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Medicaid Spend Down in New York: 2026 Excess Income Program Guide

By Modinul Islam Khan Updated November 10, 2026

Reviewed November 10, 2026. Medicaid spend down in New York (officially the Excess Income Program, also called “spenddown” or “surplus income”) lets people who are 65 or older, certified blind, or certified disabled get Medicaid even when their income is above the limit. In 2026, the non-MAGI Medicaid income level is $1,836 a month for one person and $2,489 for a couple. Any countable income above that level becomes your monthly “excess income,” which you meet with medical bills or a payment to your local Department of Social Services (DSS), much like a deductible.

New York’s program follows the same basic idea as spend-down programs in other states. For the national picture, see our Medicaid spend-down guide. For other New York topics, visit our New York Medicaid hub.

Quick answer:

Who can use it: non-MAGI applicants (age 65+, blind, or disabled), plus certain children under 21, pregnant people, and parents of children under 21. Most adults 19 to 64 in the MAGI group cannot use spenddown.
2026 income level: $1,836/month (1 person) and $2,489/month (2 people), effective January 1, 2026.
2026 resource level: $33,038 (1 person) and $44,796 (2 people).
How to meet it: submit paid or unpaid medical bills, pay the excess amount to your DSS (the “Pay-In” program), or, if you are disabled, deposit the excess into a pooled supplemental needs trust.
Coverage periods: one month at a time for outpatient care, or six months at a time (which includes hospital care).

What the NY Medicaid Excess Income Program is

The New York State Department of Health (DOH) describes the Excess Income Program as a way to be covered when you are eligible for Medicaid in every way except that your income is above the Medicaid level. Your caseworker sets a monthly excess income amount: your countable income minus the Medicaid income level. Once your medical bills reach that amount, Medicaid can cover the rest of your care for that period.

The rule behind it is in state regulation 18 NYCRR 360-4.8, which lets a person become eligible by incurring medical expenses equal to their excess income, or by paying that amount to the social services district.

MAGI vs. non-MAGI: who has a spenddown

New York sorts Medicaid applicants into two budgeting groups:

MAGI: adults 19 to 64 who are not eligible for Medicare, children, pregnant people, and parents or caretaker relatives. These people apply through NY State of Health. There is no asset test, and adults under 65 without a disability or a child under 21 at home cannot use spenddown. If their income is too high, they may be referred to the Essential Plan or a subsidized Qualified Health Plan instead.
Non-MAGI (aged, blind, disabled): people 65 and older, people who are certified blind or disabled, and most people on Medicare. This group has a resource test, and this is the group that can use the Excess Income Program.

2026 NY Medicaid income and resource levels (aged, blind, disabled)

New York’s levels usually change on January 1. The figures below are the 2026 levels from DOH’s GIS 26 MA/05 attachment, effective January 1, 2026. As of this review, DOH has not published 2027 levels.

2026 non-MAGI level	1 person	2 people
Monthly income level (138% FPL)	$1,836	$2,489
Annual income level	$22,025	$29,864
Resource (asset) level	$33,038	$44,796

Medicaid also subtracts a $20 general income disregard from gross monthly income. Your home, a car, and personal property generally do not count as resources. Cash, bank balances, CDs, stocks, bonds, IRAs not in distribution, and the cash value of life insurance generally do count.

How excess income is calculated: an illustrative example

The example below is illustrative only. Your DSS will apply the deductions that fit your case. Under 18 NYCRR 360-4.8, health insurance premiums (including Medicare premiums) are among the costs subtracted first.

Suppose a single 70-year-old in Albany receives $2,300 a month in Social Security and pays the 2026 standard Medicare Part B premium of $202.90.

Gross monthly income	$2,300.00
Minus $20 income disregard	-$20.00
Minus Medicare Part B premium (2026)	-$202.90
Countable income	$2,077.10
Minus 2026 income level (1 person)	-$1,836.00
Monthly excess income (spenddown)	$241.10

In this example, the person would need $241.10 in medical bills (or a $241.10 pay-in) for each month of outpatient coverage. For six months of coverage, they would need bills totaling six times that amount, or $1,446.60.

How to meet your spend down in NY

One-month (outpatient) coverage

Bring or send your DSS medical bills equal to or greater than your monthly excess income. You do this for each month you need care such as doctor visits or prescriptions. The bills can be paid or unpaid.

Six-month coverage (includes hospital care)

If you submit bills that equal your monthly excess income for six months, you get six months of full coverage, including inpatient care. The bills do not have to be hospital bills.

Pay-in spenddown

If you do not have enough bills, you can pay your excess income amount directly to your DSS (HRA in New York City) for any month you need care. The NY State Office for the Aging’s 2026 HIICAP guide notes that you can pay in for up to six months at a time. Under 18 NYCRR 360-4.8, any unused pay-in money is refunded or credited to your account. If you have no bills and do not pay in, you have no Medicaid coverage that month.

Which bills count

Doctor, dental, clinic, lab, eye exam, and prescription bills
Medicare and other insurance premiums, deductibles, and copays, including Part D
Doctor-ordered home health aides, nurses, and therapists
Medical supplies, equipment, hearing aids, eyeglasses, and doctor-ordered over-the-counter drugs
Transportation to medical appointments (usually with a receipt)
Services Medicaid does not cover, such as chiropractic care
Bills for your spouse or children under 21, in some cases

Only the part of a bill that Medicare or other insurance did not pay counts. New applicants can also use paid bills from the three months before the application month and unpaid bills that a provider can still legally collect. EPIC and ADAP payments made in the three months before you apply can count at the full amount paid. Once your spenddown is met, Medicaid pays only providers enrolled in New York Medicaid.

Pooled supplemental needs trusts in NY Medicaid

People with a disability have another option. According to the 2026 HIICAP guide from the NY State Office for the Aging, a disabled person of any age can deposit their monthly excess income into an approved pooled supplemental needs trust, and the district disregards that amount. This can eliminate the spenddown, and the trust pays bills such as rent on the person’s behalf.

Key points from DOH guidance (GIS 08 MA/020):

The trust holds funds for a certified disabled individual and is run by a nonprofit association that keeps a separate account for each beneficiary.
Principal and income in a pooled trust account are not counted for Medicaid eligibility.
For people 65 and older, deposits can be treated as transfers if the person later applies for nursing home Medicaid. There is no penalty for the amounts the trust spent on the person’s needs, but the person must keep proof of those payments.

Pooled trusts have many rules. Ask your DSS, or a legal services program, before you sign a joinder agreement.

Medicare Savings Programs in New York (2026)

If you have Medicare, check the Medicare Savings Programs (MSP) too. MSP is a separate program. It helps pay Medicare costs, while full Medicaid (including spenddown) pays for medical care. DOH’s 2026 MSP limits, which include the $20 disregard, are:

2026 program	1 person (monthly)	2 people (monthly)	What it pays
QMB (Qualified Medicare Beneficiary)	$1,856	$2,509	Part A and/or Part B premiums, plus Part A and B deductibles and coinsurance
QI (Qualifying Individual)	$2,494	$3,375	Part B premium only

DOH’s 2026 MSP page lists a resource limit only for full Medicaid ($33,038 single, $44,796 couple), not for QMB or QI. The QI limit is much higher than the full Medicaid income level, so a person who has a spenddown for full Medicaid may still qualify for QI help with the Part B premium. Ask your DSS to screen you for both.

A note on nursing homes and long-term care

Nursing home Medicaid uses different budgeting. A resident generally keeps a personal needs allowance (currently $50 a month, per the NY State Long-Term Care Ombudsman Program), and most remaining income goes to the nursing home as the resident’s monthly contribution, often called the NAMI. For a married applicant, the 2026 community spouse can keep resources of at least $74,820 (or the spousal share, up to $162,660), with a monthly income standard of $4,066.50. Nursing home applications also have a five-year (60-month) lookback for asset transfers.

A 2020 state law called for a 30-month lookback for community-based long-term care, but the DOH waiver page describes it as a proposal, and we could not confirm on an official page that it has been put into effect. Ask your DSS how it applies to you. Learn more in our guides to Medicaid nursing home care and nursing home costs.

How to apply for NY Medicaid with a spenddown

DOH says people in the Excess Income Program work with their Local Department of Social Services, not NY State of Health. In New York City, that is the Human Resources Administration (HRA).

Outside NYC: contact your county DSS office.
NYC: call HRA at (718) 557-1399, or the HRA Medicaid line at 888-692-6116. People 65+ or on Medicare can also apply online through ACCESS HRA.
NY Medicaid Helpline: 1-800-541-2831.
NY State of Health (MAGI applicants): 1-855-355-5777 (TTY 1-800-662-1220).

Bring proof of income, resources, and any medical bills you want counted. Not sure which group you fall in? Try our Medicaid eligibility tool. Once approved, keep up with renewals so your coverage does not lapse. Our Medicaid renewal guide explains the process.

Medicare365 is not affiliated with any government agency. Confirm your situation with your DSS.

Frequently asked questions

What is the Medicaid spend down limit in New York for 2026?

For aged, blind, and disabled applicants, the 2026 income level is $1,836 a month for one person and $2,489 for two. Countable income above that is your monthly spenddown. The 2026 resource level is $33,038 for one person and $44,796 for two.

Can adults under 65 use the NY Medicaid excess income program?

Only in some cases. Adults under 65 can use it if they are certified blind or disabled, pregnant, or a parent of a child under 21. Other adults 19 to 64 are budgeted under MAGI rules and cannot spend down.

Do medical bills have to be paid to count toward my spenddown?

No. DOH says both paid and unpaid bills can count. Paid bills from the three months before you apply can count, and unpaid bills count as long as the provider can still collect them.

What is pay-in spenddown in NY?

It means paying your monthly excess income amount to your DSS (HRA in NYC) instead of submitting bills. You get Medicaid for the months you pay for, and unused amounts are refunded or credited.

Will the spenddown amount change in 2027?

Possibly. New York usually updates its levels on January 1, and a Social Security cost-of-living increase can also raise your excess income. As of November 10, 2026, DOH had not published 2027 levels.