Medicaid Personal Needs Allowance (PNA): A Tutorial

Long term residents who are living in a skilled nursing facility under Medicaid, are given a monthly monetary allocation called PNA (Personal Needs Allowance). These monies are to be used by the resident at their own discretion and is available to the resident through the Social Service department.

There is much ambiguity and confusion surrounding PNA, including what it covers, how it is accessed, where it is taken from and what happens to it when the resident expires.


Nursing home residents supported by Medicaid are entitled to maintain a small personal funds accounts, to be used for personal preference items. Many facilities also manage personal funds for Medicare and privately funded residents.

The monthly amount and the allowable maximum depends on state regulations. The fiduciary standards are found in federal and state regulations and in state theft laws.

Residents are not required to entrust personal funds to the facility, but many do. Residents often have no one willing or able to maintain the funds. Most do not have a formal guardian, many have no formal general power of attorney, and many cannot depend on family either to maintain the funds or to do the shopping. Many residents do not have the cognitive ability to maintain or monitor their personal funds. These factors create inherent financial vulnerabilities.

The operational details for compliance can be found in the state regulations. If a facility has been cited previously on this issue, strict compliance becomes even more important.


A Medicaid resident has the right to a small personal allowance each month, usually from his/her Social Security income, to use for personal purposes. The resident may entrust the funds to the facility, but is not required to do so. The facility is required to accept and serve as fiduciary for those residents. The allowable amount is set by the state.

A resident who is self-financing may also choose to have the facility serve as fiduciary. This requires an enhanced set of policies and should be approached with caution.

The resident has wide latitude in selecting personal purchases. Just about anything is allowable if the resident can afford the product or service and it does not violate physician orders.

The facility cannot use the personal funds to purchase supplies or services that must be provided by the facility. State regulations specify which items must be provided by the facility and that cannot be purchased with personal funds.

Read more via this excellent article by  Tom Ealey, CPA, and Marcy Corbat

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