Your Guide to Understanding Medicaid Spend-Down in New York State

Understanding how insurance works is difficult for the majority of the population. If you are a senior who is eligible for or who recently enrolled in Medicaid, you may have questions about what you are responsible for paying yourself. Medicaid Spend-Down is a term that is frequently talked about related to Medicaid. But what does it actually mean and how does it impact the coverage a senior receives? This article explains what Medicaid spend-down is, how it works, and what it covers.

Qualifying for Medicaid

For a senior to qualify to receive Medicaid, they must have assets that total less than $15,750 as an individual or $23,100 as a couple per year, have high health costs, and be over the age of 65. Assets counted for Medicaid eligibility include:

  • Checking Accounts
  • Savings Accounts
  • Retirement Accounts
  • Stocks
  • Bonds

A senior can meet the age requirements, have high health costs, have combined assets $15,750 or $23,100 as a couple, and still need Medicaid. This is where the Medicaid Spend-Down Program comes in.

Not everyone who has Medicaid can qualify for the spend-down program. People who do qualify must:

  • Be an Adult age 65 or older
  • Disabled or Blind
  • A Child Under 21

What is the Medicaid Spend-Down Program?

As the name indicates, the Medicaid Spend-Down Program in New York state helps subtract medical bills and expenses or spend them down to bring the person or couple within the Medicaid asset limit. The spend-down is the difference between the income earned from qualifying assets and the asset limit for Medicaid. The spend-down looks something like this example:

  • An individual senior’s assets are $500 more than the individual limit. If they have medical bills that are more than $500 each month, the amount after that $500 will be covered by Medicaid in New York.

The spend-down is similar to a deductible that insurance companies charge their plan members. Before the insurance company will cover the cost of the medical expenses incurred, the person covered by that insurance must pay the amount of the expense up to the deductible. After the limit is reached, the insurance will begin to cover the rest each month.

You are responsible for paying any bills up to the spend-down amount. Once the amount has been met, Medicaid will cover the rest.

What Expenses Qualify for Spend-Down in the Program?

There are a number of expenses that qualify for spend-down. Some of these include:

  • Personal Medical Bills
  • Medical Bills for a Spouse
  • Previous Medical Bills
  • Portions of Medical Expenses Not Covered by Medicare or Insurance
  • Some Medical Transportation Costs
  • Prescription Drug Costs
  • Medical Equipment and Supplies Payments (Walkers, hearing aids, surgical supplies etc…)
  • Medical Services (Therapies, care attendants, nurses, home health aides.)

How Does the Spend-Down Work?

In New York, there are two options for spending down excess income. One option is the Medical Bills Program. The second option is the Pay-In Program.

Under the Medical Bills Program, the covered individual pays their medical bills up to or over the spend-down amount that month. Medicaid will pay the rest of the expenses for that month. The qualifying bills can be submitted in person to the local Medicaid office, sent by mail, or by fax using the “Surplus Medical Bills” fax cover sheet.

The bills submitted do not have to be recent bills. Medicaid will pay past medical bills so long as the bill can have legal action brought against it to collect payment for it.

The Pay In Program gives the Medicaid recipient the option to pay the spend-down amount just like they would an insurance premium. The amount is paid for any month when Medicaid coverage is needed. Seniors who have reoccurring monthly medical expenses or services that exceed the spend-down amount may want this option. Payments can be made up to six months at a time.

Payments must be made to the Division of Accounts Receivable and Billing (DARB) by mail or by phone (debit cards only) at: 929-221-6054. Checks or money orders must be mailed to:


150 Greenwich Street, 34th Floor

New York, NY 10007

Time Limits for the Spend-Down Program

Once you are enrolled in the Medicaid spend-down Program, you are certified to use it for a period of 12 months. After the 12 months pass, you must recertify. A certification packet is sent to a senior if they’ve used the spend-down option at least once in the 12 months. Seniors who don’t use it will need to reapply.

The Medicaid spend-down Program exists to help seniors get Medicaid coverage. Seniors who have questions or need help determining what bills to submit for the spend-down Program should contact their local Medicaid office and counselor.

Xtreme Care is a New York State Licensed Home Care Service Agency (LHCSA) that offers personal care services through our trained Home Health Aides (HHA’s). Serving all 5 boroughs of New York City, we have over 22 years of experience providing seniors and loved ones with the care they deserve in the comforts of home. If you or a loved one would like to learn how we can help, visit our website at, or call us now at 718-461-9602 to speak with a home care specialist today!