One of the primary concerns clients have about Medi-Cal eligibility deals with previously transferred assets. In many cases, clients have already taken some bad advice and given away their assets in anticipation of applying for Medi-Cal benefits. However, as Medi-Cal planning lawyers understand, there are still options even for your previously transferred assets. Here is what you need to know.
Medi-Cal eligibility for Sacramento residents
Medi-Cal is essentially one basic benefits program that you can qualify for in several different ways known as eligibility categories. For instance, SSI-Linked Medi-Cal is an eligibility category which allows individuals who qualify for SSI to automatically qualify for Medi-Cal benefits. There are more than 90 eligibility categories, each with its own rules and requirements. Once you meet the requirements of an applicable eligibility category, you will be considered eligible for either full or partial Medi-Cal benefits.
The benefits of Medi-Cal planning
The purpose of Medi-Cal benefits is to assist eligible California residents in paying for medical services. Because Medi-Cal is a needs-based program, recipients generally can have no more than $2,000 in what are known as “countable” assets. The goal of Medi-Cal planning is to keep you from exhausting all of your essential resources, such as your home and car, in order to be eligible for benefits.
Also, if an applicant for Medi-Cal gives away property or assets right before submitting an application, those transfers of property can be seen as fraudulent and result in your benefits being delayed or denied. However, with careful Medi-Cal planning, you can avoid the appearance of fraudulent transfers.
It may be possible to qualify shortly after transferring assets
It is not true that all California residents must wait 30 months before applying for Medi-Cal benefits if they have transferred assets. In a time of crisis, it is possible to qualify in a shorter period of time. Also, with proper planning, with the help of experienced and qualified Medi-Cal planning lawyers, you may be able to protect most, if not all, of your assets. The key is understanding the Medi-Cal rules and how they apply to each client’s situation.
Plan by re-including the previously transferred assets in your calculations
When a client has already transferred assets before considering applying for Medi-Cal benefits, a technique sometimes used by Medi-Cal planning lawyers involves calculating eligibility by re-including the transferred assets. The first step is to identify which assets have been transferred within the last thirty months. The total amount of those transfers is then added back into the total amount of the client’s assets, just as though the client still owned them.
That way, your Sacramento Medi-Cal planning lawyers can make a more accurate assessment of the client’s assets that will be countable, should the client need long-term care within that thirty month period.
Determining which assets will be protected and what is required for funding care
Once the previously transferred assets have been re-included in the total amount of countable assets, it is necessary to determine which assets can be protected and which assets will be required to cover your care. Pre-transferred assets relate more to funding your long-term care than to determining eligibility. The previously transferred assets must be allocated to the protected amount of assets, so the client only needs to fund the balance.
In cases where the amount of the previously transferred assets exceeds the amount of protected assets, then you may need to make up for that excess by giving it back. If, on the other hand, the amount is less that the protected amount, the balance of the assets can be applied to an appropriate asset protection plan. While this process may seem complicated, experienced and qualified Medi-Cal planning lawyers have the experience to assist you with proper planning, even in cases where assets have already been transferred.
Health insurance typically does not cover the cost of long-term care
The reality is that far too many people fail to consider the real cost of long-term care, which is typically rather expensive. The average annual rate of long-term care in California is more than $94,000. Add to that the likelihood that nearly half of the California citizens age 65 and older need long-term care for approximately five years. That can be overwhelming enough. Yet, there is a common misconception that Medicare and private health insurance will be sufficient to cover the costs of long-term care. In reality, they cover very little of these costs.
If you have questions regarding transferred assets or any other Medi-Cal planning matters, please contact the experienced attorneys at the Northern California Center for Estate Planning and Elder Law for a consultation. You can contact us either online or by calling us at (916) 437-3500. We are here to help!