As an estate planning attorney, I am sometimes asked to assist an elderly person meet his or her health care needs through public benefits. The rules and regulations regarding public benefits are very complicated and are forever changing. Therefore, I always refer persons seeking this type of assistance to an attorney who specializes in this area. I have found that the terminology alone can be confusing — “Medi” this and “Medi” that. For this reason, I thought it might be useful to share with you some general information concerning these programs.
“Medicare” is a program administered by the federal government. It is an employment-related, public insurance program that is neither need-based nor means-tested. It is linked to Social Security and provides benefits to wage earners who have qualified for the program by payroll tax contributions. Medicare Part A (Hospital Insurance) provides hospital benefits, limited post-hospital skilled nursing facility care, part-time home health services, and hospice care. Medicare Part B (Supplemental Medical Insurance) is a voluntary program of health insurance covering physicians’ services, certain outpatient services, home health care, diagnostic tests, and medical appliances. Though Medicare is an important program, it does not cover the health care many senior citizens have the most need for — long term nursing care.
“Medicaid” is a federal program that enables states to provide medical assistance to impoverished individuals. It is administered by the respective states and goes by different names, according to the state involved. In California, the program is called “Medi-Cal”.
An individual’s entitlement to Medi-Cal benefits depends on the financial resources available to him or her. Once an individual qualifies, however, the program will cover nearly all medical assistance, including long term nursing care. Given that nursing home costs range from $3,500 to $7,500 per month, it is for this reason that many people are concerned with obtaining Medi-Cal benefits. However, since the program is designed to assist only those who are truly impoverished, there are strict limits on the income and assets a person can have. Under Medi-Cal rules a person is not required to sell his or her residence to qualify for benefits but the State has a claim against the residence for reimbursement of benefits paid that attaches to the residence upon the recipient’s death. There are specific, narrow exemptions or limitations that apply to eliminate or reduce the right of reimbursement but most estates are impressed with the reimbursement requirement.
I frequently encounter Medi-Cal liens when handling probates. In fact, the probate court requires a verified statement regarding whether or not the deceased person was a Medi-Cal recipient and if so will require that Medi-Cal be reimbursed before distribution to heirs can be made. If the estate is distributed without notifying the state or giving the state an opportunity to seek reimbursement, the state can make a claim directly against the heirs of the deceased person that received the property in question!
If the prospect of long term nursing care is a concern, insurance to provide such benefits should be obtained. If the need is imminent, you should seek the counsel of an attorney that specializes in that area of the law. © 2013 by Marlene S. Cooper. All rights reserved.