Medicaid & Reverse Mortgages

April 12, 2019

A common concern among reverse mortgage applicants is whether or not their Medicaid benefit will be affected by a reverse mortgage. Medicaid is a government-sponsored program that is intended to provide healthcare to low-income individuals.  Unlike with Social Security and Medicare, Medicaid eligibility can be affected by a reverse mortgage.

Calculate Your Eligibility

What is Medicaid?1

  • Medicaid is the nation’s public health insurance program for people with low income. Medicaid provides health coverage to millions of Americans, including eligible low-income adults, children, pregnant women, elderly adults, and people with disabilities.
  • 65.9 Million People are covered by Medicaid.
  • Medicaid is administered by states according to federal requirements.
  • The program is funded jointly by states and the federal government.

What Services Are Covered with Medicaid Benefits?1

  • States establish and administer their own Medicaid programs and determine the type, amount, duration, and scope of services.
  • Federal law requires states to provide certain mandatory benefits which include inpatient and outpatient hospital services, physician services, laboratory and x-ray services, and home health services, among others.*
  • States are allowed the choice to cover other optional benefits such as prescription drugs, dental services, and optometry services to name a few.*

A reverse mortgage can be helpful to senior homeowners who are looking for additional funds.  Borrowers are not automatically disqualified for Medicaid with a reverse mortgage. However, the homeowner has to be careful with the amount of reverse mortgage funds they have readily available every month. Therefore, determining Medicaid eligibility with a Reverse Mortgage can become quite complicated.

Seniors should contact their state’s Medicaid administrator to determine exactly how to comply with the Medicaid eligibility requirements if they take out a reverse mortgage.  Having an expert advise you can help you make a more informed decision.


Important Disclosures
*A complete list of Mandatory and Optional Medicaid Benefits can be found at https://www.medicaid.gov/medicaid/benefits/list-of-benefits/index.html

1Medicaid.gov.  https://www.medicaid.gov/medicaid/index.html