Married Couples and Medicaid: How the Healthy Spouse Can Avoid Financial Devastation
The cost of long-term care can quickly become one of the largest financial burdens faced by an older married couple. In Florida, skilled nursing facilities can cost between $15,000 and $20,000 per month for an individual, while assisted living facilities may cost approximately $5,000 to $8,000 per month.
At these rates, even couples with substantial savings can see a lifetime of accumulated assets depleted rapidly.
Fortunately, Florida Medicaid law contains important protections for married couples when one spouse requires long-term care. With appropriate planning, a married applicant may be able to qualify for Medicaid without requiring the spouse who remains at home to become impoverished.
The rules are complex, however, and strategies that work for one couple may be inappropriate for another. Florida’s Department of Children and Families (DCF) determines financial eligibility for most aged and disabled applicants, while the Agency for Health Care Administration (AHCA) administers Florida’s Medicaid program. For long-term-care Medicaid, an applicant must satisfy both financial and medical eligibility requirements.
Several financial planning techniques may be available to married Florida residents seeking long-term-care Medicaid, including an important and sometimes overlooked strategy known as spousal refusal.
Understanding the Spousal Impoverishment Rules
When one spouse requires institutional or certain long-term-care Medicaid services and the other remains in the community, Medicaid generally refers to them as the institutionalized spouse and the community spouse.
At the time of application, Medicaid does not simply examine assets titled in the applicant’s name. Florida generally considers the couple’s combined countable assets when determining eligibility. An account titled solely in the community spouse’s name is not necessarily excluded from consideration.
Federal and Florida law nevertheless provide substantial protection for the community spouse through the Community Spouse Resource Allowance (CSRA).
As of 2026, Florida’s published CSRA is $162,660. The standard asset limit for an individual applying for Institutional Care Program (ICP), Home and Community-Based Services (HCBS), or Hospice Medicaid is generally $2,000. Florida’s April 2026 financial standards also list the long-term-care Medicaid income cap at $2,982 per month for an individual. These figures are indexed and change periodically.
In a conventional eligibility case, the community spouse may generally retain the CSRA while the applicant’s remaining countable resources must be reduced to the applicable individual resource limit.
Importantly, this does not necessarily mean excess assets must be given away or spent on nursing-home bills.
Spending Down Assets — But Spending Them Wisely
One of the simplest Medicaid planning strategies is a lawful spend-down of countable assets. The objective is to convert excess countable resources into expenditures or assets that do not prevent Medicaid eligibility.
Depending on the circumstances, a married couple may use excess funds to pay legitimate expenses such as:
- Outstanding debts
- Home repairs or improvements
- Replacement of an automobile
- Medical and dental expenses
- Household expenses
- Legal fees
- Certain funeral or burial arrangements
For example, assume a couple has $200,000 in countable assets. Simply paying nursing-home expenses until the couple reaches the Medicaid resource limit may be economically inefficient. Depending on their circumstances, it may be preferable to use some of those funds for legitimate expenditures benefiting either spouse while restructuring the remaining assets in accordance with Medicaid rules.
The critical distinction is between spending assets for fair value and giving assets away.
Medicaid’s transfer rules can impose a period of ineligibility when assets are transferred for less than fair market value during the applicable look-back period. Florida imposes a five-year look-back on the gifting of assets. When an individual is ready to file a Medicaid application, Medicaid will review the preceding five years to determine whether assets were gifted or transferred for less than fair market value in order to become financially eligible.
Florida specifically requires transfers during the look-back period to be evaluated to determine whether the transfer was legally binding, whether ownership was retained, and whether fair compensation was received.
As a result, indiscriminate gifting to children or other family members during the five years before applying for Medicaid can create serious eligibility problems.
There is, however, an important exception involving transfers between spouses.
Transfers Between Spouses
When it comes to the five-year look-back, transfers between spouses receive special treatment.
Florida Medicaid policy expressly provides that a transfer of assets between spouses does not affect eligibility. This makes interspousal transfers an important component of Medicaid planning.
Once Medicaid eligibility has been established, assets constituting the community spouse’s allowance that remain titled in the institutionalized spouse’s name should generally be transferred to the community spouse within the required period. Florida policy recognizes these transfers and provides that no transfer penalty is imposed for transferring the community spouse’s allocated assets to that spouse.
For example, consider a husband and wife who own a home and have a jointly held brokerage account containing $150,000. If the husband needs to enter a skilled nursing facility, the couple may be able to transfer ownership of the brokerage account to the wife. Because transfers between spouses do not violate the five-year look-back and the wife’s total countable assets remain below the CSRA, this transfer can be an important part of establishing the husband’s Medicaid eligibility.
But what happens when the community spouse’s assets exceed the CSRA?
Florida offers another potential planning strategy.
Spousal Refusal: A Powerful Florida Medicaid Strategy
One of the most significant planning options for married Florida Medicaid applicants is spousal refusal.
The concept may initially sound counterintuitive because Medicaid ordinarily considers both spouses’ assets when one spouse applies for institutional Medicaid. Florida’s policy manual states that assets belonging to both spouses are considered when determining initial institutional eligibility.
Florida policy, however, creates an important exception.
When the community spouse, after declaring and verifying his or her assets, refuses to make those assets available to the institutionalized spouse, the institutionalized spouse may assign his or her rights of support to the State and obtain institutional-care Medicaid benefits.
When this strategy is used, Medicaid no longer imposes the Community Spouse Resource Allowance on the community spouse. This means the spouse remaining at home may be able to retain assets exceeding the traditional CSRA limit.
This is the foundation of Florida spousal refusal planning.
Consider a simplified example. Suppose a husband requires nursing-home care while his wife remains at home. Their combined countable assets total $500,000 in jointly held funds, substantially exceeding the amount ordinarily protected under the CSRA.
Rather than spending down the excess assets, the couple could transfer the jointly owned funds into accounts owned solely by the wife. Because transfers between spouses are exempt from the five-year look-back penalty, this transfer itself does not create a transfer penalty.
Once the wife is the sole owner of the assets, she may use the spousal refusal strategy and refuse to make those assets available to her husband. The husband then assigns his rights of support against his wife to the State of Florida.
By employing spousal refusal, the wife’s assets may no longer be counted when determining the husband’s financial eligibility, potentially allowing him to qualify for Medicaid without spending down those assets or waiting five years.
The Tradeoff Associated With Spousal Refusal
Spousal refusal is powerful, but it is not equivalent to Medicaid simply ignoring the community spouse’s assets.
By assigning the institutionalized spouse’s support rights to the State, the applicant permits the State to step into the applicant’s position concerning those support rights. That potential consequence must be carefully evaluated before employing the strategy.
There is another important consideration. Florida policy states that a community spouse who refuses to make assets available is not entitled to a community spouse income allowance, although the institutionalized spouse may allocate available income to the community spouse under applicable rules.
The financial analysis should therefore compare the value of protecting excess assets through spousal refusal against the loss of the community spouse income allowance and the potential consequences associated with assigning support rights to the State.
Spousal refusal is best viewed as a sophisticated planning tool rather than a routine solution whenever a married couple has excess resources.
Protecting the Healthy Spouse Requires Careful Planning
Marriage creates both challenges and opportunities when seeking Florida Medicaid long-term-care benefits. Although Medicaid initially considers the resources of both spouses, the law contains substantial protections designed to prevent the community spouse from becoming impoverished.
Those protections may include the Community Spouse Resource Allowance, income allowances, lawful spend-down strategies, transfers between spouses and, in appropriate cases, spousal refusal.
Spousal refusal is particularly noteworthy because, in the right circumstances, it may preserve significantly more of a married couple’s assets than a traditional spend-down.
The strategy must nevertheless be approached carefully. Medicaid rules distinguish between asset ownership, asset availability, transfers, income and support obligations, and financial standards change periodically.
Before implementing a Medicaid planning strategy, a couple’s assets, income, property ownership, prior transfers and long-term-care circumstances should be carefully reviewed.
If you or your spouse is facing the possibility of long-term care, the attorneys at Shalloway & Shalloway can help you understand how Florida Medicaid rules may apply to your family and evaluate planning strategies designed to protect both eligibility and financial security. Contact our office to schedule a consultation.