Florida Medicaid Spend-Down: What Counts, What Is Exempt, and What You Can Do

• The homestead, up to $752,000 in equity (no limit if a spouse or dependent relative lives there), as long as the applicant intends to return.
• One vehicle of any value, and a second if it is over seven years old (with exceptions for luxury and antique vehicles).
• Personal belongings and household goods.
• An irrevocable prepaid funeral contract and a burial plot.
• Term life insurance, and whole life insurance with a total face value of $2,500 or less.
• Retirement accounts in payout status. In Florida an IRA, 401(k), or similar account that is paying out regular distributions is not counted as an asset; the distributions are income.
• Property that is essential to self-support, such as a working farm or business, within limits.
• Assets set aside for a community spouse up to the resource allowance of $162,660.

Bank accounts, CDs, brokerage and mutual fund accounts, savings bonds, cash-value life insurance above the threshold, a second home, vacant land, timeshares, boats and RVs, retirement accounts not in payout status, and the full value of jointly held accounts unless the other owner proves their share. A revocable living trust does not protect anything: assets in it are counted as if the applicant owned them outright.

Spending on the applicant or the applicant's spouse at fair value is never a transfer. Common, permitted uses:

• Pay for care. Private-pay months at the facility, home care, medical bills, and dental work.
• Pay debts. A mortgage, credit cards, a car loan, taxes.
• Fix the house. A new roof, air conditioning, accessibility work, repairs. The home is exempt, so money moved into it is protected.
• Buy exempt things. A reliable vehicle, an irrevocable prepaid funeral, hearing aids, a better bed, clothing.
• Pay our fee. Medicaid application and planning fees are a permitted spend-down expense.
• Pay a family caregiver under a personal services contract. Florida recognises a written, prospective contract that pays a family member fair value for care. Drafted properly by an attorney, it turns a gift into compensated work.
• Convert assets for a community spouse with a Medicaid-compliant annuity, which turns countable savings into an income stream for the spouse at home. This is legal work.

Each of these has conditions. The prepaid funeral must be irrevocable. The vehicle should be titled to the applicant or spouse. The caregiver contract must be in writing before the services are provided and the pay must be reasonable.

Do not give money to children "to get it out of the way." Do not add a child's name to the deed. Do not sell the house to a relative for a bargain price. Do not pay a family member for past care that was never agreed in writing. Do not buy an annuity from a salesperson who says it is "Medicaid safe" without an attorney reviewing it. Every one of these is a transfer or a countable asset, and every one appears in the bank statements.

Florida measures countable assets at a specific point each month, so the date the assets fall under the limit decides the first month Medicaid can pay. Spending down on the 28th rather than the 2nd of the following month can mean a full month of private pay, roughly $10,645. Part of a plan is choosing the month.