How Does Medi-Cal Treat Income?

Like most things concerning Medi-Cal, understanding what counts as income can be confusing. There are numerous types of income such as countable earned and unearned income, available and unavailable income, in-kind income, and then exempt income. Let’s clarify these different types of income and how they can be counted when determining you or your loved one’s eligibility for Medi-Cal.

Earned Income

Earned income includes wages one received from work, regardless of the form those wages take (salary, hourly, tips, commissions, etc.). All wages must be reported, even if they are untaxed or received “under the table.” Self-employment also counts as earned income, yet there must be records of business expenses as well that must be subtracted to figure out how much of the money brought in is actually earned income.

Unearned Income

This type of income relates to interest on savings and retirement accounts, pensions, annuities, veteran’s benefits, etc. Social Security counts as unearned income as well. Gifts, royalties, and inheritances also count as unearned income.

Available Income

The next factor in treating income for Medi-Cal is whether or not income is available. All available income is factored into the monthly income and Medi-Cal eligibility is based on monthly income. If a person receives income weekly or biweekly, that income is multiplied to figure out the monthly amount. Available income included both earned and unearned income and must be verified by legal documents or, in some cases, a statement under penalty of perjury.

Unavailable Income

Unavailable income is not counted towards Medi-Cal eligibility. This includes funds that the applicant does not have access to. It also includes income brought in by an unrelated adult or adult child living in the home. Worker’s compensation and insurance settlements fall into this category as well.

In-Kind Income

This type of income is tricky. In-kind income refers to assistance in food, housing, utilities, clothing, etc. that is not provided by a relative. It only will count as income if the entire need is provided for. For example, completely free housing would count, but bringing hot meals a couple of times a week would not count.

Exempt Income

There is also a specific category for all types of income that is exempt from Medi-Cal calculations. This area includes public assistance, child support, foster care, disaster and emergency services payments, etc. These funds cannot be counted as income and will not impact eligibility.

As you can see, how Medi-Cal treats income can quickly become complex and confusing. This is why it is not advised to apply for Medi-Cal without the guidance of an attorney skilled in this area. Even if you or your loved one may not qualify right away based on income, there may be ways to qualify in the future. Consult an attorney with any questions about what counts as income and how this will affect your application.