If you look for information on long-term Medi-Cal online, you’ll find many posts—including some of my own—that focus on the initial eligibility determination. That makes sense, because it’s a complex topic on its own and is what most people want to know about.
But planning for long-term Medi-Cal involves so much more than just getting your foot in the door at the outset. A comprehensive long-term Medi-Cal plan should, at a minimum, address three distinct phases through:
- Eligibility planning, which helps people qualify for long-term Medi-Cal.
- Income planning, which helps people who are currently receiving long-term Medi-Cal plan for the needs of a spouse who remains in the community.
- Estate-recovery planning, which protects Medi-Cal recipients’ property after they die.
Read on to learn more about each and how it impacts your long-term Medi-Cal planning.
Long-term Medi-Cal eligibility has two basic requirements: the need requirement and the financial requirement. Naturally, the first requirement is met, or not, without the need for planning—or even the ability to plan. You either need nursing-home care or you don’t.
The second requirement is a financial requirement. Specifically, long-term Medi-Cal is not available if you have non-exempt assets worth more than the Medi-Cal limit. That limit is $2,000 for single applicants, or a bit more than $120,000 for married couples where one spouse will remain in the community.
Remember that those limits apply to “non-exempt assets,” also known as “countable assets.” This is where Medi-Cal planning can be useful. Some major assets—including your house—are not subject to those limits. And with proper planning, the amount of your countable assets can be reduced through a process called spend down.
Once you are receiving long-term Medi-Cal benefits, the state expects you to pay a share of cost if you can. The share of cost is similar to a copay in private health insurance. However, if you are married, there are often ways to reduce the share of cost—or increase the assets that your community spouse is allowed to keep—for your spouse’s benefit. So, your Medi-Cal plan should also address this aspect of your needs.
The final element of a successful Medi-Cal plan is planning for estate recovery. Estate recovery is a process through which Medi-Cal seeks to recover the amount of benefits that it paid for your care by going after your estate’s assets after you die. In other words, Medi-Cal wants to be reimbursed, and it will try to seize your home or other property after you die.
But there are important limitations on estate recovery, and many of them are fairly new. With proper estate-recovery planning, Medi-Cal’s ability to go after your property can be significantly reduced—and often eliminated altogether.
The Time to Plan is Now!
Unfortunately, too many people wait until the absolute last minute to begin thinking about long-term Medi-Cal. Then, in their rush to qualify and help a loved one, they often make simple, but costly, mistakes, including failing to plan for more than just eligibility. That is a recipe for disaster.
It’s never too soon to begin planning for the unexpected, like the need for nursing-home care. The sooner you begin that process, the more options you’ll have at your disposal, and the more comprehensively you can address every aspect of your long-term Medi-Cal needs.