How Medicaid Covers Long-Term Care in Tennessee

What TennCare CHOICES actually is

CHOICES is the name Tennessee gives its Medicaid long-term care benefit for adults who are 65 or older or who have a physical disability. It is not a separate program layered on top of TennCare. It is TennCare, delivered through a managed care organization that assigns every enrollee a care coordinator. That coordinator, not a state office and not the residence, authorizes the services a member actually receives.

Congress lets states build long-term care coverage under several different statutory authorities: 1915(c) waivers, the 1915(i) and 1915(k) state plan options, and Section 1115 demonstrations. Which authority a state picks shapes who qualifies and what is covered 1Ref 1Centers for Medicare & Medicaid Services (2025).Home & Community Based Services Authorities.That states may cover home- and community-based long-term services under several different Medicaid authorities, including 1915(c), 1915(i), 1915(k) and Section 1115, and that eligibility and coverage vary by which authority a state uses.. Tennessee is unusual in that nearly all of TennCare, CHOICES included, runs inside a Section 1115 demonstration rather than as a freestanding waiver. The practical consequence for a family is that there is no separate waiver list to sign up for in the way there is in several neighbouring states. You are asking to be enrolled in a group within TennCare itself.

A level of care determination is the clinical test, entirely separate from the money test, that asks whether a person needs the kind of help a nursing facility provides. Tennessee applies it before it will pay for either a nursing home or the community alternative to one.

The three CHOICES groups, and why the group decides everything

CHOICES sorts people into three groups, and the group determines the benefit. Group 1 is nursing facility care. Group 2 is home and community-based care for someone who meets nursing facility level of care but would rather stay out of one. Group 3 is a narrower package for people who do not yet meet that level of care but are at risk of needing it.

Group 3 surprises people who have dealt with Medicaid elsewhere. Most states will not pay for anything until a person is already sick enough for a nursing home. Tennessee holds a narrower door open before that point, reasoning that a few hours of help now costs less than a bed later. It is not the same promise as Group 1: the Group 3 package carries a cost cap and enrollment limits in a way nursing facility care does not.

The group a person is placed in, not the diagnosis they carry, is what decides what Tennessee will pay for.

Does TennCare pay for assisted living in Tennessee?

Partly, and the part it leaves out is the part that hurts. Through CHOICES Group 2, TennCare can pay for the care services delivered inside a licensed assisted-care living facility: personal care, medication oversight, help with bathing and dressing, and the nursing that supervises it. It does not pay the room-and-board charge. The resident pays that from their own monthly income and keeps only a small personal needs allowance.

Tennessee's licensing vocabulary matters here, because it is not the vocabulary the brochures use. The state licenses assisted-care living facilities and, separately, homes for the aged. A residence advertising itself as assisted living may hold either licence, and the licence determines what it may do for a resident whose needs grow. Asking which licence a residence holds, and whether it contracts with the TennCare plan you would be enrolled in, is far more useful than asking whether they take Medicaid — a receptionist will often answer yes to the vague question.

The room-and-board split is what ambushes families financially. Social Security and any pension go toward the facility, the personal needs allowance is what remains, and if the room-and-board rate exceeds what the resident's income covers, the gap is real money that someone has to find every month. Nationally, the median cost of assisted living reached $70,800 a year in 2024, and a semi-private nursing home room $111,325 2Ref 2Genworth Financial / CareScout (2025).Genworth and CareScout Release Cost of Care Survey Results for 2024.The 2024 national median annual cost of assisted living ($70,800) and of a semi-private nursing home room ($111,325), cited as national scale rather than as Tennessee figures or Medicaid rates.. Those are national medians, not Tennessee figures and not what Medicaid pays — but they are the scale of the problem the benefit exists to solve.

Tennessee is an income-cap state, which is why families end up in a lawyer's office

Tennessee does not offer a medically needy spend-down for long-term care. It sets a hard monthly income cap, and a person one dollar over it is ineligible, no matter how large the nursing home bill in front of them is. The instrument that resolves this is a Qualified Income Trust, often called a Miller trust, which routes the monthly overage into a trust.

This is the sharpest single difference between Tennessee and a spend-down state. Where a medically needy pathway exists, high income is not disqualifying on its own: you spend it on care until you fall under the threshold, and coverage picks up. In Tennessee, income above the cap disqualifies outright, and the trust is the only cure. A Qualified Income Trust does not shelter money or save it for heirs — the income still goes to the cost of care. It exists only to make that income invisible to the eligibility formula.

The cap itself moves with the federal benefit rate each January, so the current number belongs on TennCare's own eligibility material rather than in any article, this one included. The same caution applies to asset limits and the look-back period on transfers. Families often compare across state lines, because a parent may move to be near an adult child. That comparison is harder than it looks: medicaid waivers by state are built on different authorities under different names. Just across the line, georgia medicaid waivers run as 1915(c) waivers with their own enrollment lists, a structure TennCare's demonstration does not use.

What Medicare will not do, in Tennessee or anywhere else

Medicare does not pay for long-term custodial care. Not in a nursing home, not in assisted living, not at home, when help with bathing, dressing, eating and moving is the only care a person needs 3Ref 3Centers for Medicare & Medicaid Services (2026).Long-term care coverage.That Medicare and most health insurance, including Medigap, do not pay for long-term custodial care in a nursing home, assisted living, or at home when help with activities of daily living is the only care needed.. Medigap does not fill this gap either, despite the name. Medicare's nursing home coverage is short-term skilled care following a qualifying hospital stay, and it ends when the skilled need ends.

Families usually discover this at the worst possible moment, somewhere around day 20 or day 100 of a rehabilitation stay, when the skilled benefit tapers or stops and the bill converts to private pay with almost no warning. The realistic ways to pay for a long stay are personal funds, Medicaid if you qualify, or a long-term care insurance policy bought years before anyone needed it 4Ref 4Centers for Medicare & Medicaid Services (2026).How can I pay for nursing home care?.That Medicare covers only limited short-term skilled nursing facility stays after a qualifying hospital stay, and that a long stay is paid through personal funds, Medicaid if eligible, or long-term care insurance.. In Tennessee, the Medicaid answer is CHOICES, which means passing both the financial test and the level-of-care test.

If one spouse needs care and the other is staying in the house

Federal spousal-impoverishment rules apply in Tennessee, and they exist precisely so that the husband or wife who stays home is not stripped down to nothing. When one spouse needs institutional or waiver long-term care expected to last at least 30 days, a portion of the couple's combined income and assets is protected for the spouse remaining in the community 5Ref 5Centers for Medicare & Medicaid Services (2025).Spousal Impoverishment.That spousal-impoverishment rules protect a portion of a couple's income and assets for the community spouse through the Community Spouse Resource Allowance and the Minimum Monthly Maintenance Needs Allowance, when the other spouse needs institutional or waiver long-term care lasting at least 30 days..

The two protected amounts have names worth learning. The Community Spouse Resource Allowance is the share of countable assets the at-home spouse keeps. The Minimum Monthly Maintenance Needs Allowance is the floor under their monthly income; where their income falls short, some of the institutionalized spouse's income can be directed to them instead of to the facility 5Ref 5Centers for Medicare & Medicaid Services (2025).Spousal Impoverishment.That spousal-impoverishment rules protect a portion of a couple's income and assets for the community spouse through the Community Spouse Resource Allowance and the Minimum Monthly Maintenance Needs Allowance, when the other spouse needs institutional or waiver long-term care lasting at least 30 days.. Both rest on a snapshot of the couple's assets taken at the start of the care episode, which is why the date of a hospital admission can matter as much as the arithmetic.

These rules assume the spouse at home still has a life to fund. That is the design, not a loophole in it.

Where a Tennessee family starts, and who is required to help

For someone living in the community, the front door to CHOICES is the Area Agency on Aging and Disability serving their county, a regional network that handles intake and the first screen. For someone already in a nursing facility, staff there typically start the request. Either way the level-of-care assessment and the financial determination move in parallel, and either one can be the thing that stalls.

Two sources of free help are worth knowing about before the crisis rather than during it.

• The State Long-Term Care Ombudsman. Every state has one. The program advocates for residents of nursing homes, assisted living, and board-and-care homes, and resolves complaints about their health, safety, welfare and rights 6Ref 6Administration for Community Living (HHS) (2025).Long-Term Care Ombudsman Program.That a State Long-Term Care Ombudsman program operates in every state, advocating for residents of nursing homes, board-and-care and assisted living and resolving complaints about their health, safety, welfare and rights.. It is free, confidential, and does not work for the facility.
• The CHOICES care coordinator. Once someone is enrolled, this is the person who authorizes services, and the person to press when authorized hours do not match the need.

On every tour, ask which Tennessee licence the residence holds and whether it contracts with your specific TennCare plan. "We take Medicaid" is not an answer to either question.