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Modern Estate Planning Blog

Elder Law & Special Needs Planning

Medi-Cal Changes the Rules Making It a Bit Easier to Keep Your Assets

January 24, 2017

Our Sacramento Elder Law attorneys have written many articles on this site about how you must surrender, or spend-down your assets in order to qualify for Medi-Cal. You can learn more about Medi-Cal planning here.  Well, here in California, things are changing – and this time the changes are in your favor!

There have been changes to Medi-Cal rules before, but they were rarely on the side of the person who needed assistance. This time, they have identified services for which they can no longer recover (meaning, they can’t take your assets) and they changed how the recovery process works.

Here are a few of the highlights:

They can no longer take your home from your surviving spouse or domestic partner.

Before the change, Medi-Cal would allow the surviving spouse to keep the shared home but the asset would then be subject to recovery when the spouse died.  Many times the result was that the family had to sell the family home in order raise the cash to pay the Medi-Cal recovery bill.

Only nursing home and community-based services are recoverable.

Prior to the change, all fees for services were eligible for recovery. Now, they are allowed to recover only the nursing home and community-based costs for people over 55.

The state must waive claims for hardship if the home is of “modest value.”

This means that if your home is 50% or less of the average of other homes in the county, the hardship claim is waived.

Medi-Cal recovery is limited to assets in the person’s probate estate.

This is a big one. This means that assets that are passed outside of probate (such as assets in your living trust!) are now exempt from Medi-Cal recovery.  Yet another reason for you to consider protecting your assets with a trust!

It is important to remember that while the recovery rules have been modified in your favor, you must still plan ahead in order to qualify for Medi-Cal. So, working as soon as possible with an elder law attorney in Sacramento is critical.  If you haven’t yet discussed Medi-Cal planning with an estate planning attorney, we invite you to call our office to schedule a Peace of Mind Planning Session.  Call us today at (916) 241-9661.

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A wonderful job! After watching my family deal with litigation after a death, this is so important for everyone, young and old.

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