Spending Down Assets to Qualify for Medicaid

In order to be eligible for Maryland Medical Assistance (Medicaid), applicants must have no more than $2,500 in “countable” assets (the dollar figure may be slightly more, depending on the state). Applicants for Medicaid and their spouses may protect savings by spending them on non-countable assets. The following are examples of such expenditures:

    prepaying funeral expenses

    paying off a mortgage

    making repairs to a home

    replacing an old automobile

    updating home furnishings

    paying for more care at home

    buying a new home

In the case of married couples, it is often important that any spend-down steps be taken only after the unhealthy spouse moves to a nursing home if this would affect the community spouse’s resource allowance.

David Wingate is an elder law attorney in Frederick and Montgomery Counties, Maryland. His law practice includes wills, powers of attorneys, trusts, asset protection and Medicaid.