Medi-Cal and Long-Term Care: A Primer

You should understand the basics when it comes to Medi-Cal and long-term care. Many aging persons will require living assistance at some point in time, and Medicare will not pay for help with your activities of daily living.

Nursing homes and assisted living communities are extremely expensive, and in-home care givers are also costly. Medi-Cal does pay for long-term care, and it is the solution for many Californians.

In this post, we will provide some basic information about the Medi-Cal program as it applies to long-term care for seniors.

Asset Limit

Medi-Cal is a program that is only available to people who can demonstrate a significant level of financial need. As a result, there is a $2000 limit on “countable assets” for an individual applicant.  Higher limits are available for married couples.

Some Things Don’t Count

Some things that you own are not considered to be countable assets for Medi-Cal purposes. Your home is not considered to be a countable asset, and currently there is no equity limit in California.

One vehicle that is used as a primary source of transportation is not countable, and your household goods and personal effects would not be countable assets. Your wedding ring, your engagement ring, and your heirloom jewelry are not countable. Plus, you can have unlimited term life insurance and a whole life insurance policy valued at up to $1500.  Certain retirement accounts and annuities are also not counted.  However, careful planning with an experienced and qualified elder law attorney is often required to obtain the best results.

Rights of the Healthy Spouse

If you were to seek Medi-Cal eligibility to pay for long-term care while your spouse was still capable of living at home as usual, your spouse would be able to keep half of the shared countable assets without impacting your eligibility status. This is called the Medi-Cal Community Spouse Resource Allowance.

Unfortunately, there is a maximum limit. In California, this limit stands at $119,220 in 2015. Even if this figure represents more than half of the shared countable assets, the healthy spouse can keep up to $119,220.

The healthy spouse may also be entitled to a Monthly Maintenance Needs Allowance. Under other circumstances, most of the income that is brought in by a Medi-Cal recipient must go toward the cost of the care that is being received. However, when a healthy spouse is relying on the income, he or she can continue to draw from it.

During the current calendar year, the Medi-Cal Monthly Maintenance Needs Allowance is $2981.

Look-Back Period

If you want to give gifts to your loved ones to stay within the asset limit, in general, you must complete the gift giving at least 30 months before you apply for Medi-Cal if you want to obtain eligibility right away.  There are significant exceptions to this rule about which an experienced and qualified elder law attorney can advise you.

Our Firm Can Help

We have looked at the basic framework in this blog post. If you like to take the next step, contact us through the following link to set up a consultation: Sacramento CA Elder Law Attorneys.

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Timothy P. Murphy

Timothy P. Murphy is an estate planning and elder law attorney whose practice emphasizes helping people to build, preserve and pass on their wealth. He works with his clients to accomplish their goals while avoiding unnecessary court proceedings and minimizing or eliminating exposure to death taxes.

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