Frequently Asked Questions About Medicare and Medi-Cal (Medicaid)
What is the difference between Medi-Cal and Medicare?
- Medicare. Anyone who is age 65 or older and who is covered by Social Security or Railroad Retirement Benefits is eligible to receive Medicare. Medicare also covers persons who are disabled under certain circumstances. Medicare Part A provides hospital insurance; Medicare Part B, if you are entitled to it, covers 80% percent of other medical expenses. Medicare is not needs based, that is, your entitlement to Medi-Care benefits does not depend on the value of your assets.
- Medi-Cal (Medicaid). Medi-Cal is California's name for the federal Medicaid program. Medi-Cal is the only government program that pays the on-going cost of nursing home care for eligible person who cannot afford to pay for such care. Medi-Cal recipients are either "categorically eligible" (because they receive SSI or AFDC benefits) or are eligible because they are "medically needy". Medi-Cal for long-term care is needs based; you often have to spend down in order to qualify.
How does a person qualify for Medi-Cal? How does one apply for Medi-Cal?
- SSI Recipients. Individuals who receive Supplemental Social Security Income (SSI) automatically qualify for Medi-Cal. SSI is the federal program that guarantees a minimum monthly income for the elderly, blind and disabled. It is available only to individuals with countable assets (assets which are not exempt) less than $2,000.00 and who have a limited monthly income.
- Medically Needy Recipients. An individual who is 65 years or older, blind or disabled will be eligible for Medi-Cal in a skilled nursing facility or intermediate care facility if he or she meets the resource limitations. The resource limitation is $2,000.00; however, a number of assets are exempt and do not count as an available resource, the most important of which for most individuals is the home; the home is exempt as long as the applicant has the subjective intent to return home. In other words, in most cases, you do not need to sell or encumber you home to qualify for Medi-Cal.
- Transfer Of Assets In Order To Qualify. For countable assets, you need to be aware of Medi-Cal's transfer of assets rules. Giving away countable assets in order to qualify for Medi-Cal can result in a significant penalty period during which Medi-Cal will not be available.
- Where One Spouse Needs Long-Term Care. The rules are far more generous for a married couple where one spouse needs long-term care. An institutionalized spouse will qualify for Medi-Cal if the couple (treated as a family unit) spends down its countable assets to the CSRA allowance. The CSRA (community spouse resource allowance) for 2017 is $. The CSRA is retained by the community spouse; the institutionalized spouse is still subject to the $2,000.00 property reserve. After the institutionalized spouse becomes eligible for Medi-Cal, the community spouse may acquire assets in his or her own name in excess of the CSRA without affecting the institutionalized spouse's eligibility. There are also rules which help ensure the at-home spouse has sufficient income for his or her needs.
- Interspousal Transfers. Transferring assets from the institutionalized spouse to the community spouse, either by institutionalized spouse, if he or she is able to do so, or under existing estate planning documents which authorize gifting between spouses, or by court order. The spend-down of a couples countable assets to the CSRA level, if necessary, often offers opportunities to help protect the family without adversely affecting the institutionalized spouse.
- Applying For Medi-Cal. Some facilities will assist you in the application for Medi-Cal. You can also apply directly with the county or use the services of a private company, such as Senior Medi-Benefits (http://www.seniormedi-benefits.org/) which will be your advocate with the county.
Under what circumstances can the state of California recover what they have paid for my care after I die?
- Requirement That DHCS Be Notified Of Death. California law requires that the Department of Health Services be notified of the death of a Medi-Cal recipient, in writing, within 90 days of death. A certified copy of the recipient’s death certificate should be included with the notification. The state of California has authority to recover the amount of medical expenses it paid after the death of the Medi-Cal recipient; however, effective for Medi-Cal recipients who die on or after January 1, 2017, only assets which would constitute a deceased Medi-Cal recipient’s “estate” are subject to recovery. Remember that simply because an asset is exempt for the purpose of qualifying for Medi-Cal, it may still be subject to recovery after death if it is still in the name of the recipient.
- When DHCS Cannot Claim. The state may not make a claim if the Medi-Cal recipient is survived by a spouse. DHCS cannot claim if the Medi-Cal beneficiary is survived by a minor or disabled child or where the claim would constitute undue hardship.
- Arranging your assets to qualify for Medi-Cal and/or avoid recovery is complex and should only be done after consulting with an attorney and fully considering all of the consequences.
What is a Special Needs Trust?
A person with a disability is often entitled to receive Supplemental Security Income (SSI) benefits. To qualify, the person can have no more than $2,000.00 of countable resources, and limited income. SSI is a very important benefit since it entitles the recipient to Medi-Cal benefits.
A parent who wishes to benefit a child with a disability after the parent's death can do so by providing for the creation and funding of a special needs trust, a very restrictive trust designed to provide for the child's needs which are not met by public benefits, while, at the same time, not disqualifying the child from continued receipt of SSI. The assets in a properly structured special needs trust will not be considered available to the beneficiary during his or her lifetime, nor will the trust assets be subject to recovery by the state upon the death of the beneficiary.
What else do I need to know about Medi-Cal?
Just this: there is a great deal of misinformation about qualifying for Medi-Cal, much of which unfortunately appears to be generated by nursing homes. You should not act based on what you've heard except from someone who's qualified in the area. An excellent resource for information in this area is the website for The California Advocates For Nursing Home Reform (CANHR): Http://www.canhr.org