Ohio Medicaid Spend-Down: Prepaid Funerals, Home Equity, and Home Modifications

Spending Down to $2,000 Without Wasting Your Parent's Money

Ohio Medicaid requires countable assets of $2,000 or less for an individual applicant. If your parent has savings above that threshold, those assets must be spent before Medicaid will cover nursing facility or home care waiver services. The instinct is to panic — but a spend-down isn't about draining an account to zero. It's about converting countable assets into exempt resources that still benefit your parent.

Three of the most valuable spend-down strategies in Ohio are prepaid irrevocable funeral contracts, understanding the home equity exclusion, and investing in Medicaid-covered home modifications. Each converts countable dollars into something Medicaid won't penalize.

Prepaid Irrevocable Funeral Contracts

An irrevocable prepaid funeral plan can be an allowed spend-down method in Ohio. Before funding one, confirm with the county that the contract is genuinely irrevocable and that its funding structure qualifies; once funds are no longer accessible to the applicant, they may be treated differently from countable cash.

Do not assume that every pre-need plan qualifies or that there is no dollar limit. Confirm the applicable limit, contract structure, and irrevocable status with the county CDJFS and the funeral provider before signing.

Other burial-related exemptions may apply, but their limits and documentation depend on the program and the applicant's circumstances. Confirm them with the county CDJFS before moving funds. For a married couple, ask the county how each spouse's eligibility and spousal protections affect any burial planning.

The Home Equity Exclusion

The primary residence is exempt from Ohio Medicaid's asset count — but only up to a home equity interest cap of $752,000 (2026 figure). If your parent's home equity exceeds that limit, the excess counts as an asset that must be spent down.

The $752,000 cap does not apply at all if any of the following people live in the home:

• The applicant's spouse
• A child under age 21
• A blind or disabled child of any age

If none of these individuals live in the home, the applicant must document an "intent to return" to maintain the primary residence exemption. This is a written statement filed with the county Department of Job and Family Services as part of the Medicaid application. The intent to return is accepted even if the applicant is in a nursing facility and may never realistically go home — it's a legal declaration, not a medical prognosis.

One critical warning: the lifetime home-equity exemption and Ohio's Medicaid estate recovery program are separate issues. Before relying on the home exemption, ask the county or an Ohio elder-law professional how estate-recovery rules apply to your parent's circumstances.

Home Modifications Through PASSPORT

If your parent is returning home under the PASSPORT waiver or the Assisted Living Waiver rather than entering a nursing facility, Medicaid can fund home modifications that make the residence safe and accessible. Covered modifications under PASSPORT include:

• Wheelchair ramps and accessible entryways
• Grab bars in bathrooms and along hallways
• Walk-in shower conversions or roll-in shower installations
• Widened doorways for wheelchair access
• Stair lifts or platform lifts

These modifications are authorized through the care plan developed by the regional Area Agency on Aging. The modifications must be medically necessary (documented in the NFLOC assessment) and the AAA case manager must approve the scope and cost before work begins.

Home modifications can serve a dual purpose in the spend-down context: they convert countable assets into an improvement to the exempt primary residence and may make it possible for the parent to stay home rather than entering a nursing facility.

Timing the Spend-Down

The 60-month lookback period applies to gifts and transfers below fair market value, not to legitimate purchases. Paying full price for a funeral contract, making home modifications, or buying a car (one vehicle is exempt) are not penalized transfers — they're fair-value purchases of exempt items.

Where families get in trouble is making these purchases after the Medicaid application is filed without documenting them properly. Keep receipts, contracts, and proof of payment for everything. The county CDJFS will request documentation for every significant transaction during the lookback period.

Putting It All Together

The Hospital-to-Home in Ohio guide includes a Medicaid Spend-Down Calculator that walks through each exempt resource category, helps families identify which spend-down strategies apply to their specific situation, and tracks the documentation needed for a clean Medicaid application.

See more Ohio guides →