When you are planning ahead for retirement you may envision the opportunity to cross things off your bucket list. Good times lie in wait, and you have a retirement dream. You are probably not budgeting for long-term care, and Medi-Cal may be the last thing on your mind.
Why should someone who has saved for retirement care about Medi-Cal? People who have worked and paid taxes all of their lives are going to be qualified for Medicare when they become 65. You may think that if you qualify for Medicare that you will not need Medi-Cal, because Medi-Cal is for people who have no other access to health care insurance.
Medi-Cal is important for many people who are going to be qualified for Medicare because Medicare does not pay for an extended-stay in an assisted living facility. It will only pay for up to 100 days of convalescent care. Nursing home and assisted living community stays are considered to be custodial care. Custodial care is not covered by Medicare.
Most people are aware of the fact that Medi-Cal is in fact a need-based program. How does the program define need? This is done by the imposition of asset limits.
Medi-Cal Asset Limits
To qualify for the Medi-Cal program, your countable assets cannot exceed $2,000 in value. This can sound like an extraordinarily low figure, but some of the things that you own do not count when your eligibility is being determined.
If you have a wedding and/or engagement ring, these pieces of jewelry would not be counted. Heirloom jewelry would not be counted either. So if you inherited your mother’s wedding ring, this would not be a factor.
The vehicle that you use for transportation is not considered to be a countable asset by the Medi-Cal program. Household effects would not be counted either.
You will certainly be relieved to hear that your home does not count toward this $2,000 upper asset limit.
In many cases, one spouse will require long-term care while the other is still healthy enough to live independently. Under these circumstances, the healthy or community spouse may keep half of the couple’s community assets without impacting his or her spouse’s eligibility for benefits. There is however a limit. In 2013, the limit is $115,920.
The healthy spouse may also be entitled to what is called a Monthly Maintenance Needs Allowance. Program evaluators would determine how much it will cost the healthy spouse to maintain an acceptable quality of life. The healthy spouse may rely on some of the income that the institutionalized spouse is receiving to maintain this quality of life.
If these circumstances exist, the healthy spouse could receive an allowance carved out of the institutionalized spouse’s earnings of up to $2,898 per month.
To learn more about Medi-Cal and Medi-Cal Planning, we invite you to attend one of our free Medi-Cal Planning Workshops. We also invite you to request our free guide, the Consumer’s Guide to Medi-Cal Planning and Division of Assets.