Medicaid Spend Down

What is a Medicaid Spend Down and how does it work?

Some people have too much income to qualify for Medicaid. This amount is called excess income. Some of these people may qualify for Medicaid if they spend the excess income on medical bills. This is called a spend down.

For example, a person over 65 is denied Medicaid because her monthly income is $50 more than the limit for Medicaid eligibility. If she incurs medical bills of $50 per month, the rest of her medical bills will be covered by Medicaid. The spend down in this case is the $50 of medical bills she incurs.