MEDI-CAL CRISIS PLANNING

Sudden Changes and Big Decisions

Change is life's only constant. Sometimes these changes strike without warning. If you or a loved one has experienced a sudden illness or serious accident, you understand how abruptly everything can change. Are you or a loved one suddenly in need of nursing home care? Finding and affording quality care on short notice can be stressful and draining. We can help you determine the best options for care and how to qualify for Medi-Cal to help finance them.

Long Term Care: Counting the Cost

Long-term care is expensive, and these costs only continue to increase as baby boomers age. Although the range varies depending on where you live, according to the American Association for Long-Term Care Insurance, the annual cost of care will double in the next 20 years, increasing from $73,000 to $131,800. With improved medical care, the average life span of adults also is increasing; this translates into more years of care at increasingly higher rates. Without some sort of financial assistance, these costs could be financially devastating. In fact, your entire life savings could be quickly depleted within a few years of needing long-term care. This is where Medi-Cal can help.

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Medi-Cal is a joint federal and state program to assist those with low income and limited resources. While Medicare provides very limited long-term care coverage, Medi-Cal is much more extensive. However, because of its restrictions, qualifying for Medi-Cal can be extremely difficult. But paying for a nursing home without it could be all but impossible.

The Medi-Cal Maze

Although Medi-Cal requirements vary from state to state, they all share one common element: complexity. Each state specifies a maximum allowed income for individuals and couples in order to qualify for Medi-Cal. Also, the applicant's total assets cannot exceed a specified amount called the Individual Resource Allowance, which is consistently very low, often less than $2,000*. Although certain possessions, like your home and automobile, are "exempted" for purposes of determining Medi-Cal eligibility, this figure is still alarming. If the applicant is married, the process becomes more complicated. For the recipient to qualify for Medi-Cal in any state, the applicant's spouse can keep only half the couple's assets up to a Maximum Community Spouse Resource Allowance of $119,220. So, if a couple has $119,220* in assets, they must "spend down" to all but $61,610 - $2,000 (or whatever the state Individual Resource Allowance is) for the applicant and $59,610 for the spouse - on long-term care.

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What can you do if the value of your "non-exempt" assets exceeds the $119,220* Maximum Community Spouse Resource Allowance? If you give your extra assets away, which seems like an obvious choice, you will encounter greater problems. Violating this "Transfer Penalty Rule" could disqualify you from receiving Medi-Cal for months or years, depending on how much you gave away.

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If your need for nursing home care is immediate, time is not something you can afford to lose. Why? If you wait too long and your non-exempt assets fall below the maximum $119,220 limit, then the applicant's spouse can only keep half of what is left ... with $23,844* as the Minimum Community Spouse Resource Allowance. In other words, $59,610* truly is the Maximum Community Spouse Resource Allowance!

Medi-Cal Qualification Process = 
Legally Protecting the Maximum Amount the Law Allows

This is only a brief and oversimplified review of a few Medi-Cal rules, of which there are myriad more. Navigating them on your own could be a nightmare at best and subject you to penalties at worst. Fortunately, though, our experienced professionals can guide you through the Medi-Cal maze. We can advise you throughout the application process, ensuring that you retain the maximum income and total assets allowed by law.