How to Spend Down Income or Assets to Qualify for Medicaid in Michigan?
Many Michigan families find themselves earning or owning just a little too much to qualify for Medicaid. When this happens, they are often told to do a “spend down.” The term can sound confusing, but it simply means using or adjusting resources until you meet the state’s financial limits.
If you are trying to qualify for the Michigan Home Help Program, understanding how a spend down works can help you plan carefully. Care Plan Inc. helps Michigan caregivers understand these steps so they can qualify and get paid for providing care once approved by the Michigan Department of Health and Human Services (MDHHS).
What Spend Down Means
A spend down is the process of lowering your income or assets to meet the Medicaid limits. Medicaid has both income and asset rules, and each case is reviewed individually by MDHHS.
For example, a single person who earns slightly above the monthly limit or who owns more than the allowed amount in savings may still qualify after spending some of that money on approved expenses.
The goal is not to lose money. It is to make sure that income and assets are used for legitimate needs before Medicaid coverage begins.
What Counts Toward Income and Assets
Income includes Social Security, pensions, retirement withdrawals, and any regular payments received.
Assets include
Cash and savings accounts
Certificates of deposit or stocks
Additional vehicles beyond one primary car
Property that is not your main home
MDHHS does not count your main home, one vehicle, or household items such as furniture and clothing.
How to Spend Down Correctly
Spending down does not mean giving away money. It means using your own funds for approved needs.
Here are some common and acceptable ways to spend down:
Pay for medical bills, prescriptions, and health insurance premiums.
Purchase or repair essential household items such as appliances or furniture.
Pay off outstanding debts, including credit cards or utilities.
Make necessary home repairs to improve safety or accessibility.
Prepay for funeral or burial arrangements within state guidelines.
Families who follow these guidelines often qualify for Medicaid without facing penalties.
Learn more about income requirements in Michigan Medicaid Income 2025
Mistakes That Can Cause Penalties
If you give away money or property to someone else to reduce your assets, MDHHS may apply a penalty or delay your eligibility. This includes transferring funds to family members or selling items for less than they are worth.
To stay compliant, keep detailed records of every transaction, including receipts and proof of payment. You can use Care Plan Inc.’s Forms page to stay organized.
What Happens After You Qualify
Once your income and assets meet Medicaid limits, MDHHS reviews your medical need. If you require help with daily activities such as bathing, dressing, or meal preparation, you may qualify for the Michigan Home Help Program.
The Home Help Program lets family members or friends get paid for providing care to an approved participant. MDHHS decides how many hours of care are approved based on the Medical Needs Form (DHS-54A). Care Plan Inc. pays caregivers $17 or more per hour weekly once the state approves care hours.
To learn how to apply, read How to Apply for the Home Help Program
Real-Life Example
A retiree in Flint had a modest pension and savings that were slightly above Medicaid limits. He paid off small debts, fixed the roof on his home, and replaced an old refrigerator. Once his balance fell below the limit, he qualified for Medicaid and joined the Home Help Program. His daughter now provides his daily care and is paid weekly through Care Plan Inc.
This shows how careful planning can help families qualify without losing control of their finances.
How Care Plan Inc. Helps Families
Care Plan Inc. does not make eligibility decisions, but we help caregivers understand how the Michigan Home Help Program works once Medicaid is approved.
Our agency assists with enrollment, forms, and education about maintaining compliance. Once MDHHS approves care hours, we pay caregivers seventeen dollars or more per hour weekly.
Read Maintaining Eligibility for the Home Help Program and Tips for Family Caregivers – https://www.michiganhomehelp.org/blog/tips-family-caregivers
Common Questions About Spend Down
Can I give my savings to my child to qualify?
No. Transferring money or property to someone else may result in a penalty period. It is better to use funds for medical or personal needs instead.
Does spending down affect my house?
No. Your primary home does not count toward Medicaid limits. However, other properties such as vacation homes do count as assets.
How do I know if I have spent down enough?
MDHHS will review your records and notify you when your assets meet the required limit.
Can I reapply for Medicaid if I was denied?
Yes. If your income or assets change, you can reapply at any time.
Care Plan Inc. helps Michigan caregivers get paid through the state’s Home Help Program. We educate families about eligibility and how to stay compliant once approved. The state decides how many hours are approved, and Care Plan Inc. pays caregivers $17 or more per hour each week for the care they provide.
Check your eligibility or enter your information on our Contact page for inquiries.