Four ways to spend down for MassHealth eligibility

On Behalf of | Apr 19, 2024 | MassHealth

If you’ve found your way to our blog, then you’re likely worried about covering your long-term care needs. That’s understandable, given the skyrocketing rates associated with nursing home and other forms of long-term care.

Figuring out the best way to cover those expenses can be confusing and frustrating. Don’t despair. You can find clarification on the avenues available to you so that you can develop the planning strategy that most effectively meets your needs.

One option at your disposal is to do what is known as spending down. To qualify for MassHealth/Medicaid, you have to meet certain income and asset limits. If your accumulated assets disqualify you, then you might consider spending down your wealth until you reach the threshold.

Using a spend-down strategy to qualify for MassHealth/Medicaid

To properly spend down your estate for MassHealth/Medicaid planning purposes, you can’t just go out and buy whatever you want. This is because certain assets are countable for eligibility purposes while others aren’t. So, you’ll have to be careful in how you spend your resources. Here are some expenditures that you can make that will reduce your countable assets while helping you retain your wealth:

  • Fixing up your home: Your primary residence is not counted for eligibility purposes so long as you specify an intent to return to the residence upon your release for long-term care. Alternatively, the residence will remain outside of the eligibility determination if your spouse or a some other dependent lives there. Therefore, since the residence is exempt from consideration, you can spenddown your other assets by fixing up your home. You might consider replacing the roof, taking care of plumbing and electrical issues, painting the home, or even remodeling certain portions of it.
  • Repairing your car: A similar analysis can be conducted on your vehicle since it’s also exempt from the eligibility determination to a certain extent. If you need a new transmission, new tires, or any other repairs, now may be the time to spend your resources on those repairs.
  • Paying off debt: You don’t want your debt to linger around for too long and result in foreclosure, repossession, or creditor legal action. Fortunately, you can use your spenddown strategy to take care of some of these debts so that they’re not accumulating late fees and additional interest while you’re in long-term care. Paying them off now will also save your loved ones from having to deal with them in the future.
  • Paying for funeral and burial expenses in advance: You might not want to think too much about your final arrangements, but there will be expenses tied to them that’ll have to be paid one way or another. If you use your assets to pay for them now, then you take care of those expenses ahead of time while also reducing your countable assets for MassHealth/Medicaid eligibility purposes.

Develop the sound MassHealth/Medicaid planning strategy you need

MassHealth/Medicaid planning is an intricate process that you have to carefully navigate. If you don’t, then you could make a mistake that jeopardizes your eligibility. To avoid such a disastrous outcome, you need thorough planning that aligns with the law. That might be stressful to contemplate, but you can seek out the guidance needed to confidently and competently navigate the process. Hopefully then you can rest easy knowing that your long-term care needs are protected while saving your wealth for your loved ones’ enjoyment.