How to Spend Down to Medicaid Eligibility
- 1). Total the value of your countable assets (resources). Countable assets are items such as checking and savings accounts, IRAs, 401ks, brokerage accounts, second vehicles, cash value life insurance (with some exceptions), certain real estate, oil and gas interests, and other liquid assets.
- 2). Convert countable resources into non-countable resources for Medicaid eligibility purposes. For example, purchase pre-need irrevocable funeral contracts or buy a burial plot.
- 3). Pay off all debts to reduce liquid cash and assets to below $2,000, the federal Supplemental Security Income resource standard limit. Pay outstanding medical bills and nursing home bills first. If you have assets remaining, pay any consumer debts for which the applicant is legally responsible.
- 4). Make reasonable repairs to your homestead. Reasonable repairs include fixing a leaky roof or replacing flooring. Expansions to the home are generally considered unreasonable, however making a homestead wheelchair accessible may be approved.
- 5). Prepay up to one year of property taxes, car insurance and other upcoming known expenses (as allowed by your state Medicaid rules).
- 6). Purchase a new vehicle to replace an old car. One automobile is exempt if the nursing home applicant is married and the spouse lives at home. If the nursing home resident is single, the applicant may have one automobile with a value of up to $4,500, or a vehicle of unlimited value if it is medically equipped to transport the applicant.
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