habit that protects families: ask for the quarterly statement in writing and actually read it against your own records of what was bought. If a purchase you didn't authorize shows up, that's the moment to raise it, not months later. And keep an eye on the running balance, because the trust-fund money still counts toward the $2,000 asset limit. If the allowance piles up unspent for a year or two, it can quietly push a resident over the resource limit and put their eligibility at risk, which is another reason the allowance is designed to be used month to month rather than saved.

Patient Share: Where the Allowance Fits in the Math

To see why the Personal Needs Allowance matters so much, it helps to understand what happens to the rest of a resident's income. Vermont calls a nursing-facility resident's contribution to the cost of care their patient share, and the allowance is the first thing carved out before that share is calculated.

The order runs roughly like this. Start with the resident's gross monthly income. Subtract the Personal Needs Allowance of $79.93. Subtract certain health-care costs the resident still pays out of pocket, such as a Medicare Part B premium or a Medigap premium. If there's a spouse still living at home, subtract a spousal income allowance, which under Vermont's spousal-impoverishment rules can bring the at-home spouse's income up to a monthly maintenance figure running from Vermont's standard income allocation of $2,707 to a maximum allocation of $4,066.50 in 2026. Whatever remains is the patient share, paid to the facility each month, and Medicaid covers the gap between that share and the facility's full rate.

So the allowance isn't money added on top of everything else. It's income the state agrees the resident may keep before the rest is spoken for. Without it, that whole check would flow to the facility. For a married couple, the interaction with the spousal allowance can significantly change the numbers, and our Vermont spousal impoverishment guide covers how much the at-home spouse can protect.

What the Facility Must Provide (and Can't Bill to Your Allowance)

One of the most common ways a resident's allowance gets eroded is a facility charging for things it's already being paid to provide. Federal rules draw a firm line here. During a covered Medicaid stay, a set of routine items and services is included in the facility's daily rate, and the facility must not bill the resident for them, which means they can't be charged against the Personal Needs Allowance either.

Those covered items and services include:

  • Nursing services and food and nutrition services
  • An activities program and routine room and bed maintenance
  • Routine personal hygiene items and services, including things like a comb, brush, bath soap, razor, shaving cream, toothbrush, toothpaste, denture cleaner, and moisturizing lotion
  • Incontinence care and supplies, over-the-counter drugs, towels and washcloths, bathing assistance, basic hair and nail hygiene, and basic personal laundry

Because those are built into the per-diem the facility already receives, none of them should ever come out of the resident's allowance. If a facility tries to charge the trust fund for basic soap, a routine haircut framed as required hygiene, or incontinence supplies, that's the kind of charge to question, and the allowance is meant to be spent on preferences and extras, not on care the facility owes as part of the daily rate.

The line isn't always obvious in practice. A basic bar of soap is covered; a resident's insistence on a specific salon shampoo is a personal preference the allowance can cover. A standard haircut tied to hygiene is the facility's responsibility; a color or perm is the resident's choice. When a charge looks like it belongs on the covered list, ask the facility to point to what the resident is actually paying for.

If You're a Veteran: The VA Pension Cap

Veterans on a needs-based Department of Veterans Affairs (VA) pension face a special rule when they enter a Medicaid-paying nursing facility, and it's one families often get wrong. Under federal law, when a veteran who has neither a spouse nor a child is covered by Medicaid for nursing-facility care, no VA pension above $90 a month may be paid for any period after the month of admission. In effect, the pension is capped at $90 once Medicaid is paying for the nursing home.

That cap answers one question and leaves another open. The $90 doesn't flow to the facility: federal law bars a nursing home's Medicaid payment from being reduced because of the pension the veteran is permitted to keep. That is a rule about what the state pays the home, not a rule about what the resident ends up holding alongside a state allowance. Vermont's Personal Needs Allowance is $79.93 a month. Whether the $90 sits on top of that allowance or takes its place is decided by state post-eligibility rules rather than by the VA statute, and states answer it both ways. We haven't confirmed which way Vermont handles it, so don't plan around either answer. Ask the eligibility worker at the Department for Children and Families, or look at the resident's patient-liability notice, which spells out what the state is protecting each month.

The $90 cap applies to a single veteran with no spouse or dependent child. If the veteran is married or has a dependent, the treatment can differ, so it's worth confirming the specifics with both a Veterans Service Officer and a Medicaid eligibility worker rather than assuming the cap applies.

Frequently Asked Questions

How much is Vermont's Medicaid Personal Needs Allowance in 2026?

It's $79.93 a month for a nursing-facility resident on Long-Term Care Medicaid, and $159.85 a month for an institutionalized couple. Vermont sets the figure through its Medicaid post-eligibility rules and publishes it in the state's annual healthcare standards chart. It has not changed since January 2024, when it rose from $72.66.

I get Choices for Care at home, not in a nursing home. Is my allowance $79.93 too?

No. The $79.93 Personal Needs Allowance is the institutional figure. Someone receiving long-term-care services through a home- and community-based waiver setting keeps a community maintenance allowance instead, which Vermont set at $1,483 a month effective January 1, 2026, because Medicaid isn't paying their room and board.

What can the Personal Needs Allowance be spent on?

Personal items and preferences the facility doesn't provide, clothing, a preferred brand of toiletries, haircuts and salon services beyond basic hygiene, phone and internet, postage, snacks, magazines, hobby supplies, and gifts. It is not meant for care the facility already owes as part of its daily rate.

Does the money go to the nursing home?

No. The allowance is the portion of a resident's income the state protects before calculating the patient share. It stays with the resident, held either by the resident or in a facility-managed resident trust fund, while the rest of the income goes toward the cost of care.

Can the facility charge my allowance for soap, laundry, or incontinence supplies?

No. Routine personal hygiene items, basic personal laundry, incontinence care and supplies, and similar routine services are included in the facility's Medicaid daily rate, and the facility can't bill the resident, or the allowance, for them during a covered stay.

My father is a veteran on a VA pension. Does he lose it in a Medicaid nursing home?

He doesn't lose it, but it shrinks. A single veteran with no spouse or child has the VA pension capped at $90 a month after admission to a Medicaid-covered nursing facility, and that $90 doesn't go to the facility, because federal law bars Medicaid from reducing what it pays the nursing home on account of the pension he keeps. What federal law doesn't settle is whether the $90 comes on top of Vermont's Personal Needs Allowance or in place of it. That is a state post-eligibility question, states answer it both ways, and we haven't confirmed Vermont's answer, so ask the eligibility worker at the Department for Children and Families or check the patient-liability notice before counting on a particular monthly total. The treatment can also differ for a married veteran, so confirm the details with a Veterans Service Officer.

What happens to the allowance in the trust fund when a resident dies?

The facility must convey the remaining balance and a final accounting within 30 days to the person or the probate court administering the resident's estate.

Learn More

MedicaidVermont Medicaid: A Guide for Seniors and FamiliesVermont Medicaid (Green Mountain Care) covers seniors through DVHA Choices for Care: $2,000 asset limit, $2,982 income standard, spend-down. 2026 guide. MedicaidVermont Medicaid Eligibility and Income LimitsVermont Medicaid uses spend-down, not a hard income cap. See the 2026 $2,000 asset limit, Choices for Care rules, spousal protections, and how to qualify. MedicaidVermont Medicaid and Nursing Home CareHow Vermont Medicaid nursing home coverage works in 2026: Choices for Care eligibility, the asset limit, what you pay, spousal protections, and estate recovery. MedicaidVermont Medicaid Spousal Impoverishment RulesVermont Medicaid protects the at-home spouse: up to $162,660 in assets and $4,066.50/month in income in 2026, with no Miller Trust required to qualify.

Find personalized help understanding the Vermont Medicaid Personal Needs Allowance 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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