More than half of all Americans who turn 65 in the next 20 years will need some kind of long-term care at least once in their lives.
Long-term care can be expensive and isn't covered under most private health insurance policies. Does your estate plan include provisions for planning for the costs of nursing home care?
Whether you're thinking for yourself, your parents, or another family member -- Medi-Cal planning could protect your assets and save your family a lot of grief.
In fact, Medi-Cal is the only government program that will cover the cost of long-term care at a nursing home. Medicare only provides very limited benefits.
Planning your future with Medi-Cal in mind helps you get the benefits you need while protecting your financial assets. You don't have to go broke to get nursing home care.
Medi-Cal planning could help you:
- Lower or eliminate your nursing home bills
- Protect your savings and your financial future
- Keep your home and other assets
- Pass on an inheritance to your children
If you or your loved one live in California, you need to consider Medi-Cal as part of your Life Care Planning. The earlier you plan, the better -- but you can still qualify for Medi-Cal even if you're currently paying out-of-pocket for nursing home care.
Elder law lawyer Richard Seff has devoted his practice to helping elders through his innovative Life Care Planning service which includes Medi-Cal planning. Call our Woodland Hills office at 818-292-8160 or Beverly Hills office at 310-230-5686. Or send us a message via our "Get Help Now" box in the left column.
What Services Does Medi-Cal Cover?
In California, the average monthly cost of nursing home care is $9,500! That's well over $100,000 a year.
That means a severe stroke, dementia, Alzheimer's or other disabling condition could wipe out everything you've spent a lifetime earning.
Medi-Cal is California's version of the federal Medicaid program. It helps families in California cover the cost of around-the-clock skilled nursing care and other "intermediate care" services at skilled nursing facilities, sub-acute facilities, or rehabilitation centers.
If you qualify, Medi-Cal will pay 100% of the cost of your nursing home care.
Medi-Cal Share of Cost
Under Medi-Cal, some people may have to pay a "share of cost."
For an unmarried applicant, their social security and other income (pension) will be paid directly to Medi-Cal to offset the cost of nursing home care. Where there is a healthy spouse, it is more complicated. The healthy spouse is entitled to a certain amount of monthly income. This is where a good Medi-Cal planning attorney is critical. With the right planning, you can minimize or avoid sharing the cost of nursing home care.
How Do I Qualify for Medi-Cal?
There are many tools in the elder law lawyer's toolbox to help elders become eligible for Medi-Cal. Every client's situation is different and requires a unique plan. Here is a caveat: don't let a nursing home social worker help you with the Medi-Cal application to save legal fees. Here's why - the nursing home's incentive is to collect as much private pay (you're savings) as possible. Unlike the social worker, the elder law attorney will have strategies to minimize or eliminate your out-of-pocket costs.
Medi-Cal will pay for skilled nursing home care only if it's "medically necessary."
To qualify, your doctor must believe your health is at risk without skilled nursing care. To decide what level of care you require, Medi-Cal considers:
- Limitations in activities of daily living (e.g. mobility, assistance with bathing, toileting, etc.)
- Your cognitive and physical function
- Whether you need assistance with medications or treatments
Medi-Cal requirements are complex and change every year. Call our Woodland Hills office at 818-292-8160 or Beverly Hills office at 310-230-5686. Or send us a message via our "Get Help Now" box in the left column.
Income and Asset Limits to Qualify for Medi-Cal
To qualify for Medi-Cal you must show that you have limited resources at your disposal.
You can only have up to $2,000 in liquid assets such as cash, savings, or investments (non-retirement). If married, the healthy spouse can have up to $126, 420 in liquid assets as of 2019.
Some assets are exempt and are not considered in determining Medi-Cal eligibility. These are property exemptions and include:
- Your home
- Personal property, including household items and one vehicle
- Qualified retirement plans (IRA's, 401(k)'s, etc.)
Spending Down to Qualify for Medi-Cal
If you have assets (cash) in excess of the Medi-Cal limit, you may spend down the excess cash. Examples of permissible spend downs include:
- Pay medical bill or any other bills (even payoff your mortgage)
- Buy a car
- Home improvements
- Legal fees
The 30 Month Look-Back
As part of the Medi-Cal application process, they will require 30 months of financial account statements (from the date of application). Medi-Cal is looking for "uncompensated transfers" or gifts. If a gift is revealed (say you gave $50,000 to your son) for the purpose of qualifying for Medi-Cal, you will be subject to a penalty before you can become qualified. For example, if you gifted $50,000, that would result in a penalty of 5 months before you could qualify for Medi-Cal. But there is much more to this analysis. The issue is when does the penalty period begin to run.
It's complicated. That's why you need to consult with an experienced elder law attorney.
The Benefits of Medi-Cal Planning
At the Estate Planning Law Center (in Woodland Hills & Beverly Hills), elder law attorney Richard will help you navigate the complex legal rules of Medi-Cal. Together we can:
- Plan for Medi-Cal eligibility requirements
- Provide asset protection, including your home
- Protect your healthy spouse
- Protect your children's inheritance
One more time, call our Woodland Hills office at 818-292-8160 or Beverly Hills office at 310-230-5686. Or send us a message via our "Get Help Now" box in the left column.