What is Medi-Cal?

Elder Law Topic Tuesday by Attorney Esther Wang

Medi-Cal is California's Medicaid program financed by the federal and state government. It is a public health insurance system that provides necessary health care services for children and adults with limited resources and income. Most people are familiar with Medi-Cal benefits that are available for low-income individuals, however, most people are not aware of long-term care benefits under Medi-Cal, including:

• Home care through IHSS, or In-Home Supportive Services
• Assisted living care through Assisted Living Waiver program
• Skilled Nursing Care
• PACE program

INCOME & ASSETS

To qualify for Medi-Cal based on your income, your annual earnings must be less than 138% of the Federal Poverty Level for your household size (266% of FPL if you are a child). Therefore, to qualify based on your family size, your annual income cannot exceed:

• One-person household: $ 17,609
• Two-member household: $23,792
• Three-member household: $29,974
• Four-member household: $36,156
• Five-member household: $ 42,339

 Medi-Cal offers free or low-cost healthcare coverage for residents of California who meet the eligibility requirements. If your application for Medi-Cal is approved, your healthcare coverage will be available through a managed care program.

LOOK-BACK PERIOD

Medi-Cal imposes a "look-back" period which prohibits applicants from transferring assets out as gifts or selling below the fair market value to meet income and "countable resources" limits. The look-back period in California is 30 months. For each $6,840 of gifts given during the "look back" period, the person loses one month of Medi-Cal eligibility.

MEDICALLY NEEDY PATHWAY

California residents who are over the age of 65 years and do not meet the Medi-Cal eligibility requirements can qualify for Medi-Cal through the Aged, Blind and Disabled — Medically Needy Program (ABD-MN). 

The program takes the person's countable monthly income into account and deducts a predetermined Maintenance Need Allowance (MNA). As of 2021, MNA in California is:

• $600 for individuals
• $934 for married couples

Your cost of share will be used to pay for the medical bills. 

REASONS TO TAKE ADVANTAGE OF MEDI-CAL

As mentioned above, long-term care can be costly in the long run. Taking advantage of Medi-Cal planning helps individuals and families carefully plan for the expensive costs of long-term care. With Medi-Cal planning, families can protect assets like property and finances. It can also ensure that you do not end up spending down your retirement savings on nursing home care or assisted living.

According to a 2020 Financial Cost of Care Survey from Genworth.com, the median cost of community and assisted living in California is $5,000 per month, while nursing home care costs approximately $9,247 per month.

Planning for long-term care is essential to ensure that seniors and families are not overwhelmed with the financial toll. With adequate Medi-Cal planning, families can better manage the financial aspect of long-term care and preserve their assets for future generations.

If you want to understand your options regarding California's Medicaid program, Medi-Cal, it is important that you speak with an experienced California estate planning attorney for proper guidance.

At The Elder & Disability Law Firm, APC, we have the experience and resources necessary to guide clients in estate planning matters, including long-term care and Medi-Cal planning. Our team is available to discuss your unique situation and explore your available Medi-Cal options, including Medi-Cal programs for home care, assisted living care, and skilled nursing care. We will offer you the comprehensive legal counsel, assistance, and advocacy you need to make crucial decisions.

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6/1/2021