Income too high for Medicaid? Spenddown!

Medicaid is a health insurance program for New Yorkers who cannot afford to pay for their own medical care.  Because Medicaid is a program for the poor, people must have income and assets below a certain limit to be eligible for coverage.  Under the Affordable Care Act, many more New Yorkers will qualify for Medicaid based on their incomes with the new Medicaid Expansion.  However, those New Yorkers who are over 65, disabled, or blind do not fit into the expansion categories and have a different income limit.

For the year 2014, a single person who is disabled, over the age of 65 or blind must have an income under $809 a month and have assets of less than $14,550 to qualify for Medicaid. A household of two people can have a monthly income of less than $1,192 and resources that are worth less than $21,550 to qualify.  You can request an application for Medicaid by phone, by mail or in person through your local department of social services and your eligibility will be determined then.

** NOTE: You DO NOT have to figure out if you have excess income or the amount- your Medicaid caseworker will make this determination. You need to contact or visit your local Department of Social Services to tell them that you want to be in the Excess Income Program and if your Medicaid case is opened with excess income, you will get a notice telling you the amount of your excess income. **

Here is the contact information for local Social Services Departments:

  • Cattaraugus County DSS, Cattaraugus County Building, 1701 Lincoln Avenue Suite 6010, Olean, New York 14760-1158, (716) 373-8065
  • Chautauqua County DSS, Hall R. Clothier Building, Mayville, New York 14757, (716) 753-4421
  • Erie County DSS, 95 Franklin Street, Buffalo, New York 14202-3959, (716) 858-8000
  • Niagara County DSS, 20 East Avenue, PO Box 506, Lockport, New York 14095-0506, (716) 439-7600
  • Allegany County DSS, 7 Court St., Belmont, New York 14813-1077, (585) 268-9622
  • Genesee County DSS, 5130 East Main Street, Suite #3, Batavia, New York 14020, (585) 344-2580


Many older or disabled people are living month to month, paying bills with very little left to live on.  A lot of these people find that, although they barely making enough to get by, their monthly incomes are still too high to get Medicaid.  Fortunately, there are ways to still receive Medicaid even if your income or resources are over the financial limit.  One of those ways is to utilize a “Spend-Down,” also known as the Medicaid Excess Income Program. People who can apply to use this “Spend Down” are:

  • people under age 21
  • people age 65 or older
  • people who are certified blind or certified disabled
  • pregnant
  • the parents of a child under age 21.

The amount of someone’s income that is over the Medicaid level is called excess income. With Medicaid, it can work like a deductible. If you can show that you have medical bills equal to your excess income in any particular month, Medicaid will pay your additional medical bills beyond that amount for the rest of that month.

You can spend down to the Medicaid level in one of two ways:

  • Outpatient Care and Services (One Month Eligibility)
    • If you need outpatient care in a hospital, clinic or doctor’s office, prescription drugs or medical supplies, lab tests, or home care in the community you must:
      • Personally deliver, send or fax your medical bills to your local department of social services when they are at least equal to your excess income amount.
      • These bills can be paid or unpaid. You will need to do this each month you need outpatient care. ANY MONTH YOU DO NOT DO THIS- YOU WILL NOT HAVE MEDICAID THAT MONTH
  • Inpatient/Hospital Care and Services (Six Months Eligibility)
    • If you need hospital care or need help paying your hospital bills you must:
      •  Have medical bills that are at least equal to your monthly excess income amount for six months. These bills can be paid or unpaid. They can also be for medical services other than hospital care.
      • Once your medical bills are at least equal to your excess income amount for six months, you must bring or send these bills to your local department of social services. You will then receive Medicaid for six months.

For example:

Carol’s monthly income is $1000.00

The Medicaid threshold level of income is $809.00

–  $809
$ 191

Carol must show she has Medical bills of at least $191 in that month to receive Medicaid and get the rest of her medical care covered.

  • Using Medical Bills
    • When you first enroll in the Excess Income program, you may submit past medical bills to be counted toward your excess income amount for the current month and additional months. Once you use a bill to meet your excess income for a particular month, you cannot use it again.
    • Past paid medical bills may be used if the medical services were provided and paid for within the three calendar months before the month you applied for Medicaid.
    •  These bills can be applied meet your excess income for up to six months beginning in the month you applied.
    • Past unpaid medical bills can be used to meet your excess income amount no matter how old they are.  They must be still viable, which means that the medical provider is still able to bring a legal action to collect them.
      • These bills may be applied to meet your excess income indefinitely into the future.
  • What Medical Bills Can I Use?
      • Doctor, dental and clinic visits, eye exams, lab tests, and prescription drugs. 
      • Transportation to and from medical appointments 
      • Therapists, nurses, personal care aides (home attendants) and home health aides, as ordered by a doctor. Providers must be approved by Medicaid.
      • Co-payments and deductibles for medical insurance, including Medicaid, and Medicare
      • Surgical and medical supplies, medical equipment, prosthetic devices, hearing aids, eyeglasses, and over-the-counter drugs if your doctor has ordered them.
      • Bills paid by the Elderly Pharmaceutical Insurance Program (EPIC) or the AIDS Drug Assistance Program (ADAP) if within 3 months application to Medicaid
      • Chiropractor services (and other medical services not covered by Medicaid);
      • Medicare or private insurance – ONLY the part of the bill that Medicare or private insurance does not pay.

*NOTE:  Bills may be for medical care given to you, your spouse, or your children who are under 21 years old. If you provide medical support for a child not living with you, you may be able to use the child’s bills.

What if I don’t have enough medical bills?  The Pay-In Program

  • If you do not have medical bills but you need medical care, there is another option called the Pay-In Program:
  • You can pay your monthly excess income amount for any month to your local department of social services. You should only do this if you need services in that month. Ask your local department of social services about this option.


Using the Excess Income/Spend-Down program is just one way to obtain Medicaid coverage when your income to too high for eligibility.  Stay tuned for the next chapter…


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