Definitions for "Spend down"
The process by which an applicant for Medicaid benefits becomes or remains eligible by using up financial resources that are in excess of the limits set up by the Medicaid program.
Under the Medicaid program, a method by which an individual establishes Medicaid eligibility by reducing gross income through incurring medical expenses until net income (after medical expenses) meets Medicaid financial requirements. A resident spends down when he/she is no longer sufficiently covered by a third-party payer (usually Medicare) and has exhausted all personal assets. The resident then becomes eligible for Medicaid coverage.
A process by which individuals that would be eligible for Medicaid but for their income can use incurred medical expenses to meet the income limit. The monthly income limits for a program subtracted from an individuals gross income would give a “spend down” for a particular individual.