Medicare-Medicaid Pay-Down of Assets
State law and regulations impose income and asset limits on persons applying for Medicaid.
A person is eligible for Medicaid if he or she has a monthly income no greater than 100% of the of the federal poverty level which, for 2025, is $1,304 per individual and $1,762 per couple. No applicant, regardless of marital status, may have more than $17,500 in assets. If only one spouse is applying, the non-applicant spouse may retain assets valued up to $135,648.
A transfer of assets for less than fair market value made by an institutionalized person or the spouse of that person within 60 months before the later of applying for medical assistance or transferring an asset shall result in a period of ineligibility for long term care services for that person. The penalty period is determined based on the uncompensated value of transfers. The penalty period is calculated by dividing the total uncompensated value of assets transferred by the average monthly cost of long-term care services at the private rate in the community in which the person is institutionalized at the time of application.
Illinois Dept. of Healthcare and Family Services, Medical Programs
Ill. Admin. Code tit. 89, § 120.388