There is a common misconception that, if you are relatively healthy right now, you don’t need to consider future long-term care. While you may not have health issues right now, you cannot predict how healthy you will be 30 or 40 years from now. The reality is, an unexpected injury could leave you with health issues that ultimately require long-term care as well. More than two-thirds of all residents over the age of 65 need long-term care at some point in their lives. Therefore, it would be a mistake to overlook Medi-Cal planning. If you want to know if you will meet the requirements for Medi-Cal eligibility and other important information regarding the California Medi-Cal program, here is what you need to know.
The basics of Medi-Cal eligibility
Medi-Cal is basically a benefits program for which you can qualify in a few different ways. These are referred to as eligibility categories. For example, SSI-Linked Medi-Cal is an eligibility category which allows individuals who qualify for Supplemental Security Income (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 any eligibility category, you are considered eligible for either full or partial-scope Medi-Cal.
Common eligibility categories for individuals with disabilities
If your family has income at or below 138% of the Federal Poverty Level, you may be eligible for Income-Based Medi-Cal. If you are aged or disabled, you may be eligible for Aged & Disabled Federal Poverty Level Medi-Cal. If you are disabled and working, you may be eligible for California’s Working Disabled Program.
If you are aged, blind, or disabled, but your income is too high for other Medi-Cal programs, you may be eligible for Aged, Blind, and Disabled – Medically Needy Medi-Cal. For this program, you may need to “spend down” a certain amount of your own money before Medi-Cal begins to pay for medical services. This payment is called a share of cost. For more specific information on Medi-Cal eligibility, you can visit this link.
Healthy people often need long-term care in the future
Far too often, people overlook the fact that illness is not the only reason you may need long-term care. For instance, if you suffered a terrible injury following an automobile accident, there is certainly a possibility that you will need long-term care in order to fully recover from that injury. In many cases, loved ones are admitted to nursing homes because of the need for daily assistance with activities such as dressing and grooming, simply as a result of aging.
Health insurance usually does not cover the cost of long-term care
Regrettably, far too many people misjudge 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 $90,000. 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.
How does Medi-Cal work for California residents?
One of the main differences between Medicare and Medicaid, or Medi-Cal as it is known in California, is that Medi-Cal is an income-based health care assistance program. Federal, state and local tax funds are used to aid eligible individuals with paying their medical expenses. Generally, Medi-Cal recipients are only required to pay a small co-payment for covered medical expenses, if anything at all. Medi-Cal will typically pay for some in-home services, but only if a physician certifies that home care services are actually needed for specified medical reasons.
Why you need to consider Medi-Cal planning
The purpose of Medi-Cal benefits is to assist low-income California residents in paying for medical services. Because Medi-Cal is a needs-based program, recipients can have no more than $2,000 in assets. The goal of Medi-Cal planning is to keep you from exhausting all of your resources in order to be eligible for benefits.
Similarly, 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.
Download our FREE estate planning checklist today! If you have questions regarding Medi-Cal eligibility, or any other elder planning needs, contact the Northern California Center for Estate Planning and Elder Law for a consultation, either online or by calling us at (916) 437-3500.