Common Medi-Cal Asset Transfer Mistakes

On Behalf of | Apr 25, 2022 | Blog |

In California, Medi-Cal, California’s Medicaid program, is often an essential resource for those who need long-term care services. However, the program may disqualify a Medi-Cal applicant with too many resources. As a result, when someone is trying to qualify for Medi-Cal, they may quickly transfer or sell their assets. While this is an understandable reaction, it could make matters worse. The good news is that there are ways to avoid Medi-Cal asset transfer problems. By knowing some of the common Medi-Cal asset transfer mistakes, you can avoid making them.

Not Planning for Medi-Cal Ahead of Time

One common mistake people make concerning their Medi-Cal assets is not planning for them ahead of time. When someone needs Medi-Cal to pay for nursing home or other long-term care, it’s usually because they have had a serious injury or health condition. The time to plan for this crucial resource is before it becomes necessary. Medi-Cal is needs-based, meaning that to qualify for benefits, a recipient’s income, assets, and property cannot exceed a certain financial limit. Fortunately, there are steps you can take to safeguard your property while preparing to apply for Medi-Cal. If you believe you will need Medi-Cal in the future, contact an experienced Medi-Cal planning attorney today to discuss your planning options.

Not Considering the “Medi-Cal Lookback” Period

Another common mistake people make when transferring assets to qualify for Medi-Cal is not being aware of the Medi-Cal lookback period. The Medi-Cal lookback period is up to a 30-month time frame before you apply for coverage. During this period, Medi-Cal will examine your asset transfers and other transactions. The program conducts this review to help ensure that applicants have not sold or transferred their assets in a manner that is against Medi-Cal’s rules. If you transfer assets incorrectly or sell them for less than the fair market value during the lookback period, you could be disqualified from program coverage.

The good news is that you can plan for asset protection and your eligibility during the lookback period. However, it’s crucial that you do so carefully and will full knowledge of Medi-Cal’s rules and requirements. The best way to prepare for Medi-Cal and plan for your assets is by working with an experienced California Medi-Cal planning attorney.

Not Taking Advantage of Medi-Cal Exemptions and Exceptions

A common mistake people make regarding their assets is not taking advantage of Medi-Cal exemptions and exceptions. Although you need to be careful when transferring assets during the 30-month lookback period, Medi-Cal allows for some exceptions. You may be able to transfer your assets to certain individuals and into specific types of special trusts without endangering your eligibility. Your Medi-Cal planning attorney can help you identify exempt assets and other program exceptions.

Not Considering Spousal Issues

Another area that someone transferring assets may overlook is spousal protection. The law recognizes that there can be situations when one spouse needs long-term care, and the other does not. While Medi-Cal has specific income and asset limitations that apply to the applicant, the rules for their spouse will be different.

A Medi-Cal applicant’s spouse will be subject to some restrictions. However, they generally are permitted to have more income and property than a Medi-Cal recipient. There are also other protections for spouses that can help them meet their financial needs. Your Medi-Cal planning attorney can explain more about how the program will treat your spouse and their assets and income.

Changes to Medi-Cal for Medicare Recipients

Due to a change in the law, the Medi-Cal asset test, as applied to adults receiving Medicare, will be phased out beginning July 1, 2022. In the meantime, older adults seeking to qualify for Medi-Cal benefits should consult with an experienced California Medi-Cal planning attorney about the program’s eligibility requirements and its continuing income limitations.

Medi-Cal can be an essential resource, and it’s crucial that you plan for program eligibility ahead of time. The best way to help ensure that you have the advice and information you need to plan for Medi-Cal is by consulting with an experienced Medi-Cal planning attorney. Your Medi-Cal attorney can explain the Medi-Cal program requirements and help you determine how to prepare for your present and future needs.

At the Law Offices of Alice A. Salvo, we are experienced California Medi-Cal attorneys who can help you evaluate your situation and avoid common Medi-Cal asset transfer mistakes. Contact us today to schedule your free consultation. https://www.salvolaw.com

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