The Do’s and Don’ts of a Medicaid Spend Down

If you or a loved one is likely going to need to enter a long-term care facility, it is important to get on Medicaid as quickly as possible. Medicaid will pay most of the expenses associated with the long-term care facility so that it doesn’t have to come directly out of your pocket. In order to qualify for Medicaid, however, you need to ensure your total countable assets and monthly income are below specific thresholds.

If they are not, you’ll have to do what is commonly called a Medicaid spend down. This is a process where you intentionally reduce your monthly available income (income minus approved expenses) and your total countable assets. Once you understand the proper ways to do this, it can be a simple process.

Things You Should Do

When working on a Medicaid spend down, the following options can not only help get the income to the desired point, but can help your overall financial position as well:

  • Make Payment Arrangements – Setting up monthly payments on past medical debt is a great way to reduce your monthly available income.
  • Pay Ahead on Eligible Bills – If you need to reduce the amount of cash you have on hand, consider making extra principal payments on your mortgage or auto loans.
  • Purchase Non-Countable Assets – Certain assets (cars, furniture, appliances) don’t count when calculating assets for determining Medicaid eligibility. If you may need them in the future anyway, it may make sense to buy them now to reduce your total Medicaid counted assets.

Things You Should NOT Do

While some of these may be tempting, they can actually cause your financial future more harm than good. With that in mind, make sure to avoid these mistakes when performing a Medicaid spend down:

  • Gift Away Money – While there are some situations where you can give money to a loved one, it likely isn’t going to qualify as part of the Medicaid spend down (except in rare circumstances).
  • Nothing – Doing nothing is the worst option you have. Those who do nothing will end up having to pay for the long-term care expenses out of their own pocket until they reach the necessary asset levels to qualify for Medicaid. This can waste huge amounts of money very quickly.
  • Try to Handle it Alone – The laws and regulations surrounding Medicaid spend downs are quite complex. Trying to handle it all on your own leaves you susceptible to mistakes, which can be quite costly. Having an elder law attorney there to help can ensure everything goes smoothly.

Contact Us for Help

If you are going through a Medicaid spend down, or may need to soon, make sure you get in touch with us right away. When you contact ProActive Legal Care Law Office, LLC to set up a consultation to go over your current financial situation and help you to make the best decisions on how to complete the spend down successfully.

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