Glossary

Medicaid Spend-Down

Definition
The process of reducing assets and income to meet Medicaid's eligibility limits — usually by paying medical expenses, modifying a home, or using legally permitted asset transfers.

To qualify for Medicaid long-term care, an applicant typically must have very limited assets (often $2,000 in countable assets for a single person). Spend-down is the legal process of reducing assets to that limit.

Allowed spending includes medical expenses, paying off debt, home repairs and modifications, prepaying funeral expenses, and (in some cases) transfers to a community spouse. Improper transfers can trigger the look-back penalty.

See also

Related terms

  • Look-Back Period (Medicaid) — The five-year window before a Medicaid long-term care application during which any uncompensated transfers — gifts, transfers below market value — are reviewed and can trigger a penalty period of ineligibility.
  • Long-Term Care — Personal and medical care provided over an extended period to someone who cannot fully care for themselves — at home, in assisted living, or in a nursing home.

Sources

Sandwich is a directory and information site. This glossary is not legal, medical, or financial advice. For decisions that affect your family, consult a licensed professional. Editorial policy.

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