Medicaid Spend-down

Medicaid Spend-down

Last updated: December 2009

How To Calculate Spend-down
Use of Bills to Meet Spend-down
Obtaining the Medical Card
  Temporary Card
Pay-In Spend-down
Using your Medical Card/Split bills
Spend-Down Fact Sheet

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How to Calculate Spend-Down

Persons who would qualify for Medicaid under AABD or TANF but for excess income and/or assets may still be eligible to receive medical assistance under the Spend-down program. DHS Policy Manual 15-08-00 et. seq. To get a medical card, the person needs bills or receipts for medical care, drugs, or supplies in an amount that HFS calls the spend-down amount. This spend-down amount works like an insurance deductible.

The spend-down period is one month for excess income. The spend-down period for excess assets under all spend-down programs is six months. HFS Policy Memorandum (5-26-89).

As an example, for a person with excess income, the spend-down amount is calculated by subtracting the monthly MANG level from monthly countable income (See MANG section): the remainder is the spend-down amount.


Persons who apply for and are given a spend-down amount are enrolled in the program for six months. At any time during the six months, if the person incurs bills equal to or in excess of the spend-down amount, she can qualify for medical coverage. At the end of six months, case will be reviewed to see if client has met spend-down in any one of the last three months. If spend-down has been met in any one of the three months, HFS will keep the case active. If not, a notice of termination will be sent to the client with a reapplication attached. Clients who believe this determination is erroneous should file an appeal as well as a new application in order to preserve appeal rights.

Use of Bills to Meet Spend-Down

There are several basic rules in the spend-down program:

  • All a person needs to do is incur the bill. The person does not need to pay the bill to use it to meet his spend-down amount. DHS Policy Manual 15-08-00 et. seq.
  • Bills must be dated within past six months to be applied to the monthly spend-down amount. If the bill is dated more than six months ago, the person need only have it reissued by the health care provider to use it for spend-down purposes. A charge may only be used once. The excess can be carried over indefinitely.
  • Paid bills and receipts are good for six months beyond the month in which bill is paid. The excess can be carried for six months.
  • A recipient can choose the month for which he or she receives the medical card. For example, if a person takes medical bills that met the spend-down to the Public Aid office on the 20th of the month, the person could decide to receive a medical card for the remainder of that month or for the entire following month
  • The following are examples of medical expenses that can be used to meet the spend-down amount:
    • Medicare and other medical insurance premiums;
    • Deductibles, co-insurance charges, or recipient co-payments;
    • Medical expenses for any services or items so long as they are recognized under state law but not covered under HFS’ MA program;
    • Drugs; and
    • Medical transportation expenses.


Obtaining the Medical Card

If a person enrolled in the spend-down program has medical bills or receipts equal to or in excess of his spend-down amount, he takes the bills and receipts to his local HFS office. The HFS caseworker has two days to determine if the person meets his spend-down amount and is qualified for medical assistance. If the person qualifies, the caseworker notifies HFS’ Springfield office. The medical card is then mailed to the recipient from Springfield. This procedure can take several days.

Temporary Card

If the person needs the medical card immediately, he or she should ask the local HFS office to issue a temporary medical card that is effective until he or she receives the regular medical card in the mail. The HFS office has two days to prepare the temporary medical card after the person is found qualified. DHS Policy Manual 02-01-00 et. seq. However, preparation of the card is not difficult and the office should be able to prepare the card quickly.

Pay-In Spend-down

The Pay-In Spend down program lets eligible Illinois residents pay their entire spend-down amount, or a portion thereof, to qualify for medicaid. They can pay this amount instead of having of having to send in receipts for the entire spend-down amount. They also have the option of sending in some medical receipts and then paying the difference to reach their spend-down amount.

The Pay-In spend-down program benefits include:

  • allowing an enrollees to pay ahead of time to receive a medicaid card at the beginning of the month;
  • letting an enrollees to choose for which months they get a medicaid card;
  • not requiring enrollees to keep track of bills and receipts, and then send them to their  case worker.

In general, Aid to the Aged, Blind and Disabled (AABD) community MANG clients qualify for the Pay-In Spend down program.

If you have any questions about whether you qualify, you should talk with the Illinois Department of Human Services ("IDHS"). See DHS Policy Manual 15-08-15: Pay-In spend-down, or call the IDHS Health Benefits Hotline: (800)-226-0768. 

Use of the Medical Card

The medical card usually will not provide for payment of bills used to meet the spend-down. However, HFS can "split" the bill and pay the remainder of the bill over the spend-down amount if the bill is submitted to HFS in the month in which the services were received. DHS Policy Manual 15-08-00 et. seq.

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