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Medicaid Qualification & Spend Down

Medicaid Qualification & Spend Down

How do I Qualify for Medicaid when I need to be in a Nursing Home?

Qualifying for Medicaid can be a daunting task. Our typical client’s Medicaid Application often exceed 1,000 pages. The amount of information requested from an applicant by Medicaid is voluminous.

If the Medicaid Applicant has property and/or money at the time he or she enters the nursing home, it would be most helpful to obtain professional legal assistance.


What Should I consider when thinking about having to pay the nursing home?

First, who is working for you and in your best interest should always be in your thought process.

  • The nursing home will offer to assist with the Medicaid application but remember that the Nursing Home works in their best interest and do not work for you. The Nursing Homes job is to get the nursing home paid and they are good at doing that.


Next, we recommend that you obtain a paid profession such as the attorneys at Vertical Estate Planning to work for you! At VEP we review all your documents, financial records, and assess needs of the client and the client’s family. We develop a Plan for your situation.

The first part of the Plan is to make certain that the client or Medicaid Applicant has care for life. If that life is 2 years or 20. This could involve care-at-home, assisted living and/or nursing home care later.


After a plan for care is established… VEP then looks at all available assets owned by the applicant to determine what assets the family will be able to keep.

If there is real estate, the real estate will need to be sold at fair market value. Fair market value must be established prior to the sale. Failure to do so could result in a significant penalty. In fact, any sales of real estate, vehicles or other assets will be examined for fair market value transactions.

All money will have to be spent down to below $2,000 prior to Medicaid eligibility. This can be done in ways the most beneficial to the applicant and the family. The Spend Down may involve purchasing funerals, burials, a computer and/or a vehicle. This may also include a gift that intentionally creates a penalty. This will be planned, and money set aside to cover the penalty period. If the client/applicant is married, the spouse can keep the house. A community spouse (Medicaid language for the spouse who stays at home) can also convert an asset, cash, to income in the form of an annuity. This is monthly income to the spouse for life.

Per the Medicaid Rules there are ways to creatively Spend Down the money and many times a gift to the family is possible with proper planning.

Medicaid qualification is complex & difficult. Be sure to contact the Attorneys at Vertical Estate Planning to work for you.

Do I Need Estate Planning?

The State of Alabama provides an estate plan for everyone. It is a one size, and it fits everyone. Fits everyone? Not really.

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417 4th Avenue SW #270 Cullman, AL

204 Main Street Suite 128 Trussville AL

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