Few transitions in life feel as difficult as the moment when one spouse needs to move to a care community while the other remains at home. Perhaps one partner is living with advanced dementia and needs the security of memory care, while the other is still active and independent. Or maybe a stroke or chronic illness has created care needs that can no longer be safely managed at home, despite the spouse’s best efforts.

These situations bring a complicated mix of emotions, including grief over changing roles, worry about separation, and uncertainty about the future. Layered on top of these feelings is a pressing financial concern: How do we approach funding senior care without leaving the spouse who lives at home unable to afford basic living expenses?

The good news is that financial protections exist specifically to address this scenario, particularly when Medicaid is involved. Understanding how income and assets are evaluated when only one spouse needs care, and knowing which funding options may be available, can provide both practical direction and much-needed peace of mind during an already stressful time.

Medicaid rules that protect the spouse at home

When one spouse needs to move to a nursing home or, in some states, to assisted living through a Medicaid waiver program, special rules help protect the financial security of the spouse who remains at home (referred to as staying in the community, meaning their local community as opposed to a senior living community). In Medicaid terminology, this person is called the “community spouse,” while the person entering care is the “institutionalized spouse.”

What care settings do these protections apply to? Community spouse protections primarily apply when one spouse enters a nursing home and needs Medicaid to help pay for that care. In states that offer Medicaid waiver programs covering assisted living or memory care, some of these protections may also apply, though the rules can differ. These protections generally do not apply to independent living or other residential settings that don’t qualify for Medicaid long-term care coverage.

The core principle behind these protections is preventing “spousal impoverishment,” the idea that paying for one spouse’s care shouldn’t leave the other spouse destitute. Without these rules, couples would need to spend nearly all their joint savings before Medicaid would help, potentially leaving the community spouse with almost nothing to live on.

Instead, Medicaid’s spousal impoverishment protections allow the community spouse to keep a protected amount of the couple’s joint assets and income. Two key terms define these protections:

• The Community Spouse Resource Allowance (CSRA) is the amount of the couple’s combined countable assets that the community spouse can retain without affecting the institutionalized spouse’s Medicaid eligibility. For 2025, federal guidelines set this range between approximately $31,584 (the minimum) and $157,920 (the maximum), though the exact amount varies by state. Some states automatically allow the maximum, while others calculate it based on half of the couple’s combined countable assets, up to that maximum.
• The Minimum Monthly Maintenance Needs Allowance (MMMNA) protects the community spouse’s income. If the community spouse’s own income falls below a certain threshold (approximately $2,644 to $3,948 per month, depending on the state), they may be entitled to some or all of their institutionalized spouse’s income to reach that minimum level. This ensures that the community spouse has an adequate monthly income to maintain their household.

These protections make a significant practical difference. Instead of spending down to near-poverty levels, a couple can preserve substantial resources for the community spouse’s ongoing living expenses, home maintenance, and future needs, while still qualifying the institutionalized spouse for Medicaid coverage. These rules are central to funding senior care in a way that safeguards both partners’ needs.

Paying for senior care: Funding and benefit options to explore

Beyond Medicaid’s spousal protections, several funding sources may help cover care costs when one spouse moves to a community. Most families use a combination of these options over time, and understanding them is an important part of funding senior care responsibly and sustainably.

Private savings or retirement income

Many couples initially pay for care using savings, retirement accounts, Social Security benefits, and pensions. When both spouses have their own income streams, families can often dedicate one spouse’s income toward care costs while the other spouse’s income covers household expenses at home.

This arrangement can work well in the short term, though it may not be sustainable indefinitely if care costs significantly exceed one spouse’s income. For example, if assisted living costs $5,000 monthly but the spouse needing care receives only $2,500 in Social Security benefits, the couple must cover the $2,500 gap from savings or other income, a strategy that works until their savings deplete to levels where Medicaid eligibility becomes relevant.

Veterans benefits (Aid and Attendance)

The VA’s Aid and Attendance benefit can provide additional monthly income to help pay for care, and it applies in situations where one spouse needs care while the other remains at home. This benefit is available to qualifying wartime Veterans or their surviving spouses who need help with daily activities.

Importantly, when one spouse is a Veteran and the other needs care, the Veteran may claim Aid and Attendance benefits on behalf of their spouse. Similarly, if the Veteran needs care and has a spouse at home, the benefit amount may be higher than for a single Veteran, recognizing the need to support both the Veteran and the dependent spouse.

This benefit considers household income and medical expenses, so families paying significant care costs may qualify even with moderate retirement income.

Long-term care insurance

If one or both spouses purchased long-term care insurance years ago, this can be a significant help. These policies typically pay a daily or monthly benefit when the insured person needs assistance with activities of daily living, regardless of the care setting, whether in a nursing home, assisted living, memory care, or even at home.

When only one spouse has a policy, that insurance covers their care costs, preserving more of the couple’s joint assets and income for the community spouse’s needs. Some policies also include inflation protection or shared benefits between spouses, which can extend coverage considerably.

Medicaid

For many couples, Medicaid eventually becomes necessary when care costs exhaust other resources. When one spouse applies for Medicaid, eligibility is determined using special rules that account for the couple’s marital status.

Rather than treating each spouse’s income and assets separately, Medicaid looks at the couple’s combined resources, then applies the community spouse protections described earlier. This means the community spouse can retain protected amounts of both assets and income, while the institutionalized spouse can qualify for Medicaid even though the household as a whole has resources above the typical individual eligibility limits.

The application process requires substantial documentation, financial records, asset statements, proof of income, and medical evaluations, and the rules around asset transfers and look-back periods are complex. However, the protections built into the system specifically for married couples can make Medicaid a viable option for funding senior care without impoverishing the spouse who remains at home.

Where to find reliable help

Navigating these financial decisions while managing the emotional challenges of separation and changing care needs can feel overwhelming. You don’t have to figure it all out alone.

Contact your local Oasis advisor. Senior care advisors understand the local care landscape and can help you identify communities that fit both your loved one’s care needs and your family’s financial situation. They can explain which communities work with different payment sources, including Medicaid, and guide you through the process of finding appropriate care. Find your local Oasis advisor to get personalized support during this transition.

Consult an elder law attorney. If Medicaid eligibility is a concern, either now or in the foreseeable future, working with an elder law attorney who specializes in Medicaid planning is invaluable. These attorneys understand your state’s specific rules, can help you navigate community spouse protections, ensure you’re maximizing allowable asset retention, and guide you through the application process to avoid costly mistakes.

The situation you’re facing is difficult, but resources and protections exist to help you secure necessary care for one spouse while preserving financial stability for the other. With the right information and support, you can make decisions that honor both partners’ needs during this challenging chapter.