Mastering Wisconsin Medicaid Spend Down Rules

2025 Asset Protection Guide

With nursing home costs in Wisconsin reaching $10,000 per month, savings can vanish fast. Wisconsin Medicaid spend down rules with up-to-date income limits, exempt assets and strategic planning insights to protect your assets.

Secure Your Future

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RefiTrust (headquartered at 1200 N Mayfair Rd, Wauwatosa, WI 53226) is staffed by qualified financial consultants with decades of wealth management experience. Our financial offerings are funded by the savings we pass through to our very satisfied roster of clients. To speak with an expert about your unique financial circumstances, please call 414-244-9444.

What Is Medicaid Spend Down in Wisconsin?

Medicaid spend down reduces income or assets to meet Wisconsin’s limits:

Excess can only be spent on approved expenses.

Understanding Exempt vs. Countable Assets

Knowing Medicaid income limits and what assets are exempt from Medicaid in Wisconsin helps you avoid unnecessary financial loss:

  • Exempt Assets: Primary residence (up to $750,000 equity), one vehicle, burial plots, personal belongings and prepaid irrevocable funeral trusts
  • Countable Assets: Cash, bank accounts, investments, retirement funds, secondary properties and cash value life insurance policies

5 Essential Wisconsin Medicaid Spend Down Rules

  1. Asset Limits Cap at $2,000 Wisconsin Medicaid limits countable assets to $2,000 ($3,000 for couples). The community spouse may retain exempt assets like the home, one car and prepaid funeral costs, according to the AOCA.
  2. Income Requires Specific Spend Down The monthly income limit for Medicaid in Wisconsin is $1,050.78, according to the ACOA. For example, a $2,500 income requires $1,449.22 in medical bills ($2,500 - $1,050.78) to qualify.
  3. Refi Trust Protects $15,000 instantly Refi Trust’s irrevocable funeral trusts shield $15,000 per person with no look-back period. Unlike bank trusts capped at $4,250, RefiTrust's insurance-backed IFTs are ideal for Medicaid planning for elderly parents in Wisconsin.
  4. 5-Year Lookback Hits Transfers Wisconsin reviews financial activity for five years. Gifting money or property during this period can trigger penalties of $9,599.80 per month of transferred value (ACOA).
  5. Estate Recovery Targets Assets Post-death, Wisconsin may claim probate assets or your home unless delayed by a spouse, minor or disabled child. Families looking to preserve inheritance through Medicaid planning in Wisconsin need to act early.

Wisconsin Spousal Impoverishment Protections

Medicaid planning for couples in Wisconsin helps the community spouse remain financially stable:

  • Monthly Allowance: $2,643.75–$3,948.00 (Medicaid.gov)
  • Resource Limit: Up to $157,920 (Medicaid.gov)
  • Exemptions: Home, personal goods and one vehicle
  • Advanced Planning Strategies: Convert excess income, protect home equity and offer financial stability for the community spouse

Without a plan, the well spouse may be left with little financial flexibility. Refi Trust helps protect income and resources while securing Medicaid eligibility for the other spouse.

Qualifying Spend Down Expenses in Wisconsin

Wisconsin allows excess income or assets to be spent on approved medical and care-related costs such as:

  • Nursing home fees ($9,125–$12,000/month) (DHS)
  • Medical equipment
  • Prescription drugs
  • Doctor bills
  • Insurance premiums

Gifts and non-medical transfers do not qualify under Medicaid rules.

How to Protect Assets in Wisconsin

Irrevocable Funeral Trusts

Protect $15,000 per person immediately. Up to $100,000 can be protected if established 5+ years in advance. Funeral trusts remain fully exempt and help protect retirement savings from Medicaid in Wisconsin.

Convert Life Insurance

Cash value life insurance Medicaid planning in Wisconsin involves converting policies to irrevocable funeral trusts. This protects the cash value from spend-down and estate recovery (AOCA).

Spend Wisely

Use excess assets on exempt items like home upgrades, medical equipment or funeral services.

Trust Type Matters

Only irrevocable trusts remove assets from Medicaid calculations. Revocable trusts offer no protection.

Secure Your Future

Why Choose Refi Trust for Wisconsin Medicaid Spend Down Planning?

Refi Trust specializes in helping families throughout Wisconsin navigate complex Medicaid rules with confidence:

Don’t wait. Contact us today to protect your retirement, qualify for care and preserve your family’s legacy from Medicaid spend down rules. We offer nationwide services with Wisconsin-specific expertise, drawing clients from Milwaukee, Racine, Kenosha, Waukesha, Ozaukee, Washington County and beyond.