In Tennessee, Medicaid for nursing-home and in-home long-term care runs through TennCare CHOICES. For 2026, an applicant's income generally can't exceed $2,982 a month, unless a Qualified Income Trust is used. Countable belongings can't exceed $2,000, and the home where the person lives doesn't count. TennCare looks back five years at gifts and below-value sales.
Most people facing a nursing-home admission in Tennessee come to this question in the middle of something hard. A mother may have just left the hospital and can't go home. A husband's care may now be more than his wife can manage alone. The family is trying to work out how care will be paid for, whether the house can stay in the family, and what the spouse who stays home will have to live on. This page sets out how TennCare's long-term-care rules work, using the state's own published figures, so those questions can be weighed calmly.
What Tennessee Medicaid Planning Covers — and Why It Differs From Other States
TennCare CHOICES is Tennessee's Medicaid program for long-term services and supports. According to TennCare's CHOICES page, it serves two groups who are eligible for needed care:
- older adults age 65 and older
- adults age 21 and older with physical disabilities
It covers home and community-based services, which help a person live at home or in the community and assist with daily living activities. When needed, it also covers care in a nursing facility as an alternative to those services.
CHOICES groups
Every CHOICES member is assigned to one of three groups (1, 2 and 3), and each group provides specific services based on the person's needs. CHOICES Group 1 is for people of all ages who receive nursing-home care. TennCare's CHOICES page names Groups 2 and 3 without describing them in the text quoted here; TennCare's Estate Recovery page refers to a Group 2 member receiving care in the home. The services in each of those groups depend on Tennessee's current rules.
Need for care, not only finances
Financial limits are only part of eligibility. TennCare's CHOICES page describes the program as serving people who are eligible for needed long-term services and supports, and it lists receiving SSI payments or qualifying for Medicaid long-term services and supports among the requirements. TennCare's Resource Assessment policy also refers to an approved PAE for home and community-based cases. The clinical or functional standards TennCare applies to decide whether a person needs that level of care are not set out on this page; they depend on Tennessee's current rules.
Federal framework, state program
Federal law sets the framework every state follows. The rules on estate recovery and asset transfers sit in 42 U.S.C. § 1396p, and the protections for a married couple sit in 42 U.S.C. § 1396r-5. Each state then runs its own program. That is why Tennessee's figures and procedures are not the same as those in, say, Texas long-term-care Medicaid or Colorado Medicaid planning.
Medicaid planning means arranging a family's finances so the person needing care meets TennCare's eligibility rules. It also means keeping what the law allows a spouse or family to keep. It works within the rules and depends on the family's own facts.
TennCare CHOICES Eligibility: Countable Assets, Income, and the Asset Limit
TennCare's resource standard for Institutional Medicaid is $2,000, as TennCare's Institutional Medicaid policy states. A countable asset is a resource the program adds up and measures against that limit. The resources of an applicant's spouse may be deemed available to the applicant. That policy also requires every applicant who has a spouse to have a Resource Assessment completed before an eligibility decision is made.
The home is the clearest exclusion. TennCare's Countable and Excluded Resources policy lists these conditions for the home:
- it is the principal place of residence of the applicant, the spouse or dependent relatives
- for someone in a long-term-care facility, intent to return home is established
The exclusion has a ceiling. An institutionalized person is ineligible for CHOICES long-term-care payments when home equity exceeds $752,000, unless certain people lawfully live in the home. Federal law sets the same kind of bar, lifted when a spouse, a child under 21, or a blind or disabled child lives there. The equity limit can also be waived if undue hardship is requested and found. Undue hardship means the limit would endanger the person's health or life by depriving them of medical care, or would deprive them of food, clothing, shelter or other necessities. Whether other belongings are excluded depends on Tennessee's current rules in that same policy.
Income is tested separately. TennCare uses the Medicaid Income Cap, which is 300% of the SSI Federal Benefit Rate. That figure is $2,982 a month for 2026, and it changes each year. If gross income is above the cap, the person can set up a Qualified Income Trust, also called a Miller Trust. This is a trust used only to establish Medicaid eligibility, and the person places certain monthly income into it.
The Look-Back Period and How Tennessee Applies Transfer Rules
TennCare's look-back period is sixty months for all resource transfers made on or after February 8, 2006, according to TennCare's Transfer of Assets and Penalty Periods policy. The look-back period is the window TennCare reviews for assets given away or sold for less than fair market value. The federal rule is also 60 months for transfers on or after that date. Medicaid.gov's eligibility page describes it as the five-year period before the application.
TennCare treats the uncompensated value of a transfer as available when it decides eligibility. The uncompensated value is the asset's equity value minus whatever the person received for it. A transfer for less than fair market value creates a penalty period. A penalty period is a stretch of time during which an otherwise eligible person can't receive TennCare payment for nursing-facility care or home and community-based services.
The penalty's length is tied to the uncompensated value. TennCare measures it against its average cost of nursing-facility care. From January 1, 2026, that cost is $295.87 a day, or $8,846.10 a month. The result is a number of days of ineligibility, and eligibility can't begin until the full number of days has passed.
Under federal law, the penalty starts on the later of two dates: the month of the transfer, or the date the person is eligible and would otherwise be receiving institutional-level care. A gift made four years ago is therefore penalized the same way as one made last month, as long as it falls inside the look-back. Federal law also places no transfer penalty on a transfer to the person's spouse.
TennCare's policy lists other circumstances that are not treated as transfers for less than fair market value. Which of those apply depends on the facts and on Tennessee's current rules.
Spousal Protections Under TennCare: What the Community Spouse Keeps
For a married couple, the spouse who stays home is often the one with the most to lose. That is the reason federal law, at 42 U.S.C. § 1396r-5, sets out separate protections.
The community spouse is the husband or wife who remains at home while the other spouse receives institutional care. The community spouse resource allowance (CSRA) is the share of the couple's countable resources the community spouse may keep. Tennessee calls it the CSRMA.
Resources
Under TennCare's Resource Assessment policy, the assessment counts all countable resources owned by either spouse or by both together. Only one assessment is completed per couple. For a snapshot date in 2026, the CSRMA is one-half of total countable resources, but not less than $32,532 and not more than $162,660 (as of January 2026). Federal law lets the institutionalized spouse transfer resources up to the allowance to the community spouse, or for that spouse's sole benefit, without a transfer penalty. Once eligibility is established, the community spouse's resources are generally not counted against the institutionalized spouse.
Income
Income works differently. Federally, while a spouse is in an institution, the community spouse's income is generally not deemed available to that spouse. The minimum monthly maintenance needs allowance (MMMNA) is the minimum monthly income the community spouse is allowed to keep. Federally it changes each July 1, while the maximum income allowance and the resource figures change each January, as the 2026 CMS spousal impoverishment bulletin explains. This page does not state an MMMNA dollar figure. Tennessee's own MMMNA figure, and the date it applies from, depend on Tennessee's current rules.
As set out earlier, the home stays excluded while it is the spouse's principal residence. That is a rule about eligibility. It is not a promise about any particular asset.