Medi-Cal

 

Medi-Cal 2013 Rates

The Department of Health Care Services (DHCS), which is the agency that administers Medi-Cal, released the last of the 2013 rate adjustments for individuals receiving Medi-Cal in nursing homes.  Here is a list of the important numbers for 2013:

            Average Private Pay Rate is $7,549.  This number is critical in determining the number of months a person is disqualified if gifting has occurred.

            Community Spouse Resource Allowance (CSRA) is $115,920.  This number is the maximum amount of non-exempt resources a spouse of a Medi-Cal recipient can have when the application is filed.

            Minimum Monthly Maintenance Needs Allowance (MMMNA) is $2,898.  This number is of assistance when calculating the share of cost for the Medi-Cal recipient.

            The Resource Allowance for the Medi-Cal recipient is still only $2,000 and exempt income is still $35 per month.

            The Deficit Reduction Act (DRA) has still not, as of the publishing of this article, been adopted in California.  Many tools to protect assets will be eliminated once the DRA becomes effective.  Early planning can save tens if not hundreds of thousands of dollars.

Please Don’t Fall!

One of the biggest, and most frequent, risks for seniors is falling.  My mother-in-law is currently recovering from a fall where she broke her hip.  Luckily she did not suffer from residual issues such as pneumonia, inability to walk again and be wheelchair bound, and fun things like that! 

None of us like those midnight calls saying that your mom has fallen, and is on the way to the hospital, so take some steps to minimize the risks now.  

1)         Remove objects that they can trip on (paper, books, clothes, shoes) from anywhere the senior normally walks.

2)         Remove throw rugs and have edges taped down or otherwise secured.  Seniors “shuffle” when they walk so it is easy for them to get caught on the carpet edges.  Their walkers also can pull up carpet edges.  Use non-skid mats in the bathroom.

3)         Eliminate furniture risks.  My mother-in-law caught her foot on the edge of her bed leg and it took her down.  All furniture has legs.  Pick furniture where you cannot get your foot underneath.  If you already have the furniture, protect those areas where a foot can get caught with plexi-glass or wood.  May not look great but it is safer.

4)         Provide easy access to everything they need without the necessity of any elevating devices (footstool, etc).

5)         Install grab bars, not only in the bathroom by the toilet and shower, but perhaps by their bed, near their recliner, etc.  There are numerous devices on the market, so take a look at them.

6)         Improve lighting everywhere in the home.  Not romantic but much safer.

7)         Always have them wear good shoes.  Get rid of slippers and try to discourage going barefoot. 

The above are just some thoughts on the topic.  Don’t procrastinate on this.  Having your mom or dad suffer through 8+ weeks of rehab is not pleasant.  These are simple things that can be done to minimize the risks.  I do confess that I took much of this material from the May, 2012 InTouch at Home newsletter so I am giving them credit for the above notes.

 

Medi-Cal Draft Regulations have been issued

The long awaited draft of the Medi-Cal regulations implementing the Deficit Reduction Act of 2005 (DRA) have been issued and are out for public comment.  Those that have assets are targeted.  To read the material changes to current law, see below. 

1)         An increase in the look-back period to 60 months

2)         The penalty period will start with the date of application and not the date of the gift

3)         Requires the applicant to disclose any interest in an annuity and requires the State of California to be names as the remainder beneficiary (for purposes of securing the recovery)

4)         The equity limit in a residence to be $750,000

The new rules take a lot of tools out of our Medi-Cal planning tool box.  If there is a long-term care need in the immediate future, planning now could be grandfathered.  Once these rules are in effect, our job as attorneys has become much tougher, more expensive to clients, and perhaps not as effective.

How can I protect my Home if I am on Medi-Cal? Part 2 – the Solutions

The Department of Health Care Services (Medi-Cal) can attach your home to satisfy their recovery claims (reimbursing the State of California for all Medi-Cal benefits paid to the recipient).  So now what?  Well, there are some techniques to avoid this recovery claim provided that steps are taken PRIOR to the death of the Medi-Cal recipient (or sometimes the spouse).  Some of those include the following, albeit that there are pros and cons to each of these that need consultation with a long term care planning attorney to determine the best approach for each situation. 

Create a life estate, gift the entire interest in the home to the kids prior to death or create an irrevocable trust to hold the home.   Each approach has its pros and cons and needs to be discussed in detail with an estate-planning attorney.  California is for the most part applying the law that existed in 1989.  However, the state legislature is currently changing the rules and the laws will be much more restrictive.

 You owe it to yourself to protect your assets NOW while you are competent to make decisions and while the laws are still favorable in California.  Call my office or complete an inquiry through my website for additional information. 

 

How can I protect my Home if I am on Medi-Cal? Part 1 – the Problem

I have heard on numerous occasions from purported “experts” in Medi-Cal planning that the home is “completely exemp for Medi-Cal.”  Unfortunately this is “not completely correct” and your family could have a big surprise if proper planning is not done while you are competent to do so…read more.

In California, a residence is exempt if it is your residence and you intend to return home. However, this exemption is for ELIGIBILITY purposes only.  It is NOT EXEMPT from “recovery”.  In other words, after a Medi-Cal recipient passes away, the Department of Health Care Services (Medi-Cal) can and will seek reimbursement from the decedent’s assets, including the residence. I have found that Medi-Cal does not negotiate on the amount and only very rarely have I been able to successfully argue for a hardship waiver for the heirs.

 In general, this right of recovery attaches to all assets that transferred by right of survivorship, like joint tenancy, through a living trust (surprised?), assets transferring through a probate, annuities, and other certain types of transfers.  Additionally, even though the Medi-Cal cannot recover from a transfer to a spouse until that spouse has died, they can and will most likely pursue recovery from the heirs after the spouse has died.  I have had clients come to me with a Medi-Cal recovery claim for dad’s benefits that he received years and years ago, but the State of California just recently legally pursued recovery due to mom’s death  (surprised?).

 Part 2 will address some solutions.