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Example 7 Peter was institutionalized and determined Medicaid eligible in March of 2002. Janice, Peter's wife, remained in the community. In February 2003, Peter's assets were below $2,000. Peter remained Medicaid eligible and institutionalized through May 2003. In June 2003, Peter left the nursing home and joined Janice in their home in the community. His Medicaid eligibility ended on June 30, 2003. In August 2003, Peter inherited $100,000. In September 2003, Peter's condition worsened and he was institutionalized again and applied for Medicaid. All spousal impoverishment rules would be applied to Peter's September 2003 application. His eligibility would be based on a joint asset test, and, if eligible, he would have 12 months to transfer assets in his name that exceed $2,000 to his wife. 18.4.6.2.2 Loses Medicaid Eligibility but Remains Institutionalized If the institutionalized spouse remains in the institution and remains Medicaid eligible after the 12- month transfer period but subsequently becomes ineligible and remains institutionalized, spousal impoverishment asset rules would not be applicable if he or she should reapply. If the institutionalized spouse reapplies for Medicaid, his or her asset limit would be $2,000 and the community spouse's assets would not be counted. If eligible, the institutionalized spouse would still be allowed to allocate some of his or her income to the community spouse. Example 8 Gregory was institutionalized in December 2007. Gregory and his wife, Marcia, who remained in the community, passed the joint asset test. Gregory was found eligible and had until November 2008 to get under the $2,000 asset limit. By November 2008, Greg had transferred enough assets to Marcia to get under the asset limit. In March 2009, while Gregory remained institutionalized, he refused to sign over to Medicaid a health insurance payment check. His Medicaid eligibility was discontinued March 31, 2009, for failure to cooperate with TPL requirements. Greg has never left the institution and now reapplies for Medicaid on June 3, 2009. Since Greg did not leave the institution for 30 days or more since his original Medicaid spousal impoverishment application was approved (December 2007), the assets of his community spouse are not counted when determining eligibility for the application filed June 2009. Greg's asset limit for this application is $2,000. This page last updated in Release Number: 26-03 Release Date: 08/12/2026 Effective Date: 05/19/2026 18.5 Spousal Impoverishment Income The income limit is the same as for institutionalized persons who do not have a community spouse (see Section 39.4 EBD Assets and Income Tables). 18.5.1 Nontrust Income Count non-trust income as belonging to the person who receives the payment. 1. If the payment is received in both spouses' names, count half for each. 2. If the payment does not specify the payee, count half for each spouse. 3. If the payment is shared with others, count amounts equal to each spouse's proportionate share. Count as income to the institutionalized spouse any income that the community spouse actually makes available to him or her, whether voluntarily or under a court order.