Means Test

Definition - What does Means Test mean?

A means test is an evaluation of a person's financial predicament for the purpose of deciding whether or not they will be eligible for financial assistance from the government.

Means tests are often used for government sponsored insurance programs like Medicare to determine whether a person qualifies for benefits.

Insuranceopedia explains Means Test

The main purpose of conducting a means test is to assess whether a person genuinely needs the assistance they are applying for. Generally speaking, to qualify for government assistance, a person must be in a distressed financial situation. So, wealthy people or people who have no accumulated wealth but very large incomes will typically not qualify for certain benefits.

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