Alabama Medicaid Long Term Care Eligibility for 2025

Alabama Medicaid Long Term Care Programs

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Alabama remains an income cap state, requiring applicants to meet strict income limits to qualify for Medicaid long-term care benefits. Unlike non-income cap states that allow spending down excess income for care, Alabama requires excess income to be managed through a Qualified Income Trust (QIT).

Alabama Medicaid Programs for Elderly and Disabled Residents

  • Institutional / Nursing Home Medicaid: Covers care in nursing homes, hospitals, and Intermediate Care Facilities for Individuals with Intellectual Disabilities (ICF/IID).
  • Home and Community-Based Waivers (HCBS): Offers services to the elderly, disabled, or those with specific diagnoses to help them remain in the community.
  • SSI-Related Medicaid Programs: Provides benefits for individuals who no longer receive SSI payments but are protected under federal laws.

2025 Eligibility Criteria

  • Residency and Citizenship: Applicants must be Alabama residents and U.S. citizens or have proper immigration status.
  • Medical Institution Requirement: Applicants for Institutional Medicaid must reside in an approved facility for at least 30 consecutive days unless they are SSI recipients.
  • Medical Approval: The nursing facility must submit medical information for Medicaid approval.
  • Income Limits: The income limit for Institutional and HCBS Medicaid is $2,901/month per individual. A $70/month personal needs allowance is excluded.
  • Asset Limits: Applicants must have countable resources under $2,000 as of the first day of the month. For HCBS Waivers, the spouse’s income and resources do not apply.
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Spousal Rules for 2025

  • Income Allocation: If the community spouse’s income is under $2,555/month, they may retain income from the institutionalized spouse to meet this threshold.
  • Resource Retention: The community spouse may retain up to 50% of the couple’s total assets, with a maximum of $157,920 and a minimum of $31,584.
  • Alabama is an “income first” state, meaning spousal resource increases are only considered after factoring in income from the institutionalized spouse.

Exempt Assets

  • Primary residence with an equity limit of $730,000, provided the applicant or a qualifying dependent resides there.
  • One automobile, personal belongings, household furnishings, and burial funds (up to $5,000).
  • Cash surrender value of life insurance policies with a face value under $5,000.

Alabama Medicaid Home Exemption and Look-Back Rules

Alabama enforces a 60-month look-back period to review asset transfers. Transfers for less than fair market value may result in a penalty period. Additionally, while one’s home is usually exempt, it is not protected from the Medicaid Estate Recovery Program (MERP) upon the beneficiary’s death.

How to Apply for Alabama Medicaid

Applications can be submitted online via Alabama Medicaid’s website, by calling 1-800-362-1504, or through local district Medicaid offices. Assistance is available at Area Agencies on Aging (1-800-243-5463) and the Department of Public Health.

Further Resources