If your income is just too high for you to be eligible for Medicaid, then you may want to look at Spend Down and other similar programs which are offered in some states in the US.
If you spend your excess income (the amount over the eligibility limit) on “non-covered” medical expenses, you could then qualify for Medicaid.
If you have applied for Medicaid and have been denied full coverage under their program, you will be informed if you qualify for a Spend Down, and you will also be told how much you will need to spend on medical expenses to qualify for Medicaid.
Who can get a Spend Down ?
Only the following groups can get a “spend down” –
- Children under 21 years of age
- Adults over 65
- Individuals who are disabled or blind
Income Spend Down
“Spend Down” has two types of program –
- Income Spend Down
- Asset Spend Down
“Income Spend Down” is the type of program I am briefly looking at here, and is the one I have been referring to so far.
If you have assets which are too valuable, or your combined assets and income are too high, you need to look into “Asset Spend Down”, which is present in all states.
The period over which the income is looked at, for Income Spend Down, can be from 1 month to 6 months.
If you live in a state in which the period is 1 month, you are going to have to “spend down” to the Medicaid eligibility limit on a monthly basis in order to qualify for Medicaid each separate month.
As you can imagine it can get a little complicated, and particularly if you don’t have enough “non-covered” medical expenses in any one month to “spend down”, as you won’t qualify for medicaid that month.
An example of how a “Spend Down”works –
Mary did not qualify for Medicaid as her monthly income was 75$ above the limit of Medicaid eligibility.
If Mary has “non-covered” medical expenses of 75$ which she pays, this is her “spend down”, and Medicaid will cover any other qualifying medical bills.
If Mary has 120$ of”non-covered” medical expenses, she will only pay the 75$, and Medicaid will cover the remaining 45$ (so long the bills are from a Medicaid approved provider) – Mary pays her 75$ “spend down”, bringing her down to the Medicaid eligibility limit and the Medicaid coverage kicks in for the remainder.
Of course, this only works for the types of medical expenses that Medicaid will cover.
What types of medical expenses qualify for an Income Spend Down ?
Typically, although it may vary by state, the following types of bills can count towards a “spend down” –
- doctors visits
- dental visits
- opticians visits
- prescription drugs
- cost of transportation to and from medical appointments
- a nurse or therapist prescribed by a doctor
- all health insurance coinsurance payments and deductibles – Meaning that only the part of the bill your insurance provider did not pay for is eligible to be included in your “spend down”
- family members medical bills – this can be a spouse, or children under the age of 21, and the children do not have to be living at home with you
- unpaid medical bills can also be part of a “spend down”
*** Do note that where the medical expense bills which are counting towards your “spend down” do not have to be from a Medicaid approved provider, once you have qualified for Medicaid, it will only cover your bills from Medicaid approved providers.
Other names for the Spend Down Program
“Spend Down” programs across different states have a few different names, and may also be called “Surplus Income Program”, “Share of Cost Program”, “Excess Income Program” and “Medically Needy Program”.
Free help with understanding Spend Down ?
You can get free help and guidance on Medicaid (although not legal advice) from your SHIP (State Health Insurance Program).
SHIP offers free counseling over the phone, on matters concerning Medicaid, Medicare and Medigap.
I have a brief article which tells you how to find your SHIP and their contact information. You can find that here.
Although it is not free, you may find that you need more help, and a good place to start may be with a Medicaid Planner, an Elder Resource Planner, or a Life Resource Planner.
The American Council on Aging website has more information about Medicaid Planners, here.
If you wish to find a Medicaid Planner you can use a free tool on the American Council on Aging website which will (1) determine your eligibility status, and (2) find you a Medicaid Planner – you can find that here.
This is not to say that you cannot simply get help from your State Medicaid admin and then work through it all with your Medicaid caseworker.
I’m Gareth, the author and owner of Looking After Mom and Dad.com
I have been a caregiver for over 10 yrs and share all my tips here.