Medi-Cal Qualification

Medi-Cal vs. Medicare

Qualifying for Long Term Care Medi-Cal is a highly specialized area of the law. The law is derived from Federal laws (SSA, Disability, Erisa, Tax Code and Regulations); State Laws (Probate, Welfare and Institution, Contract, Agency).

A law firm must have a complete understanding of these laws and how to apply them.

Need Medi-Cal Related Help?

Medi-Cal Qualification

We will compare Medicare vs. Medi-Cal; what Medi-Cal requires to qualify; what you can have as resources(assets) and income and what type of planning can be accomplished by our law firm, and the current status of the laws. Do not let your heart be troubled, we can help you.

MEDICARE vs MEDI-CAL

MEDICARE

Medicare is a federal insurance program that is paid out of your Social Security Award. Persons over 65 years or older that have made Social Security contributions are entitled to the benefits, and if you are under age 65 with disabilities you may also be eligible.

Medicare has a Part A, which includes Hospital Insurance and Part B which covers Medical Insurance.

Medicare has limited coverage for skilled nursing care. After 3 days of prior hospitalization, Medicare will pay 100% for the first 20 days of skilled nursing care and for the next 21-100 days the patient will make a co-payment. There is no coverage for nursing home care beyond the 100 days in any single benefit period.

Medicare only pays for “skilled nursing care” it does not pay for “custodial care “and the average stay in a nursing home under Medicare is usually less than 24 days.
Medicare will not cover you if you have substantial nursing home costs.

MEDI-CAL

Medi-Cal is a combined federal and California State program established to help pay for medical care for public assistance recipients and other low-income and resource persons.

Medi-Cal is a needs-based program for which you must qualify.

SSI and other categorically related recipients are automatically eligible. Other whose income and or assets would make them ineligible for public benefits may also qualify as “medically needy” if their income and resources are within the Medi-Cal limits.

Resource Limitations require the recipient to demonstrate that she/he has limited resources available and they are no more than $2,000 for a single individual, this has been the amount since January 1, 1989. Medi-Cal has several “categories”. The first category will hold all the properties that are considered “exempt.” The second category will hold the “unavailable” assets and the third category will hold the “non-exempt properties.”

The following property is generally exempt and therefore not counted to determine eligibility.

  • The Home: totally excluded if it is the principal residence. Includes mobile home, houseboat, or an entire multi-unit dwelling if any portion serves as the principal residence of the applicant, and buildings surrounding, contiguous to, or appertaining to the residence. The property remains exempt if a person in a nursing home or the person’s representative expresses an intent to return home on the Medi-Cal Application and Statement of Facts, or in a Trust.
  • Other Real Property: can be exempt if the net market value of the property ( assessed value or fair market value, whichever is less – minus any encumbrances such as mortgages, loans, etc.) is $6,000 or less and the beneficiary is “utilizing” the property, i.e., receiving yearly income of at least 6% of the net market value.
  • Household Goods and Personal Effects: totally exempt.
  • Jewelry: for a single person, wedding, engagement rings and heirlooms are totally exempt and other items of jewelry with a total net market value of $100 or less are exempt; for spouses, when one spouse is in a nursing home, there is no limit on exempt jewelry for determining institutionalized spouse’s eligibility.
  • Cars/motor Vehicles: one vehicle used for transportation is totally exempt.
  • Whole Life Insurance: policies with a total face value of $1,500 or less. If the total face value of the policy or policies exceeds $1,500, then the cash surrender value of the policies is counted toward the $2,000 cash reserve
  • Term Life Insurance: totally excluded.
  • Burial Plots: totally excluded.
  • Prepaid irrevocable burial plan of any amount and $1,500 in designated burial funds: There is no limit on the amount of the irrevocable burial fund, but the $1,500 in designated funds must be kept separate from all other accounts and designated as a burial account.

The unavailable category will hold the following type of assets.

  • IRAs and work-related pensions:
    • In applicant’s/beneficiary’s name: The balance of the IRA or the pension is considered unavailable if applicant/beneficiary is receiving periodic payments of interest and principal.
    • In spouse’s name: The balance of the IRA or Pension fund is totally exempt from consideration and is not included in the community spouse resource allowance (CSRA).
  • Non-work-related annuities: Annuities purchased prior to 8/11/93: Balance is considered unavailable if applicant/beneficiary is receiving periodic payments (of any amount) of interest and principal. Annuities purchased after 8/11/1993 are covered by special rules.

The non-exempt category will hold pretty much everything else.

Spousal Impoverishment rules
California law allows the well spouse known as the community spouse to retain a certain amount of otherwise countable resources available to the couple at the time of application. This is called Community Spouse Resource Allowance (CSRA) and it increases every year according to the Consumer Price Index. The current (2020) CSRA is $128,640. California law allows the community spouse to retain a maximum monthly maintenance need allowance (MMMNA). The current (2020) MMMNA is $3,216. This amount is adjusted annually by a cost of living increase.

So, what does Medi-Cal cover?

Medi-Cal pays for health care services which meet the definition of “medically necessary.” Services include: some prescriptions (although the Medicare Part D program now covers most prescriptions), physician visits, adult day health service, some dental care, ambulance services, some home health, X-ray and laboratory costs, orthopedic devices, eyeglasses, hearing aids, some medical equipment, etc.

All covered services, or the remaining costs over the share of cost of nursing home care, will be covered if the individual meets income/resource requirements. Some services such as home health care, durable medical equipment, and some drugs require.

How we can help you to qualify for Long Term Care Medi-Cal Benefits?
The laws permit, under certain guidelines, the ability to reduce your resources to the required property limits. Giving property away is not the solution as there are penalties for transferring or gifting away non-exempt asset for the purpose of applying for Medi-Cal benefits. A transfer of a non-exempt asset can result in a period of ineligibility which is the lesser of 30 months or the value transferred divided by the average private pay rate at the time of application.

Medi-Cal applicants, beneficiaries and their spouse should know that Medi-Cal has laws that mandate the State of California to recover for monies expended on behalf of a Medi-Cal recipient. You do not want to get a bill for thousands of dollars from the Department of Health Services.

We at Copenbarger & Copenbarger understand the laws and we have helped hundreds of families qualify for Medi-Cal benefits. We know the laws and we know how to apply them.

California has not implemented the Federal Regulations that other states have implemented. Those regulations go by the acronym of the DRA rules. California is operating under older and more generous planning opportunities, once California implements the DRA regulations a lot of the current planning opportunities will cease to be available.

It is imperative, if you or anyone that you know, has the need to qualify for Medi-Cal, they should contact our office immediately.