August 28, 2026
3:45 am

When a Couple Is Placed in Separate Facilities

When both spouses are institutionalized, the spousal impoverishment protections that families count on generally stop applying, because those rules exist to protect a spouse who remains in the community. Each spouse is then usually evaluated as an individual, against an individual asset limit that is far lower than the community spouse allowance. That single change is the most expensive fact in this situation and almost nobody is told it in advance.

The human version is worse than the financial version. Sixty years of marriage, and one of them is in a memory care unit across town because that was the bed that existed on the day the hospital needed the room. Somebody is driving between two buildings, and both people are asking about the other.

Everything that can be changed here runs on a deadline, and most of the deadlines are short. What follows puts them in order. Pine Lake Legacy provides education and a free policy review only, and does not give legal, tax or Medicaid-eligibility advice; an elder law attorney in your state does.

In This Article

The Two-Day Clock: A Medicare Skilled Stay Ending
The 30-Day Clock: Transfer, Discharge and Bed-Hold
The 45- to 90-Day Clock: The Medicaid Application
The 60- to 90-Day Clock: Appeals and Fair Hearings
What Happens to Two Life Insurance Policies
When Selling a Policy Is the Wrong Answer Here
Frequently Asked Questions

When a Couple Is Placed in Separate Facilities

The Two-Day Clock: A Medicare Skilled Stay Ending

If either spouse arrived from a hospital on a Medicare-covered skilled nursing stay, the fastest clock in the whole situation is the one that ends it.

Medicare Part A can cover a skilled nursing facility stay for up to 100 days per benefit period following a qualifying hospital stay, with no coinsurance for the first 20 days and a daily coinsurance amount for days 21 through 100. That coinsurance was $209.50 a day in 2025 and is reset annually, so confirm the current figure at Medicare.gov. Coverage ends earlier than 100 days whenever the facility determines skilled care is no longer needed, which is the usual outcome.

The facility must give written notice, and this is where families lose money. A Notice of Medicare Non-Coverage generally must be delivered at least two days before coverage ends, and it explains the right to an immediate, expedited appeal to the Beneficiary and Family Centered Care Quality Improvement Organization named on the notice. The request generally must be made by noon of the day before coverage is set to end. If you file in time, coverage typically continues while the review is decided, and you are generally not liable for the days under review if you lose. That is an unusually favorable rule and it expires almost immediately.

Call the number on the notice the day it is handed to you. Ask the facility for a copy if it was left with the resident and nobody in the family saw it, and ask what date it was delivered.

The 30-Day Clock: Transfer, Discharge and Bed-Hold

Involuntary transfer or discharge. Federal nursing home requirements at 42 CFR part 483 permit a facility to transfer or discharge a resident only for specified reasons, and generally require at least 30 days written notice, delivered to the resident and a representative, stating the reason, the effective date, the destination, and the right to appeal to the state. Notice can be shorter in urgent circumstances such as an emergency or a health-endangering situation. If a facility says a spouse must leave because private funds are running out and Medicaid has not yet been approved, ask for the notice in writing and request a hearing. Facilities that participate in Medicaid may not discharge solely because payment source is changing.

Bed-hold. When a resident goes to the hospital, the facility must give written notice of the state’s bed-hold policy and of the resident’s right to return. Medicaid bed-hold coverage varies by state and is often limited to a small number of days per year or not covered at all, in which case the family can usually pay privately to hold the bed. Ask for the bed-hold policy in writing before it is needed, not during an ambulance ride.

Room and roommate changes. Residents have rights to notice of a room change. If reuniting the couple in one building is the goal, put a written request on file with both facilities for the next available appropriate bed and ask how the waiting list is maintained. Verbal requests do not survive staff turnover.

The Long-Term Care Ombudsman program, funded under the Older Americans Act and operating in every state, advocates for residents at no cost and is the single most underused resource in this scenario. Call before a conflict, not after.

The 45- to 90-Day Clock: The Medicaid Application

States generally must act on a Medicaid application within 45 days, or up to 90 days where a disability determination is required. Retroactive coverage for up to three months before the month of application is available in many states, though some have narrowed or waived it, so confirm what applies with the state Medicaid agency before assuming a gap is unfixable.

Two applications are usually needed, one for each spouse, and this is where the arithmetic changes.

The spousal impoverishment rules enacted in federal law protect a spouse who remains in the community when the other is institutionalized. In 2025 the maximum community spouse resource allowance was $157,920 and the minimum was $31,584, with a maximum monthly maintenance needs allowance of $3,948. These figures are indexed annually — confirm the current-year numbers with the state Medicaid agency, because they change every January and a stale figure is exactly the kind of error that costs a family real money.

When both spouses are institutionalized, those protections generally do not apply, because there is no community spouse. Each spouse is typically evaluated individually against the state’s individual resource limit, which in most states is $2,000 for an aged, blind or disabled applicant as of 2026. The practical effect is that assets a family expected to keep become countable. That is precisely the situation in which an elder law attorney licensed in your state earns their fee, and it is worth the consultation before either application is filed rather than after.

Notice or Event	Deadline	Who to Contact
Notice of Medicare Non-Coverage	Appeal generally by noon the day before coverage ends	The quality improvement organization named on the notice
Involuntary transfer or discharge notice	Generally 30 days written notice; appeal window on the notice	State agency named on the notice; Long-Term Care Ombudsman
Hospital stay and bed-hold	Written bed-hold policy must be provided	Facility admissions; state Medicaid agency
Medicaid application decision	Generally 45 days; up to 90 with a disability determination	State Medicaid agency
Medicaid fair hearing request	Commonly 60-90 days; often 10 days to continue benefits	State Medicaid agency; legal aid
Medicare redetermination	Generally 120 days from the Medicare Summary Notice	SHIP counselor; the contractor on the notice

The 45- to 90-Day Clock: The Medicaid Application

The 60- to 90-Day Clock: Appeals and Fair Hearings

Every adverse decision comes with an appeal right and a deadline printed on the notice, and the deadlines differ by program.

A Medicaid denial, reduction or termination carries the right to a fair hearing. The federal framework requires states to allow a reasonable period, and states commonly set the window somewhere between 60 and 90 days from the notice date. Where a benefit is being reduced or terminated rather than denied, requesting a hearing within a short window, often 10 days from the notice, can continue benefits while the appeal is pending. Read the notice for both numbers.

Medicare appeals run through a five-level process, with the first-level deadline for a redetermination generally 120 days from the Medicare Summary Notice. Medicare Advantage and Part D plans have their own deadlines printed on their denial notices.

A nursing home transfer or discharge appeal goes to the state agency identified on the notice, usually with a short window measured in days.

Two free sources of help exist in every state and neither is used enough. The State Health Insurance Assistance Program, or SHIP, provides free unbiased counseling on Medicare and will help build an appeal. The Long-Term Care Ombudsman handles facility issues. Neither sells anything.

Put every notice in one folder with the delivery date written on it in pen. Appeals are won and lost on which day a notice arrived.

What Happens to Two Life Insurance Policies

Most states disregard life insurance when the total face value of all policies on a person is at or below $1,500, and count the cash surrender value when the face exceeds that threshold. The threshold turns on face value, not cash value, so a $10,000 whole life policy with $2,400 of cash value is generally fully countable, while a $1,200 policy with $700 of cash value generally is not. As of 2026, confirm the figure and its treatment with the state Medicaid agency, because a few states use different rules and the threshold has been unchanged long enough that people assume it is universal.

Term insurance with no cash value is generally not a countable resource, though it is also generally not a funding source. Irrevocable funeral arrangements and burial funds are treated separately, and an irrevocably assigned burial policy is commonly excluded within state limits.

With both spouses institutionalized, each is evaluated separately, so two modest policies that were fine under a community spouse allowance can both become countable. Our page on how life insurance counts as a Medicaid asset works through the threshold in detail.

Do not surrender or transfer a policy to fix this without advice. Transferring a policy for less than fair market value during the look-back period, generally 60 months as of 2026, can create a period of ineligibility, and the application asks about transfers directly. Confirm the current look-back rule with the state Medicaid agency and take the structure to an elder law attorney. The general mechanics are on our page about the Medicaid look-back period.

When Selling a Policy Is the Wrong Answer Here

Families in this situation often reach for the policies because they are the only assets that feel liquid. That instinct is right about a third of the time and expensive the rest.

Selling is wrong when the face amount is small. Below roughly $100,000 the secondary market rarely produces an offer worth the months it takes, and the more relevant question is whether the policy can be irrevocably assigned for burial and excluded.

It is wrong when the policy is already inside the burial exclusion or has been assigned to a funeral provider. Converting an excluded resource into cash creates a countable asset and can push an application backward.

It is wrong when the insured is in good health for their age, because projected life expectancy is long and offers compress toward nothing.

And it is wrong when one spouse is likely to return to the community. The moment one spouse goes home, the spousal impoverishment protections generally come back into play and the whole calculation changes. Selling a policy in month two, based on the rules that applied in month two, is how families create a problem in month six. Where one spouse may leave institutional care, hold the position and get advice first — our page on nursing home Medicaid spend-down covers the sequencing.

Where a policy is genuinely large, genuinely unaffordable, and genuinely not needed by anyone, understanding its actual value before surrendering it is simply prudence, because the surrender value is the floor rather than the ceiling. Send the policy cover page and the most recent statement for a free policy review, or call (732) 978-9575.

Frequently Asked Questions

Do the spousal impoverishment rules still protect us?

Generally not once both spouses are institutionalized, because those protections exist for a spouse remaining in the community. Each spouse is then usually assessed individually against the state’s individual resource limit, commonly $2,000 as of 2026. Confirm the current figures with the state Medicaid agency and get an elder law attorney involved before either application is filed.

Can we insist on being placed together?

You can request it, and you should do so in writing with both facilities and keep a copy. Nursing home requirements support a married couple residing in the same room when both are residents of the same facility and both consent, but availability governs. Ask each facility how its waiting list works and ask the Long-Term Care Ombudsman to advocate; the service is free.

The facility says one spouse has to leave. Can they do that?

Only for specified reasons and generally with at least 30 days written notice stating the reason, the destination and the appeal rights. A facility participating in Medicaid generally may not discharge a resident solely because the payment source is changing from private pay to Medicaid. Ask for the notice in writing and request a hearing within the window it states.

How much can we keep between us?

That depends on whether either spouse is in the community. The 2025 community spouse resource allowance ranged from a minimum of $31,584 to a maximum of $157,920, indexed annually. With both spouses institutionalized those protections generally do not apply. Confirm the current-year figures with the state Medicaid agency, because they change every January.

What happens to our two life insurance policies?

Most states disregard life insurance only where the total face value per person is at or below $1,500, counting cash surrender value above that. The test is face value, not cash value, so a modest whole life policy is usually fully countable. Confirm the treatment with the state Medicaid agency and do not transfer or surrender anything before getting advice.

Who can help us for free?

Three sources. The Long-Term Care Ombudsman program advocates for residents in every state at no cost. The State Health Insurance Assistance Program provides free unbiased Medicare counseling and appeal help. Legal aid organizations and the Area Agency on Aging can assist with Medicaid applications and fair hearings. None of them sell anything.

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