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What Medicare Does and Does Not Pay For

Medicare covers short skilled nursing stays, home health and hospice. It does not pay for assisted living or custodial care.

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Short answer

Medicare does not pay for assisted living, memory care, or long-term custodial care anywhere in Texas. It covers limited skilled nursing facility stays after a qualifying hospital admission, intermittent skilled home health, and hospice.

What Medicare covers

  • Skilled nursing facility care after a qualifying inpatient hospital stay, for a limited period, when skilled care is needed daily. This is rehabilitation, not long-term placement.
  • Home health that is intermittent and skilled — nursing visits, physical, occupational or speech therapy. Not a caregiver who stays with your parent.
  • Hospice — the hospice team, medications related to the terminal diagnosis, and equipment. Not room and board in a facility.

What Medicare does not cover

  • Assisted living rent, meals, or personal care
  • Memory care
  • Long-term custodial nursing home care
  • Non-medical home care, companionship, or homemaker services
  • Adult day care
The observation status trap. A Medicare skilled nursing benefit requires a qualifying inpatient hospital admission. Time spent under “observation status” does not count, even if your parent slept in a hospital bed for two nights. Ask the hospital directly whether your parent is admitted as an inpatient or under observation, and ask in writing.
What senior care costs. The Texas median is $5,666 a month for assisted living and $7,604 for a private nursing room. No Austin-specific median is published by any primary source. Read the full explanation →

Questions Austin families ask

What's the Medicaid income limit for a nursing home in Texas in 2026?

For a single applicant in 2026, monthly income must be under $2,982 and countable assets under $2,000. Your home and one vehicle are generally exempt. You must also meet Nursing Facility Level of Care. A community spouse may keep a separate resource allowance.

How much money can my spouse keep if I go into a nursing home in Texas?

Texas allows a Community Spouse Resource Allowance so the at-home spouse isn't impoverished, reported at $162,660 for 2026. The applicant spouse is limited to $2,000. Because these figures change annually and the calculation is complex, confirm current amounts with HHSC or a Texas elder law attorney.

How much spending money does a Texas nursing home resident keep?

Texas sets the Personal Needs Allowance at $75 per month, raised from $60 effective January 1, 2024. That's well above the $30 federal minimum. Nearly all remaining income, after Medicare premiums, any spousal allowance, and allowable medical expenses, goes to the facility as applied income.

Will Texas take my mother's house after she goes on Medicaid?

Texas may file an estate recovery claim after death if she was 55 or older when receiving services and first applied for long-term services on or after March 1, 2005. This covers nursing home care and STAR+PLUS. Texas never recovers more than it paid, and exemptions and hardship waivers exist.

Does Texas have a state program that pays for assisted living?

Not broadly. Texas has no general state-funded assisted living benefit. Two narrow options exist: STAR+PLUS Medicaid waiver assisted living services covering care but not room and board, and the state-funded Residential Care program under Community Care for Aged and Disabled, funded by Title XX block grants with interest lists.

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