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Updated California Law Limits Medi-Cal Estate Recovery

Mar 3, 2017

San Francisco, CA (Law Firm Newswire) March 3, 2017 – Last year, Gov. Jerry Brown approved legislation, which limits California’s estate recovery from low-income Medi-Cal recipients who are aged 55 to 64.

The 2016-17 budget includes $30 million to curb the seizure of assets only to what is required under federal law, which is the cost of long-term care in nursing homes. The state previously sought repayment for virtually all Medi-Cal costs paid on the deceased person’s behalf.

“The change in the law ensures individuals who go on Medi-Cal are no longer forced to choose between health care and being able to pass their assets and homes on to their heirs,” said nationally known estate planning attorney Michael Gilfix. “There is no longer a fear of losing everything to the state.”

As of January 1, 2017, California only recovers the cost of a Medi-Cal recipient’s long-term care services and related costs after their death. The new legislation prohibits estate recovery for a deceased Medi-Cal enrollee who is survived by a registered domestic partner or spouse. It also exempts estate recovery for homes of modest value. The California Department of Finance classifies such homes as those having a 50 percent or less fair market value than the average house prices in the same county.

Until now, California had decided to engage in optional estate recovery to recoup all Medi-Cal costs in addition to those required by federal law. As a result, recipients of the state health care program risked losing their homes and other assets upon their death. Other government health programs such as Social Security, Medicare or Covered California do not require such seizure of assets.

“Many people do not realize that the process of protecting your assets for Medi-Cal can be quite complex,” said Gilfix. “An experienced estate planning attorney can help develop a proper estate plan that ensures one’s assets end up in the intended, rightful hands.”

Gilfix & La Poll Associates LLP
2300 Geng Rd., Suite 200
Palo Alto, CA 94303
Telephone: (650) 493-8070

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