Virginia Medicaid Personal Needs Allowance (2026): What You Keep

If your loved one lives in a Virginia nursing home on Medicaid, they keep a Personal Needs Allowance of $40 a month for their own use.1 The Virginia Medicaid Personal Needs Allowance is the small slice of monthly income that stays with the resident instead of going to the facility.

In This Guide

• What Is the Virginia Medicaid Personal Needs Allowance?
• Virginia Medicaid Personal Needs Allowance vs. the Federal Floor
• How the Money Is Held: The Resident Trust Fund
• Where the Allowance Fits in Your Patient Pay
• What the Facility Must Provide Without Touching Your Allowance
• Veterans and the VA Pension Rule
• Frequently Asked Questions
• Learn More

What Is the Virginia Medicaid Personal Needs Allowance?

When someone qualifies for Medicaid to cover nursing-facility care, they no longer pay the home out of pocket the way a private-pay resident does. Instead, Medicaid pays the facility, and the resident contributes nearly all of their own monthly income toward the cost of that care. That contribution is called the patient pay, or patient liability, and for most residents it swallows almost the entire Social Security or pension check.

Federal law does not let it swallow everything. Every resident gets to keep a small, protected amount each month for the ordinary expenses of daily life, things Medicaid and the facility don't cover: a haircut, clothing, snacks, stamps and greeting cards, a phone plan, a magazine subscription, a small gift for a grandchild. That protected amount is the Personal Needs Allowance. It is deducted from the resident's income before the patient pay is figured, so it never reaches the facility at all.

Who gets it? Any resident whose long-term care is paid by Virginia Medicaid in a nursing facility. The program in Virginia is Cardinal Care, run by the Virginia Department of Medical Assistance Services (DMAS), with applications taken at the local Department of Social Services.1 The allowance isn't something a family applies for separately, it's built into the way DMAS calculates what a resident owes the facility each month.

Without this rule, a resident's entire income would go to the nursing home, and they would have nothing of their own, no way to buy a birthday card, replace a worn pair of shoes, or pay for a haircut the facility doesn't provide. The allowance is modest, but it protects a person's ability to make small choices about their own life.

Virginia Medicaid Personal Needs Allowance vs. the Federal Floor

Here's how Virginia's figure compares to the national minimum. Federal law sets a floor, not a fixed amount: under 42 U.S.C. 1396a(q) and 42 CFR 435.725, a state must let an institutionalized individual keep at least $30 per month, and at least $60 a month for a couple if both spouses are aged, blind, or disabled.2 That $30 figure has not moved since the Omnibus Budget Reconciliation Act of 1987 set it, effective July 1988, and Congress has never indexed it to inflation.

States are free to set their allowance higher than the floor, and Virginia sits just above it. A single aged, blind, or disabled resident in a Virginia nursing facility keeps $40 per month, and a couple with both spouses in a facility keep $60 per month between them.1 Virginia's figure is written into the state's administrative code at 12VAC30-40-20, the rule that governs how income is treated after eligibility is established.

So Virginia's allowance clears the federal minimum by ten dollars for an individual. It's a small margin, and it's worth being realistic with families about what $40 stretches to in 2026. It covers the essentials the facility doesn't, but it isn't meant to fund anything large. That's part of why the resident trust fund rules below matter so much, an unspent balance can quietly build up and create its own problem.1

How the Money Is Held: The Resident Trust Fund

Once the allowance is set aside from a resident's income, the money has to live somewhere. Most nursing facilities hold it in what's called a resident trust fund, a personal-funds account the facility manages on the resident's behalf. Federal rules at 42 CFR 483.10(f)(10) govern how that has to work, and they are strict, because the money belongs entirely to the resident.

Here's what to know. First, the facility cannot require a resident to deposit personal funds with it, a resident has the right to manage their own money, and can keep it in a personal bank account if they prefer.3 If the resident does ask the facility to hold the funds, the facility becomes a fiduciary and has to follow a set of protections:

• Any balance over $50 for a Medicaid resident must be kept in an interest-bearing account, separate from the facility's own operating accounts, and the interest belongs to the resident.3
• The facility must keep a full, separate accounting with no commingling of resident funds and facility funds.
• It must give the resident a statement of the account every quarter, and make the record available on request.
• It must secure the funds with a surety bond or another assurance acceptable to the federal government.
• When a resident dies, the facility has 30 days to turn over the balance and a final accounting to whoever is handling the estate.

For a family, the practical takeaway is simple: you are entitled to see this account. Ask for the quarterly statement, keep it, and reconcile it against what you know the resident actually bought. Any charge you can't explain is worth a question, because these accounts are exactly where mishandling shows up.3

Where the Allowance Fits in Your Patient Pay

To see why the allowance matters in dollars, it helps to walk through how Virginia figures a resident's monthly patient pay. The state starts with the resident's gross income, then subtracts a series of protected amounts before whatever is left goes to the facility. The Personal Needs Allowance is the first of those deductions.

In rough order, DMAS takes the resident's gross monthly income and subtracts:

1. The $40 Personal Needs Allowance.1
2. An income allowance for a spouse still living in the community, if there is one, under Virginia's spousal impoverishment rules.1

What remains after those deductions is the patient pay, the amount the resident owes the facility each month. Medicaid covers the rest of the bill.

Those two are the deductions Virginia's post-eligibility rules set out by amount for a nursing-facility resident. A particular case can carry others, and whether a given expense comes off the top, a Medicare Part B or Medigap premium, for instance, is not something to assume in either direction. The notice DMAS sends when it sets the patient pay itemizes every deduction it applied, so read that notice against the resident's actual income and ask the caseworker about anything that isn't on it.

The community-spouse piece can shift a large amount of income. When one spouse enters a facility and the other stays home, Virginia lets the at-home spouse keep a monthly income allowance so they aren't left destitute. For 2026, that Minimum Monthly Maintenance Needs Allowance runs from a federal floor of $2,705.00 per month up to a maximum of $4,066.50 per month, with the exact figure depending on the couple's circumstances.5 If you're working through a married couple's numbers, our Virginia spousal impoverishment guide covers that calculation in full.

One more point that trips families up: for nursing-facility coverage, Virginia's main income test is 300 percent of the federal Supplemental Security Income (SSI) benefit rate, a cap of $2,982 per month in 2026. Virginia is also a medically needy state, so an applicant whose income sits above that cap can still qualify for nursing-facility care by spending down to Virginia's medically needy income limit, a much lower figure that is set separately for three locality groups.1 The Personal Needs Allowance sits downstream of all of this: it's what the resident keeps no matter how the rest of the math shakes out.

What the Facility Must Provide Without Touching Your Allowance

A common worry is that the facility will nickel-and-dime the resident's $40 for things that should be included in care.1 Federal law draws a clear line here, and it's worth knowing where that line falls.

Under 42 CFR 483.10(f)(11)(i), a whole category of routine items and services is already covered by the daily rate Medicare or Medicaid pays the facility, and during a covered stay the facility may not charge the resident for them. Because they're paid for through the per-diem, they cannot be billed against the resident's personal funds.6 The list includes:

• Nursing services and personal care, including bathing assistance and help with daily activities
• Meals and nutrition services
• An activities program
• Room and bed maintenance
• Routine personal hygiene items: comb, brush, bath soap, razor and shaving cream, toothbrush and toothpaste, denture adhesive and cleaner, moisturizing lotion, towels and washcloths
• Incontinence care and supplies
• Basic personal laundry, over-the-counter drugs, and routine hair and nail hygiene

The $40 is meant for what falls outside that list, the preferred brand of shampoo instead of the basic one, a salon perm rather than a routine haircut, a phone plan, outings, gifts. If a facility tries to bill the resident's trust fund for something in the covered list, that's a violation, and it's grounds for a complaint. Federal guidance spells out the same protections, so a family raising the issue isn't guessing at the rule.6

Veterans and the VA Pension Rule

Veterans have a special rule worth understanding, because it changes both the size of the pension check and where that money is allowed to go. It applies to the VA pension, the needs-based benefit for wartime veterans with limited income, which is different from VA disability compensation.

Here's how it works. Under 38 U.S.C. 5503(d)(2), when a veteran who has neither a spouse nor a child is covered by Medicaid for nursing-facility care, the VA pension is reduced to $90 per month starting the month after admission.4 That sounds like a cut, and it is. The next paragraph, 38 U.S.C. 5503(d)(3), adds one protection alongside the cap: 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.4 Read it carefully, because it is a rule about what Medicaid pays the home, not a rule about what ends up in the resident's hands.

Neither provision addresses how the capped pension lines up with a state's Personal Needs Allowance. That interaction is set by state post-eligibility rules, and states answer it differently: in some, the pension is kept alongside the state allowance; in others, it counts toward the personal-needs amount rather than adding to it. Virginia's answer is not something this guide can confirm, so plan around neither version. Ask the eligibility worker at your local Department of Social Services, or DMAS, how the capped pension is treated in the patient-pay calculation, and read the notice DMAS sends when it sets the patient pay, which itemizes what was deducted and what was counted as income.

The rule is narrower for married veterans or those with a dependent child, where the pension may be treated differently. A veteran in that situation should check with an accredited Veterans Service Officer and their Medicaid caseworker before assuming how the numbers will land.

Learn More

Find personalized help understanding Virginia Medicaid nursing home 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.