My Parent Makes Too Much for Medicaid But Can’t Afford Care — Now What?
One “no” from Medicaid is not the end. Most families who get help are the ones who kept pushing — and who knew which doors to knock on.
You are in a Facebook group at 9pm, exhausted, typing out your situation to strangers because you do not know where else to turn. Your parent is in assisted living. Their Social Security check barely covers half the bill. You are covering the rest out of your own pocket. You called the Area Agency on Aging. They were no help. You looked up Medicaid. Your parent earns $200 over the income threshold. Denied. You are not out of options. Not even close.
First — Understand Why You Were Told No
Most people applying for Medicaid are applying for regular Medicaid — the kind that covers doctor visits and prescriptions. That program has strict income caps, and if your parent’s Social Security or pension puts them over the line, they do not qualify.
But Long-Term Care Medicaid is a completely different program. And the rules are different.
Long-Term Care Medicaid is designed specifically for people in nursing homes or assisted living who need around-the-clock care. In most states, if the cost of care exceeds your parent’s income, Medicaid will cover the difference — even if that income is technically above the standard threshold. Many families never hear about this distinction. They get one “no” and stop there.
The Options Nobody Told You About
1. Apply for Long-Term Care Medicaid — Not Regular Medicaid
Ask the nursing facility or assisted living admissions counselor specifically about Long-Term Care Medicaid. Many facilities have social workers on staff who help families navigate this. The facility wants to keep your parent there — it is in their interest to help you find funding.
2. Look Into a Miller Trust
If your parent’s income is over the Medicaid cap but not enough to cover care costs, a Miller Trust (also called a Qualified Income Trust) allows the excess income to be funneled into a special account — legally reducing their countable income for Medicaid purposes. Search “Miller Trust” plus your state name to get started.
3. Ask About a Pooled Trust
Similar to a Miller Trust but administered by a nonprofit. Particularly useful for families who do not want to set up their own trust. An elder law attorney or your state’s Medicaid agency website can point you in the right direction.
4. Consult an Elder Law Attorney
This is the single highest-leverage move most caregivers make too late. An elder law attorney specializes in legally restructuring a parent’s finances to qualify for Medicaid — without doing anything improper. One consultation can save tens of thousands of dollars. Many offer free or low-cost initial calls. Look for members of NAELA (National Academy of Elder Law Attorneys) in your state at naela.org.
5. Check If Your Parent Is a Veteran
Veterans — and in some cases surviving spouses — may qualify for VA Aid and Attendance benefits, which can provide hundreds of dollars per month toward care costs. This is completely separate from Medicaid and is overlooked far too often. Call 1-800-827-1000 or visit va.gov.
6. Understand the Spend-Down Strategy
In some states, your parent can legally spend down assets on allowable expenses — prepaid funeral costs, medical equipment, home repairs — to bring countable assets below the Medicaid threshold. An elder law attorney can walk you through exactly what is permitted in your state.
The system is complicated by design. But complicated does not mean closed. It means you need the right map.
No jargon. No confusion. Medicare Parts A through D, the observation status trap, Medicaid eligibility, the look-back period, and more — written for real families, not insurance professionals.
Get the Guide — $27 Did you know you may be able to get paid for caregiving? Get Paid to Care for Your Family →A Note on Insurance Delay Tactics
If your parent has private insurance or a Medicare Advantage plan, be prepared for a fight. Insurance companies requesting the same documentation twice, asking about small bank deposits from months ago, dragging decisions out for months — this is not an accident. Delay is a strategy. They count on families giving up.
If a claim is being unreasonably delayed, you have the right to file a formal appeal. Ask the facility’s social worker or billing department to help — they have navigated this before. If you believe you are dealing with bad faith delays, your state’s insurance commissioner is a resource worth contacting.
Frequently Asked Questions
Regular Medicaid covers medical services like doctor visits and prescriptions, and has strict income caps. Long-Term Care Medicaid is specifically designed for people in nursing homes or assisted living who need around-the-clock care. In most states, if the cost of care exceeds your parent’s income, Long-Term Care Medicaid will cover the difference — even if their income is above the regular Medicaid threshold.
A Miller Trust — also called a Qualified Income Trust — is a legal tool that allows income over the Medicaid threshold to be placed in a special account, legally reducing the person’s countable income for Medicaid eligibility purposes. It is available in most states and must be set up correctly by an attorney. Search “Miller Trust” plus your state name for state-specific information.
An elder law attorney specializes in Medicaid planning, estate planning, and legal strategies to protect assets while qualifying for benefits. They can legally restructure a parent’s finances in ways that dramatically change Medicaid eligibility. One consultation can save tens of thousands of dollars. Find a member of NAELA (National Academy of Elder Law Attorneys) in your state at naela.org.
In many cases, yes. VA Aid and Attendance benefits are available to veterans and in some cases to surviving spouses of veterans. The benefit provides monthly tax-free income that can be used toward care costs, completely separate from Medicaid. Call 1-800-827-1000 or visit va.gov to find out if your parent qualifies.