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Asset seizure by Medi-Cal might soon be limited

An important part of care planning for some people is to keep assets protected while still qualifying for assistance paying for long-term, end-of-life care. In California, people who receive Medi-Cal benefits are subjected to asset recovery once the covered person passes away. This is because of a federal law that has been in effect for more than 20 years.

Under the federal law, states are required to try to get reimbursement for assisted living care and nursing home care that is provided to people who are at least 55 years old and receiving Medicaid benefits. That same federal law allows states to seek reimbursement for other medical care. California is one of 10 states that has opted to seek that extra reimbursement.

That, however, might soon change. A measure limiting the asset recovery in these cases is heading to the Assembly health committee. The issue at hand is that the recovery program recovers only a small portion of the payments made by Medi-Cal. In the past decade, only around $30 million has been recovered.

Opponents of the bill say that the asset recovery program is important because it shows that Medicaid isn't actually free. It puts some of the burden on the estate of decedents instead of on taxpayers.

The measure has already been approved by the Senate. If it passes, it would limit the amount that can be recovered only to the costs of assisted living care or nursing home care. There isn't any indication if Governor Jerry Brown would sign the bill yet.

Care planning is an important tool for estate plans. Learning how to protect your assets can give you peace of mind if you end up needing nursing home care or assisted living care under Medicaid.

Source: 89.3 KPCC, "Bill seeks to limit California's Medi-Cal asset recovery," Stephanie O'Neil, July 06, 2015

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