Spend-Down Estimator

Most people who apply for Long-Term Care Medicaid must first bring their countable assets down to the state’s limit, often about $2,000 for a single person. This is called the spend-down. This estimator shows roughly how much may need to be spent down and how long that money would last if it were used only to pay for care privately. It also explains the allowed ways to spend down, which can often protect more value than simply paying the nursing home. Nothing you enter is stored or sent anywhere.

Figures change periodically. Double-check current amounts before relying on them.

The estimator

Total countable assets of the applicant (for a married couple, use the amount left after the spouse at home’s protected share) ($) Your state’s asset limit for the applicant ($) Monthly cost of care if paying privately ($) Applicant’s monthly income available toward care ($)

What the result means

The amount above the limit is roughly what needs to be spent, converted to an exempt form, or otherwise addressed before Medicaid will pay. The months of private payment shows how long the excess would last if it were used only to pay the gap between income and the cost of care. That number is a useful warning: for many families, the excess would last only months, which is why planning the spend-down matters.

Countable and exempt assets

Before using the estimator, separate countable assets from exempt ones.

Usually countable:

checking and savings accounts, CDs and money market accounts;
stocks, bonds and mutual funds;
retirement accounts in many states;
cash value of life insurance above a small amount;
real estate other than the home;
a second vehicle.

Usually exempt:

the home, in many situations, subject to the equity limit;
one vehicle;
personal belongings and household goods;
an irrevocable prepaid funeral plan and burial spaces;
a small burial fund;
certain income-producing or self-support property.

See What counts as an asset and Exempt assets.

Allowed ways to spend down

Paying the nursing home or care provider privately is one way to spend down, but often not the best one. Allowed spend-down can include:

paying off debts, such as a mortgage, car loan or credit cards;
home repairs and improvements to an exempt home: a new roof, furnace, accessibility changes;
buying a more reliable vehicle, if the exempt vehicle needs replacing;
prepaying funeral and burial expenses with an irrevocable plan;
buying medical equipment, hearing aids, dental work or eyeglasses not covered by insurance;
buying clothing, furniture and personal items for the applicant;
paying for legal and planning help;
for married couples, steps that increase what the spouse at home keeps, within the rules.

Purchases must be for the applicant (or the spouse) and at fair value. Gifts to family members are not allowed spend-down and can cause a penalty. See Allowed spend-down.

Example

Margaret is single and lives in a nursing home that costs $9,500 a month. Her income is $2,200 a month. She has $62,000 in savings and a car. Her state’s limit is $2,000. Her excess is $60,000, and the monthly shortfall is $7,300, so if she simply paid privately, her excess would last about 8.2 months. Instead, her family pays off her $4,000 credit card balance, buys an irrevocable funeral plan for $9,000, replaces her hearing aids for $5,500 and buys new clothing and a wheelchair-accessible recliner. That uses $20,000 for things she needs, and the remaining $40,000 pays for about 5.5 months of care. Medicaid then begins paying, with her income going toward the cost each month.

Married couples

For a married couple, the spouse at home’s protected share (the CSRA) is set aside first. Only assets above that share and the applicant’s own limit need to be spent down. In some cases, lawful planning, such as a Medicaid-compliant annuity for the spouse at home, can protect much more. Use the Spousal allowance calculator first, then enter the remainder here. See Spousal impoverishment.

Income spend-down (medically needy states)

In states with a medically needy pathway, people whose income is above the limit can qualify by “spending down” income on medical costs each month. For nursing home residents, the cost of care is usually so high that this happens automatically. This estimator is about assets, not income. See Income spend-down.

Timing

Assets are usually counted at the start of the month. Spending down late in the month generally helps only the next month.
Keep receipts for everything. The caseworker will ask.
Do not overspend. Spending below the limit has no Medicaid benefit and leaves less for personal needs.
Apply as soon as assets are at the limit, to protect retroactive coverage.

A spend-down planning worksheet

Work through these questions before spending anything.

What exactly is countable? List each account and asset, its value on a recent statement and whether it is countable or exempt in your state.
What does the applicant need? Think about the next few years: clothing, hearing aids, dentures, eyeglasses, a wheelchair or walker, a hospital bed, a television or radio for the room, personal items.
What does the home need? If the home is exempt, list repairs and improvements: roof, furnace, water heater, ramps, grab bars, a walk-in shower. See Home modifications and equipment.
What debts can be paid? Mortgage, home equity loans, car loans, credit cards, medical bills, taxes owed.
Is a funeral plan in place? An irrevocable prepaid funeral plan, and burial spaces, are usually exempt.
Does the vehicle need replacing? One vehicle is usually exempt.
Is there a spouse at home? Plan purchases and steps that help the spouse at home within the rules.
What will be left? Subtract the planned purchases from the excess. The rest will pay for care until the limit is reached.

Records to keep

The caseworker will want to see where the money went. Keep:

receipts and invoices for every purchase;
the funeral contract, showing it is irrevocable;
contractor invoices and proof of payment for home repairs;
loan payoff letters and final statements;
bank statements showing each payment;
a simple list matching each withdrawal to a receipt.

Pay by check or bank transfer, not cash, so each payment is easy to trace.

Questions to ask before spending

Is this purchase for the applicant (or the spouse at home), at fair value?
Would the caseworker see it as a reasonable need, or as a gift in disguise?
Is the item exempt once bought? For example, a second car generally is not.
Will it still matter if the applicant does not return home?
Is there a simpler or cheaper way to meet the same need?
Could the same money protect more if used in a planning step a professional recommends?

Common spend-down mistakes

Paying a family member without a written agreement. Payments for care can be legitimate, but without an agreement and records they may be treated as gifts. See Caregiver agreements.
Buying items for others, such as a car for a grandchild.
Prepaying many months of care that has not been provided.
Paying cash with no receipts.
Spending below the limit when it was not necessary.

Limits of this estimator

It assumes the amounts you enter are countable.
It does not apply state rules on specific exemptions.
It does not include spousal planning, annuities or trusts.
It does not account for the look-back or penalties.
It assumes care costs and income stay the same month to month.

Getting experienced help

How the spend-down is done can make a difference of tens of thousands of dollars. A Certified Medicaid Planner can identify exempt assets, plan purchases that meet real needs, protect the spouse at home and time the application. As a rough guide, published fees for full planning range from about $2,500 to $15,000 or more, help with an application from about $500 to $6,000, and hourly help from about $150 to $600.

Frequently asked questions

Can I give the excess to my children? Not without risking a penalty. See Gifts.

Can I prepay the nursing home? Prepaying care is generally allowed only within limits and must be for services actually received. See Can I prepay assisted living to spend down?.

Can I buy a new car? One vehicle is usually exempt, so replacing an old one at fair value is often allowed.

How fast must the spend-down happen? There is no deadline, but each month over the limit is a month Medicaid will not pay.

What if assets drop below the limit by accident? Nothing is lost for Medicaid purposes, but the applicant has less for personal needs. Apply as soon as assets reach the limit.

Does the spend-down apply to home care too? Yes. Waiver and other home care programs generally use asset limits as well, though the rules for income differ.

Last updated for 2026. General information only, not legal or financial advice. Medicaid Answers is a free educational resource published by Medicaid Answers Foundation.