In Louisiana, many families expect Medicare to step in if a loved one needs nursing home care. After all, it covers doctor visits, hospital stays, and rehabilitation.
But when the need shifts from medical treatment to the custodial care nursing homes provide, Medicare is no longer the answer. That gap leaves families facing one of the most pressing financial challenges of aging.
Medicare Coverage Limits
Medicare Part A covers hospital stays and rehabilitation services in a skilled nursing facility. To qualify, a patient must first spend at least three days admitted to a hospital.
Once discharged, Medicare will cover up to 100 days of skilled nursing. The first 20 days are fully covered, and days 21 through 100 require a daily coinsurance payment. After day 100, coverage ends.
Even during this limited window, Medicare is not covering custodial care. It only pays for rehabilitation, such as physical therapy after surgery.
The long-term help that many seniors require, like assistance with eating, dressing, or bathing, is excluded. When rehabilitation ends and custodial care is needed, Medicare has no role.
The Cost of Long-Term Care in Louisiana
The gap left by Medicare is significant because custodial care is expensive. In Metairie, LA, where we practice, a semi-private room in a nursing home typically costs about $8,000 per month.
Costs rise further for private rooms or facilities offering specialized care. Assisted living averages less, but it can still reach $5,000 per month or more. Full-time in-home health aides come with a similar price tag.
These figures illustrate why families quickly exhaust savings when a loved one requires long-term care. Indeed, few households can afford to pay these costs for more than a year or two.
This financial pressure is why Medicaid, not Medicare, has become the largest payer of long-term nursing home care in Louisiana and nationwide.
Medicaid as the Real Payer
Medicaid is a joint federal and state program that covers long-term custodial care for those who meet strict financial criteria. In 2025, an individual applicant in Louisiana must have no more than $2,000 in countable assets.
Countable assets include bank accounts, retirement funds, investments, and additional real estate beyond the primary residence.
Because the thresholds are so low, many families assume they will never qualify. However, Medicaid planning makes use of exemptions, legal tools, and spousal protections to preserve property while still achieving eligibility.
Non-Countable Assets
Not everything you own is considered in the $2,000 resource limit. Louisiana Medicaid treats some property as exempt.
Examples include one vehicle, household furnishings, clothing, and certain prepaid funeral or burial arrangements. These allowances recognize that applicants should not be stripped of all essentials.
The most significant exempt asset is often the family home, but that exemption is more complicated than it appears.
The Home and Medicaid Estate Recovery
In Louisiana, your home is not counted against you if you or your spouse still live there, subject to a federal equity cap of $730,000 in 2025. This means you do not have to sell your house to qualify for Medicaid. Many families find reassurance in this rule, but the protection is temporary.
Louisiana participates in Medicaid’s estate recovery program. After a recipient’s death, the state can place a lien on the home to recover the costs of care.
If the property passes through probate, it is vulnerable to this claim. Families often discover that the home they believed was safe ends up being sold to reimburse Medicaid, leaving heirs with nothing.
Protecting the Healthy Spouse
When one spouse needs nursing home care and the other remains in the community, Medicaid rules provide important protections. The Community Spouse Resource Allowance (CSRA) allows the healthy spouse to retain half of the couple’s assets up to a prescribed limit.
In 2025, the minimum CSRA is $31,584, and the maximum is $157,920. This ensures that the community spouse is not forced into poverty while the institutionalized spouse qualifies for Medicaid.
The beneficiary’s income must normally be applied toward the cost of care. However, if a healthy spouse depends on that income, the healthy spouse may keep part of it through the Monthly Maintenance Needs Allowance (MMNA). This year, the maximum MMNA is $3,948.
Medicaid Trust Solution
For families who want to protect the home and other assets from being consumed by long-term care costs, the irrevocable Medicaid trust is the most effective tool.
Sometimes called an income-only trust, this legal arrangement allows you to transfer property out of your name while retaining the income it generates.
After five years have passed from the date of transfer, the assets in the trust are no longer counted for Medicaid eligibility.
This is especially important for homeowners. By placing the residence in the trust, you not only remove it from the eligibility calculation, you also prevent it from being part of your probate estate.
Because it avoids probate, the property cannot be targeted by Medicaid estate recovery. Instead, it passes directly to your heirs.
The trust can also hold other assets, such as savings or investment accounts. While you give up direct access to the principal, you can continue to receive income distributions. This allows you to maintain cash flow during your life while preserving the underlying assets for your family.
Consider an example: a Metairie couple establishes a Medicaid trust and transfers their home and savings into it. Five and a half years later, one spouse requires nursing home care. Because the trust assets are no longer countable, the spouse qualifies for Medicaid without losing the house.
The healthy spouse continues to live in the home, and after both pass away, the property transfers directly to the children without being subject to estate recovery. Without the trust, that same house could have been sold to repay Medicaid.
Planning Ahead
The key to making a Medicaid trust work is timing. Since Louisiana applies the five-year look-back rule, any transfers into the trust within five years of applying for Medicaid create a penalty period of ineligibility.
This makes early planning critical. Families who act while still healthy preserve the most options and avoid scrambling during a crisis.
Medicaid planning should be integrated with your overall estate plan. A complete strategy includes a will, powers of attorney, and advance directives, ensuring that both financial and medical decisions are covered.
Attend a Free Event!
We host educational events in and around Metairie and Covington, and there is no charge to join us. You will learn a lot as you connect with our firm for the first time, and you can learn more here: Metairie, LA estate planning events.
- National Make-a-Will Month - August 1, 2026
- Dying Without a Will in Louisiana: Can Unexpected Heirs Inherit? - July 22, 2026
- Don’t Wait For A Crisis: Begin The Long-Term Care Talk With Parents Now! - July 20, 2026
