New Medi-Cal Rules...What You Don't Know Will Hurt You

There is a lot of buzz about the recent changes that took effect on July 1st of this year. Many feel they were long overdue since these regulations had not been updated since 1989.

Last year, Medi-Cal officials provided the new regulations to the public, and we reviewed them and performed our due diligence. As a result, I offer the following:

Asset Limit Changes:

• The current asset limit for a single individual is now $130,000.
• The current asset limit for a couple is $195,000.
• For each additional family member, you can add an additional $65,000.
• Even more interesting is the fact that California is expected to drop the asset limit altogether on January 1, 2024.

What Did Not Change:

Transfers

In many cases, potential applicants will retitle assets thinking they can qualify without the assets in their name. When done properly and within Medi-Cal regulations, this can be done without a Period of Ineligibility, or POI. If done incorrectly, a POI can be assessed, and they must wait up to 30 months to begin receiving benefits. The transfer penalty does not apply when the person is not in a skilled nursing home, but they should seek counsel from a Medi-Cal expert to consider how and when transfers are made, in the event they enter a skilled nursing home down the road. That is because they are still subject to the lookback period.

Exemptions

The rules for exempt and nonexempt assets will also remain the same.

Income Test

California has no income limits for most programs.

Medi-Cal Estate Recovery

These rules did not change. California’s Medi-Cal system has the right to be reimbursed for most services provided. This is completely avoidable with proper planning!

California's Money Grab - Don't Be Fooled!

Although it is now easier to get qualified for benefits, people need to understand about Medi-Cal Estate Recovery. The state is entitled to reimbursement for the payments they made during the Medi-Cal recipient’s lifetime and can put a lien on any assets not protected. So, as an example: A person dies with $50,000 in the bank because they can have up to $130,000, but that $50,000 is subject to Estate Recovery, so the state will now get a larger payback since the old figure was only $2,000.

Why Is This A Big Deal? Consider the Facts:

• A person does not repay the federal government for all the Social Security benefits paid during their retirement. Why? Because you gave them the money first.
• Same with Medicare benefits – since 1966, the federal government has been deducting these payments from our paychecks and a part of these funds go to every state under Medicaid, which is called Medi-Cal in California. In addition, California collects taxes to support the Medi-Cal programs, but again, we give them the money first.
• When a Medi-Cal recipient dies with an estate subject to probate, in most cases, the state of California will seek reimbursement from the remaining estate. The only deduction to that balance in most cases is the cost of funeral expenses, so if your assets are more than your funeral costs, those remaining funds are susceptible to recovery.

My Advice:

Hire an expert to develop a strategy to protect all that you have worked so hard for! Better yet, call us for a no-cost consultation at (559) 227-7322, or contact us by email.