Medicaid Long-Term Care Eligibility Checklist: A Practical Checklist

Summary. A working checklist for qualifying an applicant for long-term care Medicaid and protecting them once care begins — the inventory, the capacity documents, the resource and income analysis, the lookback review, spousal protections, the verification package, filing, the fair hearing, and estate recovery — plus Medicare appeals, admission agreements, and the abuse response.

For the law, see Elder Law and Long-Term Care. For the full workflow, see Planning and Paying for Long-Term Care.

Phase 1 — The inventory (do this first, always)

Five years of statements for every bank, brokerage, and credit union account — including closed accounts.
Deeds to all real property; mortgage statements; property tax bills.
Life insurance policies with written statement of cash surrender value.
Annuity contracts and any qualified plan or IRA statements.
Pension, Social Security, VA, and any other award letters.
Five years of federal and state tax returns.
Vehicle titles.
Prepaid funeral/burial contract — confirm it is irrevocable.
Safe deposit box inventory.
Debts: mortgages, cards, medical, and any loans to or from family.
Birth certificate, Social Security card, proof of citizenship or qualified immigration status, proof of residence.
Medicare card and all other insurance cards.
Current diagnoses, medications, treating physicians, and hospitalizations in the last two years.

Phase 2 — Capacity documents (while capacity exists)

Durable power of attorney (financial) — immediate, not springing.
Express gifting authority, with limits, if any planning is contemplated.
Express authority to apply for public benefits, create/fund trusts, handle retirement accounts and digital assets.
State statutory form used where one exists (institutional acceptance).
Health care proxy with at least one alternate.
Advance directive, plus an actual conversation.
HIPAA authorization for everyone who may need to speak to providers.
Will reviewed — a community spouse's will must not leave assets outright to an institutionalized spouse; use a testamentary trust.
Beneficiary designations reviewed on every account and policy.
POLST/MOLST where there is serious illness.
If capacity is gone: guardianship/conservatorship evaluated, with limited guardianship and less restrictive alternatives (representative payee, supported decision-making, single-transaction protective arrangement) considered first.

Phase 3 — Resource analysis

Countable resources totaled against the applicant's limit (commonly $2,000; verify state figure).
Exempt resources identified and documented:
- The home (equity limit; intent to return; spouse, minor child, or disabled child residing)
- One vehicle
- Household goods and personal effects
- Irrevocable prepaid funeral/burial contract and burial fund
- Term life insurance; whole life under the face-value threshold
- Income-producing property and property essential to self-support
Resource rules cross-checked against 42 U.S.C. § 1382b and the state's manual.
Jointly held accounts analyzed — presumed available in most states absent contrary proof.
Revocable trust assets counted as available (they are).
Annuities reviewed for countability and for state-remainder-beneficiary requirements.
IRAs and qualified plans: state treatment confirmed (countable in some states, exempt if in payout status in others).

Phase 4 — Income analysis

All income sources listed with gross amounts.
State structure determined: income cap or medically needy.
If income cap and income exceeds the limit: Qualified Income Trust (Miller trust) established, funded monthly, with the state as remainder beneficiary.
Post-eligibility patient pay amount computed: income less personal needs allowance, health insurance premiums, spousal/family allowance, and any allowable medical deductions.
Personal needs allowance amount confirmed for the state.

Phase 5 — The five-year lookback

60 months reviewed from the application date under 42 U.S.C. § 1396p(c).
Every transaction over the state threshold documented and explained. Unexplained withdrawals are presumed uncompensated transfers.
Gifts, including to grandchildren, charities, and churches, identified.
Below-market sales and transfers to trusts identified.
Penalty computed: uncompensated value ÷ state average monthly private-pay rate = months of ineligibility.
Penalty start date understood: the later of the transfer or the date the applicant is otherwise eligible and receiving institutional care — i.e., already in the facility and already broke.
Exceptions screened:
- Transfer to a spouse
- Transfer to a blind or disabled child, or a trust solely for such a child
- Trust for a disabled person under 65
- Home to a minor or disabled child
- Home to a caregiver child (resided 2+ years, provided care that delayed institutionalization) — physician letter, residency proof, and care log required
- Home to a sibling with an equity interest who resided 1+ year
- Transfer made exclusively for a purpose other than qualifying
Hardship waiver evaluated where the penalty endangers health, life, food, clothing, or shelter.
Partial return of transferred funds considered to cure or shorten a penalty.

Phase 6 — The community spouse

Resource assessment requested as of the first day of the continuous institutionalization (the snapshot). Do this early.
Snapshot resources totaled; Community Spouse Resource Allowance (CSRA) computed — generally half, subject to the state's minimum and maximum, per 42 U.S.C. § 1396r-5.
MMMNA computed; income diversion from the institutionalized spouse calculated.
Fair hearing or court order considered to raise the CSRA where income diversion is insufficient.
Spousal transfers (penalty-exempt) executed as needed.
Spousal annuity evaluated — must be irrevocable, non-assignable, actuarially sound, with the state named remainder beneficiary. Verify state treatment.
Spousal refusal considered where the state permits it.
Community spouse's will and beneficiary designations updated (testamentary trust, not outright).
Exempt spend-down evaluated: home repairs, vehicle, irrevocable funeral, debt payoff, dental/vision/hearing.

Phase 7 — The application

Verification package complete (Phase 1), plus explanations for every flagged transaction.
Retroactive coverage period identified (up to three months where eligibility existed; state variations apply).
Application filed; date-stamped copy retained.
Call log started: date, name, what was said.
Every information request answered immediately and in writing, with proof of delivery.
Decision deadline tracked (commonly 45 days; 90 where a disability determination is required).
Facility given written notice that the application is pending; its Medicaid-pending policy obtained in writing.
Waiver program application filed separately if home or assisted living care is sought — waiting list position secured.

Phase 8 — Denial and fair hearing

Notice read for the specific reason and the appeal deadline.
Deadline for benefits continued pending appeal calendared (shorter than the general deadline).
Case file requested from the agency.
Issue identified: exempt asset counted · transfer exception available · penalty miscalculated · valuation error · income allocation error · verification received but not recorded.
Hearing binder assembled with a one-page summary in front.
Documentary proof gathered (closing letters, invoices, physician letters, residency evidence).
Witnesses identified; agency worker prepared for cross-examination.
Judicial review deadline calendared if the hearing is lost.

Phase 9 — Medicare skilled nursing (run in parallel)

Hospital asked in writing on day one: inpatient or observation? (Observation defeats the qualifying-stay requirement.)
Written observation notice reviewed; reconsideration of status requested where clinically supported.
Benefit understood: full payment days 1–20, coinsurance days 21–100, only while skilled care is needed (42 U.S.C. § 1395i-3).
"Plateaued" or "not improving" rejected as a basis — maintenance care to prevent deterioration can qualify.
Notice of Medicare Non-Coverage not discarded; expedited QIO appeal requested (free, decided in about two days, services continue during review).
Demand bill requested where the facility, not Medicare, is making the coverage call.
Further appeal levels calendared: redetermination · reconsideration · ALJ · Appeals Council · federal court.

Phase 10 — The admission agreement

Signed only in a representative capacity ("as agent under power of attorney for ___").
All "responsible party" and guarantor language struck. Third-party guarantees may not be required as a condition of admission.
Arbitration: confirmed optional, explained, and not a condition of admission; declined if optional; rescission period noted.
Bed-hold policy obtained in writing, including readmission to the next available bed after the hold expires.
Written confirmation that the facility accepts Medicaid and the resident may remain in place after converting.
Struck: liability waivers · consent to unspecified treatment · authority over resident funds without accounting · any promise to remove the resident if Medicaid is denied.
Copy of everything signed obtained the same day.

Phase 11 — While in the facility

Care plan meeting attended; copy of the individualized care plan obtained (42 C.F.R. Part 483).
Grievances submitted in writing; copies kept; retaliation watched for.
Long-Term Care Ombudsman contacted early.
Facility-held resident funds statements reviewed.
Transfer/discharge rights known: enumerated grounds only, 30 days' written notice, appeal rights, safe and orderly transfer (42 U.S.C. § 1396r).
Hospital-transfer refusal treated as an involuntary discharge and appealed immediately.
Complaint filed with the state survey agency where care is deficient.

Phase 12 — Elder abuse and financial exploitation response

Records secured before any confrontation.
Report to Adult Protective Services; mandatory reporting duties checked.
Financial institution's elder-fraud unit notified; temporary hold requested where available.
Criminal referral considered.
Power of attorney revoked and all institutions notified in writing; accounting demanded from the former agent.
Civil claims evaluated: conversion · breach of fiduciary duty · undue influence · state elder abuse statute (enhanced damages and fees).
Contemporaneous capacity evaluation obtained where a will, deed, or beneficiary change is at issue.
Undue influence elements documented: isolation · confidential relationship · unnatural disposition · beneficiary procured the lawyer.

Phase 13 — After death

Estate recovery notice expected for a recipient aged 55+ (42 U.S.C. § 1396p(b)).
Deferrals and exemptions screened: surviving spouse · child under 21 · blind or disabled child · qualifying sibling · caregiver child.
Hardship waiver requested where recovery would take an heir's sole income-producing asset or residence.
Claim amount verified — services outside the recoverable categories or before age 55 excluded.
Estate not distributed until the claim is resolved (personal liability risk for the representative).
Any pending personal injury recovery: settlement allocated on the record between medical and non-medical damages per Ahlborn and Wos v. E.M.A..