When one spouse needs a nursing home, memory care, or paid care at home, the spouse who is still well usually assumes the worst about money. The common belief is that the couple has to spend nearly everything they own before Medicaid will pay, and that the healthy spouse will be left with the same $2,000 the applicant is allowed to keep. Some couples have even been told that divorce is the only way to protect the spouse at home.
Oregon's rules do not work that way. Federal law requires every state to protect the spouse who is not receiving care, and Oregon's Medicaid rules carry those protections out in detail. The state calls that spouse the "community spouse." I will call that person the spouse at home.
The protections fall into three areas: the house, the couple's savings, and monthly income. The dollar figures below are the ones in effect as of November 2026. The savings figures adjust each January and the base income figure adjusts each July.
The House
The home is not counted as a resource while the applicant's spouse lives in it. The home equity limit that applies to a single applicant does not apply when a spouse occupies the home, so the value of the house does not change the answer.
One vehicle is also excluded.
Savings: The Spouse at Home Keeps a Protected Share
Everything else the couple owns that Medicaid counts is added together. It does not matter whose name is on the account. A brokerage account titled only to the wife and a savings account titled only to the husband are both counted as the couple's resources.
The state then looks at a specific date: the day the spouse who needs care began a continuous period of care, which generally means a stay of at least 30 consecutive days in a care setting. The couple's countable resources on that date are totaled and divided in half. The spouse at home keeps one half, subject to a floor and a ceiling. The floor is $32,532. The ceiling is $162,660. The spouse receiving care keeps $2,000.
Three hypothetical couples show how the floor and ceiling work.
A couple with $100,000 in countable resources on that date: the spouse at home keeps $50,000 and the applicant keeps $2,000. The remaining $48,000 is over the limit.
A couple with $50,000: half would be $25,000, which is below the floor, so the spouse at home keeps $32,532. With the applicant's $2,000, about $15,500 is over the limit.
A couple with $400,000: half would be $200,000, which is above the ceiling, so the spouse at home keeps $162,660. With the applicant's $2,000, about $235,000 is over the limit.
The amount over the limit has to be dealt with before the applicant is eligible, and how it is dealt with matters a great deal. Giving it to the children creates a penalty period. I cover that rule, and the other ways a family can get this wrong, in my post on what counts against you and what the state takes back.
Because the half is measured as of the date care began, that date is often already in the past by the time a family starts asking questions. The numbers on that date are fixed. What the couple can do next depends on them, which is why I ask for them early.
Oregon's rules also allow a protected share above the ceiling in limited circumstances, where the income of the spouse at home falls short of the monthly allowance described below even after the other spouse's income is taken into account. That path is narrow.
After Approval, the Protected Share Has to Be in the Right Name
Once the applicant is approved, the resources that make up the protected share must be moved into the name of the spouse at home if they are not there already. Oregon gives 90 days to finish those transfers, with extensions for good cause. Anything still in the applicant's name after that period counts toward the applicant's $2,000 limit going forward.
Transfers between spouses are not penalized, so moving assets into the name of the spouse at home does not create a gift problem. Someone does have to have legal authority to sign for the spouse receiving care, and by this point that spouse often cannot sign. A durable power of attorney that grants enough authority to make those transfers is what lets them happen without a court proceeding.
Income: The Spouse at Home Keeps Their Own, and Sometimes Part of Their Spouse's
Income follows the name on the check. Social Security, pension, and other income paid to the spouse at home belongs to that spouse. Oregon does not count it in deciding whether the other spouse qualifies, and it does not require any of it to be paid toward the other spouse's care.
The income test applies only to the spouse who needs care. That spouse's own gross income is measured against Oregon's income cap, and an applicant over the cap needs an income cap trust to qualify. Being married does not change that requirement.
The second income protection applies when the spouse at home has a modest income. Oregon sets a monthly allowance for the spouse at home. The base allowance is $2,705 a month. It increases when the housing costs of the spouse at home (rent or mortgage, property taxes, insurance, and a standard allowance for utilities) exceed $811.50 a month, up to a maximum of $4,066.50.
If the income of the spouse at home is below that allowance, the difference can come out of the income of the spouse receiving care before the rest goes to the cost of care. As a hypothetical, a spouse at home with $1,500 a month in income and no excess housing costs is $1,205 short of the base allowance. Up to $1,205 a month of the other spouse's income can go to the spouse at home. The spouse receiving care keeps a small personal needs allowance, and what remains of that spouse's income is paid toward care.
What Happens After a Death
Two points about death belong in every married couple's Medicaid plan.
The first is estate recovery. The state has a claim for the long-term care benefits it paid, but that claim is deferred while the surviving spouse is alive. After the surviving spouse dies, the claim can reach what that spouse received from the spouse who was on Medicaid. My post on Medicaid estate recovery covers how the claim works and what it reaches.
The second is the estate plan of the spouse at home. Most married couples have wills or trusts that leave everything to each other. If the spouse at home dies first with that plan in place, the protected share and the house pass to the spouse who is on Medicaid, who is allowed $2,000. The inheritance can end eligibility until it is spent on care. The estate plan of the spouse at home should be reviewed as soon as the other spouse needs long-term care, and it is part of the planning I do for married couples.
Planning Ahead Versus Planning in a Crisis
Everything above applies to a couple who needs Medicaid now or soon. The spousal protections are available without any advance planning, which is why a married couple in a crisis usually has more options than a single person does.
A couple with time has a wider set of tools. A Medicaid asset protection trust funded more than five years before either spouse applies can protect assets beyond the ceiling, and it protects the couple's children's inheritance from estate recovery in a way the spousal rules alone do not.
Bottom Line
Oregon Medicaid does not require the spouse at home to become poor. The house is protected while that spouse lives in it. That spouse keeps half of the couple's countable savings, measured on the date care began, between a floor of $32,532 and a ceiling of $162,660. That spouse keeps all of their own income and can receive part of the other spouse's income when their own is below the monthly allowance. Divorce is not required for any of it.
The rules reward getting the numbers right on the correct date and putting assets in the correct name afterward, and they penalize well-meant moves like gifts to children. I handle Medicaid planning and Medicaid applications for married couples across Oregon, and I would rather look at the numbers before anything has been moved.
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This post is general information about Oregon law and is not legal advice. Medicaid figures change during the year, and the rules apply differently to different families. Reading this post does not create an attorney-client relationship with Track Town Law.
