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As we’ve covered before in our primer on the Arizona Long Term Care System (also known as ALTCS), there are two main components to ALTCS eligibility for Arizona seniors: a financial eligibility requirement, and a healthcare based eligibility requirement. In this blog post, we’ll focus on the financial eligibility requirements for ALTCS, including an explainer of how the different thresholds work, and the ways in which individuals and married couples can allocate their income and assets in order to be eligible for ALTCS coverage. 

Because regulations are always changing, and because each situation is unique, it’s important to make sure you talk to a local Arizona elder law attorney or financial advisor with experience helping seniors in order to make sure that any of the strategies discussed in this article are appropriate for you or your senior loved one. To learn more about the financial eligibility requirements for ALTCS, and find out if you may be eligible for ALTCS coverage, read more below.

ALTCS Overview

The Arizona Long Term Care System, known by its popular acronym ALTCS, is Arizona’s Medicaid-funded, state healthcare insurance program for Arizonans aged 65 and above in need of nursing home level of care. ALTCS is housed within the larger, statewide Arizona Health Care Cost Containment System (AHCCCS), and is one of the most common ways that Arizona seniors fund their long term care needs. Like most Medicaid programs around the country, ALTCS is focused on paying for Arizona seniors’ care, and can help cover the cost of care for Arizona seniors whether they’re living in their home, or in a senior living community or senior healthcare facility. One thing to remember is that because ALTCS pays for seniors’ care, ALTCS generally will not pay for room and board in an assisted living community, and rather will only cover expenses related to the provision of care.

ALTCS Financial Threshold

Along with being an Arizona resident who is aged 65 and above and who requires nursing home level of care (or who has a recognized disability such as blindness or a severe cognitive impairment), the two main requirements for qualifying for ALTCS coverage are: (1) showing that the senior applicant’s care is medically necessary, and (2) showing that the applicant meets the ALTCS financial threshold. The ALTCS financial eligibility requirements focus on two main categories: the applicant’s assets and their income.

ALTCS Income Limit

The first half of the ALTCS financial requirements test is the income limit. In 2023 the income limit for a single ALTCS applicant is $2,742 in gross pay per month. When both spouses are applying for ALTCS, their combined gross monthly income cannot exceed $5,484. Like many other states, Arizona has a special set of income rules for married couples where only one spouse is applying. Under this mechanism, known in Arizona as the Community Spouse Monthly Income Allowance, the spouse that is applying for Medicaid coverage can transfer up to $3,715.50 of their monthly income (as of 2023) to the non-applicant spouse, also known as a “community spouse” or “well spouse.” The point of the Community Spouse Monthly Income Allowance (or CSMIA) is to make sure that the applicant spouse can have enough income to live on, without having to reduce their own level of income so that their applicant spouse qualifies for ALTCS coverage.

The Community Spouse Monthly Income Allowance is just one way in which applicants who may seem not to qualify for ALTCS can arrange their finances in such a way as to be eligible for ALTCS care. This is one reason why it’s always important to speak to a local Arizona elder care attorney or financial advisor with expertise handling senior clients in order to understand whether you qualify. Another such method is known as a Miller Trust or alternatively in Arizona as a Qualified Income Trust, or an Income Only Trust. A Miller Trust allows an individual whose income exceeds the ALTCS income limit to set aside some part of their income necessary to bring their income level below the ALTCS threshold. This allows individuals whose income exceeds the ALTCS income limit, but who do not have enough income to pay for at-home or community based skilled nursing or long term care, to still become eligible for ALTCS coverage. If you think that a Miller Trust may be appropriate for you or your senior loved in Arizona, it is important to contact a local Arizona elder law attorney.

ALTCS Asset Limit

The second major part of the ALTCS financial requirements test is the asset limit. Just like with income, ALTCS has two different asset thresholds depending on whether a senior applicant is single or married. In 2023 the asset limit for individual senior applicants in Arizona is $2,000, and is $4,000 when both spouses are applying for ALTCS coverage. While this might seem like a very low threshold, this asset limit only includes “countable assets” with many big-ticket items being excluded. For example, an applicant’s equity interest in their primary residence (or the non-applicant spouse’s primary residence) is excluded as long as it is below $688,000. An applicant’s primary vehicle is also excluded. Assets that are generally counted include savings and checking accounts, second homes, and investments like stocks and bonds.

Just like with the income limit, Arizona has a special set of rules to make sure that the non-applicant spouse is not impoverished just so the applicant spouse can qualify for ALTCS coverage by allowing the applicant spouse to transfer assets to the non-applicant spouse. In 2023 this limit in Arizona, known as the Community Spouse Resource Deduction, is capped at $148,620. Similarly to income, there are strategies by which an individual who might appear over the asset limit can restructure their assets in order to come under the ALTCS asset threshold. One rule on restructuring assets to keep in mind is that Arizona has a 60 month “look-back period.” This means that during the 60 months prior to applying for ALTCS an applicant may not sell or give away any assets for less than their fair market value in order to qualify for ALTCS. This is why it’s particularly important to contact a local Arizona elder law attorney or financial advisor if you have questions regarding your or your senior loved one’s assets, and whether they allow you to qualify for ALTCS coverage.

To learn more about how Sunbound can help make paying for senior living and senior care more affordable for you or your senior loved one, send us an email at info@sunboundhomes.com or request more information on Sunbound. Sunbound is the best way to pay for senior living and senior care, and we’re on a mission to make senior living and senior care more affordable for everyone.