TennCare CHOICES Groups 1, 2, and 3: What Each Covers and Who Qualifies

Three Groups, Three Very Different Levels of Coverage

TennCare CHOICES is Tennessee's managed care Medicaid program for long-term services and supports, operated by three managed care organizations: BlueCare, UnitedHealthcare Community Plan, and Wellpoint Tennessee. What most families don't realize until they're deep in the application process is that CHOICES isn't one program — it's three separate enrollment groups with different services, different eligibility requirements, and fundamentally different enrollment structures.

Understanding which group your parent qualifies for determines not just what services they'll receive, but whether they'll face a waiting list, a cost cap on their care plan, or both.

Group 1: Nursing Facility Care

Group 1 covers long-term care delivered inside a Medicaid-certified nursing facility. This is the group that most families associate with "Medicaid covering the nursing home."

Key features:

• Covers the full cost of nursing facility room, board, and care
• Federal entitlement — no enrollment caps, no waiting list. If your parent is clinically and financially eligible, they must be enrolled
• Requires a PAE acuity score of 9 or higher (nursing home level of care)
• The resident keeps a $70/month Personal Needs Allowance; the rest of their income goes to the facility as "patient liability"

Group 1 is the pathway families land on when home-based care is no longer safe or feasible. Because it's a federal entitlement, the state cannot limit the number of people enrolled or maintain a waiting list — a critical difference from Groups 2 and 3.

Group 2: Home and Community-Based Services

Group 2 is the program families want but often can't access quickly. It covers home and community-based services (HCBS) for seniors age 65+ or adults 21+ with physical disabilities who clinically require a nursing home level of care but choose to receive services at home or in an approved assisted living facility.

Key features:

• Covers in-home personal care, attendant services, home modifications, adult day care, and assisted living facility placement
• Requires the same PAE acuity score of 9 or higher as Group 1
• Not a federal entitlement — operates under a statewide enrollment cap (historically targeted at 12,500 slots) with active waiting lists
• Subject to a cost-neutrality cap: the individual care plan cannot exceed $294.87 per day ($107,627.55 per year for 2026). If care costs exceed this threshold, the member must transition to Group 1 nursing facility care
• Enrollees keep a Community Personal Needs Allowance of $2,982/month (the full Special Income Standard), which is dramatically more than the $70 Group 1 nursing home PNA

The cost-neutrality cap is the policy mechanism that keeps Group 2 economically viable for the state: it ensures that no home-based care plan costs more than the equivalent nursing facility placement. For many families, the math works — in-home care for a parent with moderate needs costs substantially less than facility placement. For parents who need round-the-clock skilled nursing, the cap may force a transition to Group 1.

The waiting list is the practical barrier. Families whose parent qualifies clinically and financially may still wait months for a Group 2 slot to open. During that waiting period, families either pay for care out of pocket or accept Group 1 nursing facility placement if the parent's needs are urgent.

Group 3: At-Risk Community Services

Group 3 covers limited home and community-based services for individuals who don't meet the full nursing home level of care but are determined to be "at risk" of institutionalization.

Key features:

• Covers a narrower range of HCBS — typically personal care, homemaker services, and limited adult day care
• Services are capped at approximately $18,000 per year
• PAE acuity score does not need to reach 9, but the applicant must demonstrate they are at risk of needing institutional care without support
• Severely limited enrollment — new enrollment is restricted primarily to individuals receiving SSI cash benefits, with a small number of non-SSI slots (historically targeted at 1,750) subject to state appropriations

Group 3 is the right fit for a parent who needs some help with daily activities — bathing, meal preparation, medication reminders — but isn't at the point of needing full-time nursing care. The $18,000 annual cap translates to roughly $1,500 per month in services, which is enough to cover part-time in-home aide visits but not 24-hour care.

The Safety Determination: When the Score Falls Between 5 and 8

A parent who scores between 5 and 8 on the PAE acuity scale doesn't clinically qualify for Group 1 or standard Group 2. But there's a secondary pathway: the Safety Determination.

Under TennCare Rule 1200-13-01-.05(6), a physician can request a Safety Determination by submitting evidence that the applicant cannot be safely cared for under the limited Group 3 budget. The determination may be approved if the applicant meets specific criteria:

• A mobility/transfer score of at least 3, where lack of physical assistance creates imminent risk of serious injury
• A toileting score of at least 2, where unsupervised toileting creates immediate health risk
• An orientation score of at least 3 or a behavior score of at least 2, where lack of continuous supervision creates imminent risk of harm
• A pattern of recent emergency hospitalizations, severe falls, or active Adult Protective Services intervention

If the Safety Determination is approved, the parent gains access to Group 2 services — bypassing the standard PAE score threshold. This pathway exists because clinical acuity scores don't always capture the full picture of a parent's safety risks at home.

Financial Eligibility Applies to All Three Groups

Regardless of which group your parent targets, the 2026 financial requirements are the same:

• Monthly income cap: $2,982 (300% of SSI Federal Benefit Rate)
• Countable asset limit: $2,000 for a single applicant
• Community Spouse Resource Allowance: Up to $162,660 for the non-applicant spouse
• Spousal Income Allowance: Up to $4,066.50/month

If your parent's income exceeds $2,982, a Qualified Income Trust (Miller Trust) is the only path to eligibility — Tennessee does not allow adults to spend down excess income month by month.

Managing the TennCare CHOICES application, the QIT setup, and the ongoing financial reporting typically requires a Durable Financial Power of Attorney with explicit authority for trust creation and asset management. The Tennessee Power of Attorney & Guardianship Kit covers the legal authority setup and the TennCare CHOICES financial framework together.

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