Medicaid Spend-down 101
In the U.S., we have various programs to help with health care costs: Original Medicare (your red, white and blue card), a federally funded program for eligible individuals over 65 and adults 18+ with chronic disabilities or dialysis patients; and Medicaid, a joint federal and state assistance program for people with limited income and resources.
Not everyone is eligible for Medicaid.
Because Medicaid is designed for low-income families, income limits apply. Income limits are set by the federal government as a percentage of the federal poverty level (FPL). But states can set their own limits and decide whether to cover other services. Family size, resources and services received also factor into the formula.
Some people have too much income to qualify for Medicaid. This amount is called excess income. In order to be able to qualify, these people can ‘spend-down’ the extra income on medical bills. For example, suppose Clara is denied Medicaid because her monthly income is $100 more than the limit for Medicaid eligibility. In that case, she can get covered by Medicaid if the $100 excess is spent on medical bills. The ‘spend-down’, in this case, is the $100 of medical bills she incurs.
New York State Updates Medically Needy Income Level (MNIL)
As of January 1, 2023, the New York State Department of Health has increased the Medically Needy Income Level (MNIL) to 138% of the Federal Poverty Level (FPL). That means, if your income is up to $1,563 for an individual and $2,106 for a couple, you now qualify for Medicaid. And if you are currently spending down to get Medicaid, you could lower or even eliminate your monthly surplus/spend-down entirely.
If you have a Medicaid surplus/spend-down, you should have received a letter from NYC Human Resource Administration (HRA) or Local Department of Social Services (LDSS) about this change. The letter would have suggested that you request an income/budget review.
This review is not mandatory and will occur automatically at the time of your next Medicaid renewal. However, if you are eligible now, you can start saving money right away. So don’t wait to request a review of your income/budget from HRA/LDSS.
Elderplan believes that everyone should have access to high-quality health care, regardless of their income level and we are committed to working with our members and HRA/LDSS to ensure they have access to the care they need, when they need it.