Nursing home care in Texas can burn through a lifetime of savings faster than most families think. And when you’re trying to get Mom or Dad on Medicaid, bad advice spreads like wildfire: at the hospital, in Facebook groups, even from well-meaning friends.
At Fortuna, we specialize in helping families navigate this complicated process. Let’s clear up some myths Texas families run into when a parent needs long-term care Medicaid (nursing home Medicaid), and what to do instead.
Note: This is educational information, not legal advice. Texas Medicaid rules are technical and may vary based on your specific circumstance.
Reality: The “house panic” is usually aimed at the wrong target. If anything, selling the house can even harm eligibility.
In Texas, a primary residence is often treated differently than cash in the bank for eligibility purposes.
The bigger “house risk” usually comes later through the Medicaid Estate Recovery Program (MERP). This means the state can seek repayment from a recipient’s estate after death for certain long-term services and support. This typically takes place after death, not while your parent is alive. In fact, the state generally doesn’t seek MERP recovery while a spouse is alive, if there’s a child under 21, or a blind/disabled child (and other exceptions).
Many families focus on “Will Medicaid make us sell?” when the smarter question is: “How do we keep the home from becoming a probate asset later?” That’s where tools like Lady Bird deeds or transfer-on-death strategies may come into play in Texas, when done correctly and at the right time.
Avoid the costly mistake: panic-selling the home without a plan, which may create tax issues, or generate cash that becomes a countable resource.
Reality: Medicaid has limits, but there are also legal, allowed ways to qualify without nuking the entire financial picture.
For nursing home Medicaid, Texas generally applies:
If one spouse needs nursing home Medicaid and the other spouse is still living at home, the “community spouse” may be allowed to keep a protected amount of assets. This could be up to $162,660 for 2026, or potentially more, depending on the approved Medicaid strategies you use.
What this means is many married couples do not have to impoverish the healthy spouse to get Medicaid for the spouse in care.
Reality: In Texas, giving assets away can trigger a penalty period, which is a stretch of time Medicaid won’t pay. This is because Texas applies a 60-month (5-year) look-back for certain long-term care Medicaid situations.
Texas HHSC explains the look-back concept and how penalties are calculated based on transfers for less than fair market value.
This myth is particularly dangerous, as families often make gifts at moments when they’re scared, often after a hospital event. This unintentionally creates a period where a parent is in a nursing home, Medicaid won’t pay yet, and the facility begins billing you privately.
A simple gift can become a multi-month (or longer) gap in coverage.
Reality: Texas is an income-cap state for certain long-term care Medicaid categories, but Texas also allows a tool called a Qualified Income Trust (QIT) (often called a Miller Trust) to address excess income.
A QIT is used when the applicant has income in excess of the allowable income limits. If properly executed and funded, QITs can enable applicants to qualify for Medicaid.
However, note that a QIT is not “free money” or a loophole to keep income. It’s a compliance mechanism so Medicaid can approve eligibility while the applicant’s income is routed appropriately.
It’s important to set up the QIT correctly, and at the correct time, to avoid delays or denials.
Reality: Approval is not the finish line. It’s the start of staying eligible and avoiding landmines.
Common post-approval pitfalls include:
Also, if your plan includes “we’ll deal with the house later,” later turns into MERP conversations after your loved one passes—when options can be fewer.
Treating Medicaid like a one-time application instead of an ongoing eligibility program can create risks.
If a parent is heading into or already in a nursing home, we’re here to help. Fortuna’s team of Texas long-term care Medicaid experts can walk you through each step of the process.
We’re currently offering free consultations — learn more here.
