Medicaid Spenddown in Nursing Homes

Abstract

This paper employs information from nationally representative surveys to examine the incidence and causes of Medicaid spenddown among disabled elderly persons. About 10% of nursing home discharges experience "asset spenddown," the process of converting from private pay to Medicaid. In contrast, over 50% of nursing home patients remain private pay throughout their stays. In addition, becoming a Medicaid patient is more common among community residents than among nursing home residents. Implications of findings for health care policies are discussed.