In this blog, we will address how eligibility for Medi-Cal long term care (LTC) benefits is established.
Eligibility is essentially an asset test. For eligibility purposes, assets fall within one of three categories: countable (non-exempt), not countable (exempt) and unavailable (countable, but not counted).
To be eligible for Medi-Cal LTC, an individual applicant’s countable assets must be below $2,000. If the applicant is married, in 2015, the spouse can have another $119,220 of countable assets.
Countable assets are typically liquid assets, such are cash, savings, investments, some retirement accounts, some real estate, some life insurance and annuities, etc. There are, however, many other types of assets that may be countable.
Non-countable assets are property such as a primary residence, one auto, household furnishings, some jewelry, certain retirement accounts, certain life insurance, among others.
Unavailable assets include property that would normally be considered countable, but, under certain circumstances, is not counted. For example, it could be investment property co-owned with another person or non-residential property that is unmarketable.
Effective Medi-Cal eligibility planning requires a comprehensive knowledge of the myriad of Medi-Cal rules and regulations so that assets which would otherwise be counted, resulting in a failed Medi-Cal application, are made either exempt or unavailable. For this reason, it is critical to work with a qualified, experienced elder law attorney who regularly works in the Medi-Cal planning field.
CAUTION: Beware of the many non-attorney so-called Medi-Cal “experts” who may be insurance or annuity sales persons, or other unqualified persons who prey on folks seeking needed Medi-Cal LTC benefits. They may even claim to have special certification or training. Don’t be fooled! Only a licensed attorney will have the skills and ability to legally assist with ALL the Medi-Cal planning strategies that are available. Non-attorneys will inevitably limit their recommendations to strategies in which they can make a profit, e.g., a commission on a product sale, or, some less than optimal and incomplete strategy since they typically have limited knowledge of this complex area of law and cannot competently and legally prepare the needed legal documents or pursue helpful court petitions. Many also don’t understand or care about the potential adverse tax and other legal consequences that bad or incomplete planning can cause.