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This is from her personal needs allowance? Upgrades to her rollator or wheelchair or other assistive devices, hearing aids, eyeglasses, dental care, clothing, foot care, the hairdresser, other sundry expenses ...
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Medicaid as in paying for her care or for her Medical insurance. There is different criteria for both.

If for her care, not sure how she could have too much in her acct. Medicaid has a cap. If she is receiving Medicaid for her care she can't receive Aid and Attendance. Not sure about Medicaid for insurance. Sounds to me when she applied for either all of her income was not recorded.
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