Where to start › When the money runs out › Spending down
Spending down to qualify
"Spend-down" is just the word for becoming eligible for Medicaid by bringing countable assets down to your state's limit — usually by spending on care and other allowed things. It is a normal, legal, expected part of how long-term care gets paid for in America.
The idea
Medicaid is for people with limited resources, so there are income limits and asset limits. To qualify for long-term-care Medicaid, an applicant generally has to be under both. "Spending down" means using the person's own money on their care and other permitted expenses until they reach the limit — at which point Medicaid can begin to pay.
Not everything counts. Some assets are usually "exempt" — often a home (within limits, and especially when a spouse lives there — see what happens to the house), one vehicle, and personal belongings. The exact limits, and what counts, vary by state and change each year.
The catch worth knowing
You generally cannot just give money or property away to get under the limit — that runs into the five-year look-back and can create a penalty period. There are legitimate, legal ways to structure a spend-down, but they depend on your state and your specific situation, and getting them wrong is expensive. This is the point in the road where an elder-law attorney earns their fee.
Where the public record stops — and who to ask
What are the exact income and asset limits, and what's the smart way to spend down, in your situation? That answer depends on your state and your situation, and it belongs to the people who decide it — not to us. Here is who has it, and exactly what to ask so you arrive prepared instead of lost.
Who to ask: your state Medicaid office for the limits; an elder-law attorney (or a free SHIP/benefits counselor) for how spend-down works in your case.
What to ask them:
- What are my state's current income and asset limits for long-term-care Medicaid?
- Which of our assets are exempt, and which count?
- What are legitimate things we can spend down on right now?
- Should we talk to an elder-law attorney before we spend or move any money?
You now know more than most people who walk into that office. That is the whole point of this page.
Who helps you locally — free, and on your side. You do not have to figure this out alone. Your Area Agency on Aging gives free options counseling; reach any of them through the federal Eldercare Locator at 1-800-677-1116 or eldercare.acl.gov (Administration for Community Living). More on the four people who help — and what each one does — on Who helps me locally.