You may be surprised to hear that 52 percent of seniors will need some form of paid long-term care eventually. Moreover, just over one third will reside in nursing homes. The cost for a year in a nursing home in the Staten Island area is in the vicinity of $170,000, so this reality should be on your radar.
It’s difficult for most people to come up with this type of money late in their lives. Everything you have worked for could eventually wind up in the coffers of a nursing home, and this is the major elder law issue that attorneys address.
Medicare Won’t Help
Medicare does not pay for long-term care, so you have to look elsewhere for some type of solution. Long-term care insurance does exist, but it’s quite expensive if you get the coverage when you are a senior citizen.
Even though a significant percentage of elders require paid care, nearly half of them do not, so you may be paying for something you’ll never use. Plus, there is a waiting period that will enter the picture if you make a claim. You have to pay out of pocket during that interim.
Plus, they can raise the premiums along the way, so the value of the coverage is questionable.
Medicaid Eligibility
The Medicaid program will cover long-term care if you can gain eligibility. Since it is a need-based benefit, there is a $31,175 asset limit in New York.
This limit does not include the value of your home, but there is a $1.097 million equity limit. Other non-countable assets include your wedding ring, engagement ring, heirloom jewelry, one motor vehicle, personal effects, and household items.
Unlimited term life insurance and $1500 of whole life insurance can be carried, and you can have $1500 saved for final expenses. If you have a prepaid burial plot, Medicaid will not consider its value.
Allowances for a Healthy Spouse
In many cases, a person will apply for Medicaid to pay for nursing home care while their spouse is still capable of independent living. Under these circumstances, there are two allowances for the healthy spouse.
They can keep half of the countable assets up to a certain limit. This is called the Community Spouse Resource Allowance. During the 2025 calendar year, it is $157,920 in New York.
Income that is brought in by the spouse that is applying for Medicaid must be contributed toward the cost of the care. This requirement is not enforced if a healthy spouse is relying on the income because of financial need.
They can qualify for a Monthly Maintenance Needs Allowance which gives them the ability to continue to accept the income. There is a maximum limit, and it stands at $3,948 this year.
Home Ownership and Medicaid Estate Recovery
There is a Medicaid estate recovery mandate. The program must seek reimbursement from your estate after you pass away if you were using Medicaid to pay for long-term care.
Your home is the only truly valuable asset that would be on the table because of the limits. If a healthy spouse, a blind or disabled child, or a minor is residing in the home, it would be protected during the Medicaid recovery phase.
In addition to this exception, there is a child caregiver exemption. You can give your home to an adult child if they have been living with you providing a level of care that has enabled you to stay out of a nursing home. Medicaid would not attempt to attach the home after your passing.
Irrevocable, Income Only Medicaid Trust
To transfer countable assets out of your name, you can establish an irrevocable, income only Medicaid trust. If you do this, you would have no access to the principal going forward, but you could accept distributions of the trust’s earnings.
Advance planning is the key to the successful execution of the strategy. The trust must be funded at least 60 months before you attempt to gain Medicaid eligibility.
Contact a Staten Island Elder Law Attorney!
If you are ready to work with a Staten Island, NY elder law attorney to develop a nursing home asset protection plan, our doors are open. You can send us a message to set up a consultation appointment, and we can be reached by phone at 332-456-0500.
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