People impoverished in some nursing homes

Across the US, hundreds of thousands of nursing home residents are locked in a wretched bind: Driven into poverty, forced to hand over all income and left to live on a stipend as low as $30 a month.

In a long-term care system that subjects some of society’s frailest to daily indignities, Medicaid’s personal needs allowance, as the stipend is called, is among the most ubiquitous, yet least known.

Nearly two-thirds of American nursing home residents have their care paid for by Medicaid and, in exchange, all Social Security, pension and other income they would receive is instead rerouted to go toward their bill. The personal needs allowance is meant to pay for anything not provided by the home, from a phone to clothes and shoes to a birthday present for a grandchild.

One problem: Congress hasn’t raised the allowance in decades.

“It’s really one of the most humiliating things for them,” says Sam Brooks, an attorney for The National Consumer Voice for Quality Long-Term Care, which advocates for nursing home residents and has urged an increase in the allowance. “It can really be a point of shame.”

Especially when an individual has no close relatives or no one able to financially help, the allowance can breed striking need. When Marla Carter visits her mother-in-law at a nursing home in Owensboro, Ky., the scene feels more 19th-century poorhouse than modern-day America. With just a $40 allowance, residents are dressed in ill-fitting hand-me-downs or hospital gowns that drape open. Some have no socks or shoes. Basic supplies run low. Many don’t even have a pen to write with.

“That’s what was so surprising to us,” Carter says, “the poverty.”

She was so horrified that she and her husband started a nonprofit, Faithful Friends Kentucky, to distribute items to area nursing home residents. Among the things most warmly received are Kleenex tissues, because facilities often stock scratchy generics and even those can be hard to come by.

“You bring a soda or a toothbrush and they’ll get so excited,” she says. “It’s so sad to me.”

Medicaid was created in 1965 as part of the Great Society programs of Lyndon B. Johnson. A 1972 amendment established the personal needs allowance, set at a minimum of $25 monthly. Unlike other benefits like Social Security, cost-of-living increases were not built into personal needs allowance rules.

Had it been linked to inflation, it would be about $180 today. But Congress has raised the minimum rate only once, to $30, in 1987. It has remained there ever since.

Some politicians have tried to fix the problem, including Rep. Jennifer Wexton, a Democrat from Virginia who in 2019 introduced a bill to raise the minimum allowance to $60 and cement annual increases tied to those for Social Security. It didn’t even get a hearing.

“I was shocked,” Wexton says. “It’s about dignity for these people.”

Medicaid is jointly administered between individual states and the federal government and, faced with federal inaction, states have taken it upon themselves to raise allowances.