  We present a protocol that produces a conditionally prepared state that can
be used for a Bell test based on homodyne detection. Based on the results of
Munro [PRA 1999], the state is near-optimal for Bell-inequality violations
based on quadrature-phase homodyne measurements that use correlated
photon-number states. The scheme utilizes the Gaussian entanglement
distillation protocol of Eisert et. al. [Annals of Phys. 2004] and uses only
beam splitters and photodetection to conditionally prepare a non-Gaussian state
from a source of two-mode squeezed states with low squeezing parameter,
permitting a loophole-free test of Bell inequalities.
