Countable vs Exempt Assets for Delaware Medicaid: What Counts Against You

The $2,000 Line

Delaware Medicaid long-term care requires a single applicant to hold no more than $2,000 in countable resources on the day eligibility is determined. For a married couple where both spouses are applying, the joint limit is $3,000.

Not every dollar the applicant owns counts toward that limit. Delaware Medicaid divides all assets into two categories — countable and exempt — and only the countable total must fall below the threshold. Understanding which category each asset falls into determines whether a spend-down is needed and how much.

What Counts (Countable Assets)

These assets are added up and measured against the $2,000 limit:

• Checking and savings accounts — the full balance on the date of determination
• Certificates of deposit (CDs) — full value, regardless of early withdrawal penalties
• Investment accounts — stocks, bonds, mutual funds, brokerage accounts
• Cash value of life insurance — whole life, universal life, and variable life policies with a cash surrender value may be countable. Term life policies with no cash surrender value are not countable.
• Retirement accounts owned by the applicant — IRAs, 401(k)s, and pensions with a lump-sum withdrawal option
• Real estate other than the primary residence — rental properties, vacant land, vacation homes, commercial property
• Promissory notes, loans owed to the applicant, and land contracts
• Savings bonds

What Does Not Count (Exempt Assets)

These assets are excluded from the $2,000 calculation:

Primary residence — exempt if the applicant lives in it or states an intent to return home, provided the equity interest does not exceed $752,000 (Delaware's 2026 limit). If a spouse, minor child, or disabled child resides in the home, the equity cap does not apply — the home is fully exempt regardless of value.

One vehicle — one automobile of any value is exempt. If the applicant owns two vehicles, the one with the higher fair market value is typically designated as the exempt vehicle, and the second is countable.

Household furnishings and personal effects — furniture, clothing, electronics, and personal items are exempt without a dollar limit.

Term life insurance — policies with no cash surrender value are not countable, regardless of the face amount.

Irrevocable prepaid funeral trusts — up to $15,000 per person. Must be irrevocable and specifically designated for funeral and burial expenses.

Community spouse's retirement accounts — this is a significant Delaware-specific protection. When only one spouse is applying for Medicaid, the non-applicant spouse's IRAs and 401(k)s are entirely excluded from the applicant's eligibility determination. This can shelter tens or hundreds of thousands of dollars that would otherwise force a spend-down.

The Joint Account Trap

Joint bank accounts are one of the most common eligibility problems. DMMA's default rule: a joint account is presumed to be 100% owned by the Medicaid applicant unless the other account holder can prove they contributed their own funds.

This means a $50,000 joint checking account that a parent shares with an adult child is treated as $50,000 of the parent's countable assets. The child's claim that "half of that is mine" is not enough — DMMA requires documentation showing the source of each deposit.

If your parent holds a joint account, you have two options before applying:

1. Document ownership — Gather bank statements showing which deposits came from the parent and which came from the other account holder. DMMA will reduce the countable amount to the parent's documented share.
2. Separate the accounts — Split the joint account into individual accounts, transferring only the documented non-parent funds to the other person's account. This removes the presumption entirely.

Do not simply remove your parent's name from the account and transfer the full balance to the other holder. DMMA will treat that as a transfer of assets within the lookback period, potentially triggering a penalty.

What About the Car?

One vehicle is exempt. This is true regardless of make, model, or market value — a $5,000 sedan and a $60,000 SUV receive the same treatment. The exemption applies to the vehicle the applicant or their spouse uses for transportation.

If the applicant owns a second vehicle (or a recreational vehicle, boat, or motorcycle), the fair market value of the additional vehicle is countable. Selling the second vehicle and using the proceeds for a compliant spend-down (funeral trust, debt payoff, home repairs) is a common pre-application step.

Vehicles titled solely to the community spouse are generally treated as the spouse's property and protected under the Community Spouse Resource Allowance, so they may not count against the applicant at all.

Planning Around These Rules

The asset classification rules create a clear checklist for families preparing a Medicaid application. Identify each asset, classify it as countable or exempt, total the countable column, and determine how much needs to be spent down to reach $2,000.

The Delaware Medicaid Long-Term Care & Asset Protection Guide includes an asset inventory worksheet and a step-by-step spend-down planner that walks through each category with the Delaware-specific rules and exemption limits.

See more Delaware guides →