MassHealth Rules Are Changing Quickly in 2026: What Massachusetts Seniors Need to Know

As Boston-area elder law attorneys, we help people plan to protect their assets from the high cost of long-term care, whether they are receiving care at home or in a nursing home.  Figuring out how to pay for long-term care can be confusing, especially for those to want to apply for MassHealth (Medicaid).

Over the past few months, there have been significant changes affecting new MassHealth applications, redeterminations, and PACE enrollment.

If you are receiving MassHealth benefits, considering applying, or relying on MassHealth as part of your long-term care plan, here’s what you need to know.

PACE Is Now Reviewing Spousal Assets More Closely

PACE (the Program of All-Inclusive Care for the Elderly), which helps many seniors remain at home or in assisted living facilities and receive the care they need, has tightened its eligibility requirements.

PACE is now:

• Reviewing spousal assets, even when only one spouse is applying

• Requiring proof that the community spouse’s assets are below the allowable limit

For 2026, the community spouse asset limit is $162,660.

This change has surprised many families who assumed that spousal assets would not be scrutinized at this level. Without advance planning, PACE eligibility may be delayed or denied.

Each year, MassHealth requires a redetermination of eligibility.  It is unclear what will happen for married couples, but we anticipate they will consider the spouse’s assets in the redetermination application. 

Five Years of Financial Statements Are Now Required

MassHealth applications are now routinely requesting:

• Five full years of financial statements

• Verification of every transaction over $1,000

This applies to bank accounts, investment accounts, and brokerage accounts. Every transfer, withdrawal, deposit, or unusual transaction must be explained and documented.

As a result, applications are taking longer and require significantly more organization and follow-up.

MassHealth Redeterminations Are Becoming More Demanding

Annual redeterminations are no longer simple renewals. We are seeing requests for:

• Five years of updated financial records

• Spousal financial information, even when the spouse is not on benefits

• Proof that the community spouse remains under the asset limit

In some cases, MassHealth is effectively re-evaluating eligibility from scratch, which can create stress and delays if records are not readily available.

Favorable Gift Treatment May Be Ending Soon

For anyone applying for Medicaid to pay for nursing home care, any gifts made within five years of applying for benefits are penalized, making it very difficult, if not impossible, to qualify for Medicaid benefits to pay for care.

However, in certain circumstances, gifts for MassHealth applicants to help them live at home were not subject to a penalty period.  Given the recent changes, I would not be surprised if this favorable treatment were to change soon. 

If that happens:

• Gifts may once again create penalty periods

• Prior planning strategies may no longer work

• Families who wait may lose valuable planning options

I am watching this closely. However, I recommend getting ahead of this, as changes often occur before our clients have time to act.

What These MassHealth Changes Mean for You

MassHealth planning in Massachusetts is becoming:

• More documentation intense

• More technical

• Less forgiving of mistakes

Whether you are:

• Worried about paying for the high cost of long-term care

• Applying for MassHealth

• Responding to a redetermination

• Enrolled in or considering PACE

• Relying on gifting or asset-reduction strategies

Now is the time to make sure your plan still works under today’s rules. 

Next Steps: How We Can Help

We are actively updating our MassHealth planning strategies to reflect these changes.

If you or a family member:

• In need of help to stay at home, an assisted living, or a nursing home, and concerned about how you will pay for it.

• Have an existing MassHealth plan

• Are in the middle of an application

• Have received new requests from MassHealth or PACE

• The spouse of someone receiving PACE, paid for by MassHealth

We strongly recommend scheduling a meeting to assess your situation and identify next steps. Things are changing quickly. Proactive planning can help protect your assets.  Click on the button below to schedule a meeting with one of our attorneys.

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Senior Solutions, Attorneys at Law, is an Estate Planning and Elder Law firm serving the Greater Boston, Massachusetts area since 2001. We are ready to help you with Medicaid Planning, Estate Planning, Probate, Guardianship & Conservatorships, Special Needs Trusts, and Fiduciary Services. We are here to help. Please call our office at 617-489-5900 or schedule a brief consultation by clicking the button above.