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Florida Medicaid Spend-Down Options

Florida Medicaid Spend-Down Options
November 27, 2022

At Elder Needs Law, we have some interesting and complex Medicaid planning asset-protection strategies, but usually, the best—and most practical—strategy to start with is spending.  

Florida Medicaid allows a Medicaid applicant or their spouse to spend their own money on anything they need or want—even within five years of applying.

Of course, we don't encourage frivolous spending. Spending money now, of course, means it won't be available for future needs. However, it is worth considering in conjunction with other Medicaid-planning strategies. It's important to note that the Medicaid applicant cannot buy gifts for others.

Examples of Medicaid spend-down options include, but are not limited to, the following:

  • Paying off debts (credit cards, mortgages, medical bills, etc.)
  • Making home improvements to the exempt homestead property, which can include making the home more accessible for the Medicaid applicant (wheelchair ramp, walk-in-bathtub, wider doorways, hardwood flooring instead of carpet, guest suite for caretakers)
  • Making repairs to the homestead, such as replacing the roof, rewiring the home, upgrading the kitchen, and replacing the windows or old plumbing
  • Upgrading to a more comfortable car, or buying a vehicle that is wheelchair accessible or provides easier access for the Medicaid applicant 
  • Buying medical equipment like eyeglasses, motorized scooters, hearing aids, wheelchairs, a walk-in bathtub, and other devices
  • Buying personal property such as a recliner, computer, cell phone, television, or clothes
  • Treating yourself to a vacation, spa day, chiropractic care, or acupuncture.  

Take Care of Insurance/Funeral Needs

Purchasing term life insurance is something you should do before employing other Medicaid planning options. Life insurance with no cash value is not counted as an asset for Medicaid-eligibility purposes.

You might also consider buying an irrevocable life insurance burial policy or prepaid funeral plan. Someone is going to have to deal with the cost of the funeral, burial, or cremation at some point, so they might as well take care of it now.


Pre-Need Funeral Planning Vs. Prepaid Burial Life Insurance

Prepaid Funeral Plan

The prepaid funeral plan is just that—a funeral plan for which you have prepaid. You will typically receive a discount on the plan because you thought ahead and paid in advance. Both Dignity Memorial and Neptune Society offer popular pre-need funeral plans).

Pre-need funeral planning makes the most sense if you know the exact funeral home/cemetery where you plan to be buried. In that case, you should contact the facility directly. 

An important Medicaid consideration to note is that all pre-need funeral plans should be deemed "irrevocable." 


Irrevocable Pre-Need Life Insurance 

Irrevocable life insurance plans are better for those who want more flexibility, as they result in a lump-sum cash benefit paid out at your death to a named beneficiary. 

If the policy is for $15,000 and the funeral costs your family $5,000, then the beneficiary on the policy keeps the extra $10,000.

If you are interested in exploring term life insurance, whole life insurance, or an irrevocable life insurance burial policy from the convenience of your computer, contact us to schedule a 100% free consultation with one of our qualified elder insurance agents. Our firm understands the type of insurance and policy terms needed for an exempt Medicaid policy. 

Elder Needs Insurance Disclosure

Elder Needs Law Managing Partner Jason Neufeld holds his life and health insurance license and is a partner with Elder Needs Insurance. He may receive a commission from any policy purchase through Elder Needs Insurance.   

You are not obligated to shop or purchase any policy from Elder Needs Insurance. Jason will ensure you are buying Medicaid-compliant insurance policies while providing a convenient and easy way to learn more about possible Medicaid-compliant insurance solutions.

If you are a client of Elder Needs Law, PLLC:

Please note that the attorney-client privilege does not extend to communications related to any insurance product. There is absolutely no obligation to purchase any insurance product. Our goal is for you to be a more educated consumer and provide more holistic and comprehensive solutions to our clientele.

If you are NOT a client of Elder Needs Law, PLLC:

There is no obligation to consult with or purchase Medicaid planning, estate planning, probate, or any other elder law services through the law firm. 

By engaging a representative, agent, or affiliate of, you are not receiving legal advice or creating an attorney-client relationship. No attorney-client relationship exists until a written engagement agreement with Elder Needs Law, PLLC, has been signed.  

Jason Neufeld is the Founder and Managing Partner of Elder Needs Law, a Florida estate planning and elder law firm he created in 2017. With more than 15 years of experience practicing law, he represents clients in a wide range of legal matters, including Medicaid planning, estate planning, elder law, probate, Medicare, and life insurance.

Jason received his Juris Doctor from the University of Miami — School of Law and is a member of the Florida Bar and the Broward County Bar Association. He has received numerous accolades for his work, including being named a Rising Star and Super Lawyer by Super Lawyers and among the Florida Legal Elite by Florida Trend in 2024.

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