Nursing Home Level of Care, Explained

Long-Term Care Medicaid has a medical test as well as a financial one. For nursing home Medicaid, and for most home and community-based waivers, the applicant must need nursing home level of care, often shortened to NFLOC (nursing facility level of care). A person can have very little money and still be denied if they do not need enough care. This guide explains what level of care means, how it is assessed and how families can prepare.

Figures change periodically. Double-check current amounts before relying on them.

What “level of care” means

Federal law requires Medicaid to cover nursing facility services for people who need them, but it leaves the definition of need to each state. Every state has written criteria, usually in its Medicaid rules or manual, describing who needs the kind of care a nursing home provides. The same criteria usually apply to waivers that serve people who would otherwise need a nursing home, because those programs are meant to offer an alternative to nursing home care.

There is no single national definition. But most states look at the same four areas.

The four areas states look at

1. Activities of daily living (ADLs)

These are the basic tasks of self-care:

bathing;
dressing;
eating;
using the toilet;
transferring (getting in and out of a bed or chair);
continence;
in many states, walking or mobility.

Most states require a person to need hands-on help or supervision with a certain number of ADLs, often two or three. See Activities of daily living.

2. Cognitive impairment

Many people with dementia can physically perform tasks but cannot do them safely without reminders or supervision. States usually count this. Signs include memory loss that affects safety, poor judgment, getting lost, and inability to manage medications.

3. Behavior

Behaviors that put the person or others at risk, such as wandering, aggression or resisting care, often count toward level of care.

4. Skilled medical needs

Some people meet the test because they need daily skilled nursing tasks, such as complex wound care, tube feedings, injections that cannot be self-administered, or monitoring of an unstable condition.

How the assessment works

Request or referral. The assessment is usually triggered by the Medicaid application, a hospital discharge planner, a nursing home, or a request to the state or its contractor.
The assessor. A nurse or social worker, employed by the state, a county agency, an Area Agency on Aging or a contractor, conducts it.
The tool. The assessor uses a standard state form. Questions cover ADLs, memory, behavior, medical conditions and medications.
Where. Often in person at the hospital, nursing home or home. Some states use phone or video for parts of it.
Records. The assessor reviews medical records and may talk with the person’s doctor and family.
Decision. The state applies its criteria and sends a written notice.

For nursing home admissions, a separate federal screening called PASRR (Preadmission Screening and Resident Review) checks every applicant to a Medicaid-certified nursing facility for serious mental illness or intellectual disability, to make sure they get the right services. It is not a level of care test, but families may hear about it at the same time.

Preparing for the assessment

Assessments are often short, and people tend to present their best selves to a stranger. Many older adults say “I can do that myself” about tasks they actually struggle with. Families can help the assessor see the whole picture:

Be present. A family member who knows the person’s daily routine should attend if allowed.
Describe a typical day, including bad days. If the person needs help some days but not others, say so.
Be specific. “She needs help getting into the shower and someone to stand by because she has fallen twice” is more useful than “she needs some help.”
Mention supervision. If the person can do a task only with reminders or someone watching, it counts.
Bring records. A list of diagnoses, medications, recent hospital stays and falls helps.
Get a doctor’s letter. A letter describing the person’s needs and the reasons can carry weight.
Keep a log. A week or two of notes on falls, confusion, incontinence and help given is valuable evidence.

Honesty matters. The goal is an accurate picture, not exaggeration.

A worked example

Frances, 86, lives alone. She has moderate dementia and arthritis. She can feed herself but:

needs someone to help her in and out of the tub, because she fell last spring;
puts on clothes in the wrong order or wears the same clothes for days unless reminded;
forgets whether she has taken her pills and has doubled doses twice;
has gotten lost driving to the grocery store.

In a short assessment, Frances says she bathes and dresses herself. Her daughter, who attends, explains the help she actually gives and brings a log of the last two weeks and a letter from the doctor. The assessor records that Frances needs help with bathing and dressing, and supervision because of cognitive impairment. Frances meets her state’s level of care for the home care waiver.

If the person is found not to meet level of care

Read the notice. It should explain the reason and the appeal deadline.
Appeal promptly. Deadlines are often short. Many states continue existing services if the appeal is filed quickly.
Get more evidence. A detailed doctor’s letter, therapy notes and a care log can help.
Ask for a reassessment if the person’s condition changes.
Look at other programs. Some states offer lower-level home care through regular Medicaid or state-funded programs for people who do not meet NFLOC.

Level of care at renewal

Level of care is usually reviewed periodically, often once a year for waiver services. Nursing home residents are reviewed through the facility’s own assessments. A person who improves may no longer meet the criteria, which can affect coverage. Families should be ready for reassessments and keep notes up to date.

Level of care for different programs

Program	Typical medical test
Nursing home Medicaid	Nursing home level of care
HCBS waiver for older adults	Nursing home level of care, usually the same criteria
State plan personal care	Often a lower need, such as help with one or two ADLs
Assisted living waiver services	Usually nursing home level of care
PACE	Nursing home level of care, plus able to live safely in the community at enrollment

Common questions

Does a dementia diagnosis automatically qualify? No. The assessment looks at how the condition affects daily life and safety, not just the diagnosis.

Does Medicare’s skilled nursing standard matter? No. Medicare’s rules for a skilled nursing stay are different. A person may not need skilled care under Medicare yet meet Medicaid’s level of care, and the reverse.

Can I pick the assessor? Usually not. The state or its contractor assigns one.

What if my parent is already in a nursing home paying privately? The facility’s records and assessments help. The state will still make its own determination when Medicaid is requested.

How long is the assessment good for? It depends on the state. If the application is delayed, the assessment may need to be updated.

Where a planner helps

A Certified Medicaid Planner (CMP) usually focuses on the financial side, but a good planner also knows how the state’s medical test works, what evidence helps and how to time the assessment with the application. The two tests must both be met in the same month for coverage to start.

Questions to ask the assessor or agency

What criteria will be used, and can I see them?
Can a family member attend?
Will you review the doctor’s records, or should we bring them?
When will we get a decision, and in what form?
If the person does not qualify, what other programs might fit?

Level of care and the money test together

Coverage starts only when both tests are met. A family that spends down savings before the person meets level of care may end up with no savings and no Medicaid. And a person who meets level of care but still has too many assets will be denied on the financial side. Timing both together avoids gaps.

A note on hospital discharges

When a person is leaving the hospital and cannot safely go home, the discharge planner may arrange the level of care screening quickly so a nursing home can admit them. Ask the planner which screening has been done and request a copy for your records. It will be useful for the Medicaid application.

Last updated for 2026. General information only, not legal or financial advice. Medicaid Answers is a free educational resource published by Medicaid Answers Foundation.