2024 Income & Asset Limits (2024)

Last updated: January 16, 2024

New Jersey Medicaid Long-Term Care Definition

Medicaid is a health care program for individuals with limited financial means. While assistance is provided for persons of all ages, the focus here is on long-term care Medicaid eligibility for New Jersey elderly residents who are 65 years of age and older. In addition to care services in nursing homes, adult foster care homes, comprehensive personal care homes, and assisted living facilities, NJ Medicaid pays for non-medical services and supports to help frail seniors live in their homes. There are three categories of Medicaid long-term care programs for which New Jersey seniors may be eligible.

1) Institutional / Nursing Home Medicaid – An entitlement; anyone who is eligible will receive assistance. Benefits are provided only in nursing homes.

2) Home and Community Based Services (HCBS) – Although New Jersey previously offered HCBS Medicaid Waivers for the aged, the state no longer does. With Waivers, the number of participant slots was limited and waiting lists for services could exist. Currently, long-term care services are provided at home, adult day care, adult family care homes (adult foster care homes), comprehensive personal care homes, and assisted living residences via a managed care system. Unlike with HCBS Waivers, the managed care program does not have enrollment caps, which means there is no waiting list to receive long-term care benefits.

3) Regular Medicaid / Aged Blind and Disabled – An entitlement; persons who meet the eligibility requirements will receive services. Limited long-term care services, such as personal care assistance or adult day care, may be available.

In New Jersey, Medicaid is called NJ FamilyCare, and specific to the elderly, it is called NJ FamilyCare Aged, Blind, Disabled (ABD) Programs. While NJ FamilyCare is state and federally funded, it is administered by the state within federally set parameters. The New Jersey Department of Human Services, Division of Medical Assistance and Health Services is the administering agency.

Income & Asset Limits for Eligibility

The three categories of Medicaid long-term care programs have varying functional and financial eligibility requirements. Further complicating financial eligibility is that the criteria changes annually, varies with marital status, and that New Jersey offers several pathways towards Medicaid eligibility.

The table below provides a quick reference to allow seniors to determine if they might be immediately eligible for long-term care from a New Jersey Medicaid program. Alternatively, one can take the Medicaid Eligibility Test. IMPORTANT: Not meeting all of the criteria does not mean one is ineligible or cannot become eligible for Medicaid in NJ. More.

*All of a beneficiary’s monthly income, with the exception of a Personal Needs Allowance of $50.00 / month, Medicare premiums, and potentially a Needs Allowance for a non-applicant spouse, must go towards nursing home costs. This is called a Patient Liability.
†Based on one’s living setting, a program beneficiary may not be able to keep monthly income up to this level.

Income Definition & Exceptions

Countable vs. Non-Countable Income
Nearly any income from any source that a Medicaid applicant receives is counted towards Medicaid’s income limit. Examples include employment wages, alimony payments, pension payments, Social Security Disability Income, Social Security Income, IRA withdrawals, and stock dividends. Nationally, Holocaust restitution payments are not counted as income. Furthermore, in NJ, the VA Allowance, which is above and beyond the Basic VA Pension, does not count as income.

Treatment of Income for a Couple
When only one spouse of a married couple applies for Nursing Home Medicaid or Home and Community Based Services, only the income of the applicant is counted. This means the income of the non-applicant spouse does not impact the income eligibility of their spouse. The non-applicant spouse, however, may be entitled to a Minimum Monthly Maintenance Needs Allowance (MMMNA) / Spousal Income Allowance from their applicant spouse. The MMMNA is a Spousal Impoverishment Rule and is the minimum amount of monthly income a non-applicant spouse is said to require to avoid poverty.

The MMMNA in NJ is $2,465 (eff. 7/1/23 – 6/30/24). If a non-applicant’s monthly income falls under $2,465, income can be transferred to them from their applicant spouse, bringing their income up to this level. In New Jersey, a non-applicant spouse can further increase their Spousal Income Allowance if their housing and utility costs exceed a “shelter standard” of $739.50 / month (eff. 7/1/23 – 6/30/24). In 2024, a Spousal Income Allowance cannot push a non-applicant’s total income over $3,853.50 / month. This is the Maximum Monthly Maintenance Needs Allowance. More on how the Spousal Allowance is calculated.

Income is counted differently when only one spouse applies for Regular Medicaid / Aged Blind and Disabled; the income of both the applicant spouse and non-applicant spouse is calculated towards the applicant’s income eligibility. Furthermore, there is no Monthly Maintenance Needs Allowance for a non-applicant spouse. More on how Medicaid counts income.

Asset Definition & Exceptions

Countable vs. Non-Countable Assets
The value of countable assets are counted towards Medicaid’s asset limit. This includes cash, stocks, bonds, investments, bank accounts (credit union, savings, and checking), and real estate in which one does not reside. In NJ, IRAs / 401Ks are counted. There are also many assets that are considered exempt (non-countable). Exemptions include personal belongings, household furnishings, an automobile, irrevocable burial trusts, and generally one’s primary home.

Treatment of Assets for a Couple
All assets of a married couple are considered jointly owned. This is true regardless of the long-term care Medicaid program for which one is applying. However, there is a Spousal Impoverishment Provision that permits the non-applicant spouse of a Nursing Home Medicaid or Home and Community Based Services applicant a Community Spouse Resource Allowance (CSRA). In 2024, the community spouse (the non-applicant spouse) can retain 50% of the couple’s assets, up to a maximum of $154,140. If the non-applicant’s half of the assets falls under $30,828, 100% of the assets, up to $30,828 can be kept by the non-applicant.

Medicaid’s Look-Back Rule
New Jersey has a 5-year Medicaid Look-Back Period that immediately precedes one’s date of Nursing Home Medicaid or Home and Community Based Services application. During the “look back”, Medicaid checks to ensure no assets were gifted or sold under fair market value.If this has been done, the Medicaid agency assumes it was to meet Medicaid’s asset limit. Violating the Look-Back Rule, even unintentionally, results in a period of Medicaid ineligibility. The Look-Back Rule does not apply to Regular Medicaid.

The U.S. Federal Gift Tax Rule does not extend to Medicaid eligibility. In 2024, this rule allows one to gift up to $18,000 per recipient without filing a Gift Tax Return. Gifting under this rule violates Medicaid’s Look-Back Period.

New Jersey Medicaid Home Exemption Rules

For home exemption, the Medicaid applicant or their spouse must live in their home. If there is no spouse in the home, there is a home equity interest limit of $1,071,000 (in 2024). Home equity is the value of the home after subtracting any outstanding debt against it. Equity interest is the amount of home equity owned by the applicant. Furthermore, if there is not a spouse in the home, and the Medicaid applicant does not live there, the applicant must have Intent to Return. An Intent to Return will allow the home to be exempt for up to six months. For Regular Medicaid, there is no home equity interest limit. Other exemptions exist.

One home’s is not exempt from Medicaid’s Estate Recovery Program. Following a long-term care Medicaid beneficiary’s death, New Jersey’s Medicaid agency attempts reimbursem*nt of care costs through whatever estate of the deceased still remains. This is often the home. Without proper planning strategies in place, the home will be used to reimburse Medicaid for providing care rather than going to family as inheritance.

Medical / Functional Need Requirements

An applicant for long-term care Medicaid must have a functional need for such care. For Nursing Home Medicaid and Home and Community Based Services, a Nursing Facility Level of Care (NFLOC) is required. Furthermore, some program benefits may require additional eligibility criteria be met. As an example, for home modifications, an inability to safely live at home without modifying the home might be necessary. For long-term care services via the Regular Medicaid program, a functional need with the Activities of Daily Living (ADLs) is required, but a NFLOC is not necessarily required.

Qualifying When Over the Limits

For elderly New Jersey residents, aged 65 and over, who do not meet the financial eligibility requirements above, there are other ways to qualify for Medicaid.

1) Medically Needy Pathway – New Jersey has a Medically Needy Program, also called the Special Medicaid Program, Medically Needy Segment, for persons applying for Regular Medicaid / Aged Blind and Disabled and have income over the Medicaid limit. This program allows persons to become income-eligible for Medicaid services by “spending down” their income on medical bills and health insurance premiums. In 2024, the Medically Needy Income Limit (MNIL) in NJ is $367 /month for an individual and $434 / month for a couple. The “spend down” amount, which can be thought of as a deductible, is the difference between one’s monthly income and the MNIL. In NJ, the “spend down” is calculated for a 6-month period. Once an individual (or couple) have met their “spend down”, they will be income-eligible for the remainder of the period. The Medically Needy Asset Limit is $4,000 for an individual and $6,000 for a couple.

2) Qualified Income Trusts (QIT) – Also called Miller Trusts, QITs offer a way for persons over the Medicaid income limit to still become income-eligible for Nursing Home Medicaid or Home and Community Based Services. In simplified terms, income over Medicaid’s income limit is deposited into an irreversible QIT and is not counted towards the income limit. Irreversible means once the trust has been established, it cannot be changed or canceled. A trustee is named to manage the trust, giving that person legal control of the trust funds, which can only be used for very specific purposes. This includes paying health insurance premiums and medical expenses accrued by the Medicaid beneficiary that are not covered by Medicaid. Furthermore, the state of New Jersey must be listed as the beneficiary upon the death of the Medicaid recipient.

3) Asset Spend Down – Persons who have assets over Medicaid’s asset limit can “spend down” extra assets to qualify for Medicaid. This can be done by spending countable assets on non-countable ones, such as home modifications (i.e., wheelchair ramps, roll in showers, stair lifts), prepaying funeral and burial expenses, and paying off debt. Remember, assets cannot be gifted or sold under fair market value, as doing so violates Medicaid’s Look Back Rule. It is recommended one keep documentation of how assets were spent as proof this rule was not violated.

4) Medicaid Planning – The majority of persons considering Medicaid are “over-income” and / or “over-asset”, but they still cannot afford their cost of long-term care. For these persons, Medicaid Planning exists. By working with a Medicaid Planning Professional, families can employ a variety of strategies to help them become Medicaid-eligible, as well as to protect their home from Medicaid’s Estate Recovery Program. Connect with a Medicaid Planner.

Specific New Jersey Medicaid Programs

New Jersey, like all states, pays for nursing home care. The state also recognizes that providing care for persons in their homes or community can be both less expensive than nursing home care and is preferable for the care recipients and their families. NJ offers the following Medicaid programs that provide such assistance.

1) – Via this managed care program, seniors can receive nursing home care, as well as a variety of care services in their homes, adult family care homes, comprehensive personal care homes, and assisted living residences. Potential benefits may include personal care, light housecleaning, adult day care, home modifications, respite care, and medical alert services.

2) Personal Preference Program (PPP) – Program participants are given a monthly budget to manage their own long-term care needs. Allowable expenses include assistive technologies, home modifications, adult day care, and personal care services. Most interestingly, personal care can be “self-directed” and beneficiaries can choose their own care providers. This includes the ability to hire family members, even spouses.

3) Program of All-Inclusive Care for the Elderly (PACE) – The benefits of Medicaid, including long-term care services, and Medicare are combined into one program. Additional benefits, such as dental and eye care, may be available.

4) Money Follows the Person – Also called I Choose Home in NJ. This federal program helps institutionalized persons who are eligible for Medicaid to transition back home or into the community.

How to Apply for New Jersey Medicaid

New Jersey seniors can apply for FamilyCare Aged, Blind, Disabled Programs online at NJFamilyCare, complete a printed application and return it to one’s county welfare agency, or call 1-800-701-0710 to apply over the phone. Persons can contact their county welfare agency or local Area Agency on Aging office for program questions and application assistance. The application process may vary based on the program for which one is applying.

Applying for Medicaid in New Jersey isn’t always straightforward. This is partly because there are several programs relevant to aging seniors and partly because applicants must be certain they meet the eligibility criteria (discussed above) prior to submitting an application for benefits. Seniors who have income and / or assets greater than the allowable amount(s) should strongly consider Medicaid Planning. This can make the difference between acceptance into a Medicaid program and denial of benefits. Familiarizing oneself with general information about the application process can be helpful.