Asset Spend-Down and Medicaid Enrollment in Nursing Homes.

Importance: Medicaid eligibility for nursing home care is determined in part by an individual's (or a couples', if married) financial resources, including income and assets. To qualify, individuals must "spend down" their resources to meet states' Medicaid eligibility asset thresholds. Little empirical work has examined the rate of Medicaid spend-down in nursing homes over the past 2 decades. Objective: To identify the rate of spend-down in nursing homes, defined as the share of total residents who began their stay as non-Medicaid enrolled (after accounting for Medicare-covered skilled nursing facility [SNF] days, where applicable) and became Medicaid enrolled before discharge or death. Design, Setting, and Participants: This cohort study used a combination of administrative, enrollment, and claims data from 2018 to 2022 to build a panel of 191 416 US nursing home residents enrolled in traditional Medicare-including those admitted for postacute and long-term care-who newly entered a facility in 2018 and either stayed beyond their Medicare SNF days or did not have any Medicare-covered SNF days. Statistical analysis was performed from July 2024 to October 2025. Exposure: Newly entering a nursing home in 2018 as non-Medicaid enrolled. Main Outcomes and Measures: The main outcome was whether an individual spent down their assets and became enrolled in Medicaid during their nursing home stay. Multivariate regression was used to identify factors associated with spend-down. Results: The study included 191 416 individuals (mean [SD] age at time of admission, 81.0 [11.4] years; 58.0% women; mean [SD] time in nursing home, 331.0 [485.8] days) with traditional Medicare who newly entered a nursing home in 2018, of whom 33.9% either began their stay as Medicaid enrolled or enrolled in Medicaid after the completion of their Medicare-covered SNF days. The remaining 66.2% of individuals were initially not enrolled in Medicaid on admission or after the completion of their Medicare-covered SNF days. Of those who were initially not Medicaid enrolled, 16.4% spent down their assets during their stay and enrolled in Medicaid (mean [SD] time to spend-down, 6.1 [7.9] months). The likelihood of spend-down increased with length of stay and was higher among Black, Hispanic, North American Native, and younger residents. Conclusions and Relevance: In this cohort study of nursing home residents, those who entered a nursing home as initially non-Medicaid enrolled, especially those with longer stays, were at risk of spending down their assets and enrolling in Medicaid. This finding raises concerns both about individuals impoverishing themselves because of the high cost of care and the long-term financial sustainability of the Medicaid program.