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Medi-Cal
allows you to spend down your assets. In California you can
pay off bills, reduce debts, buy new clothing, a television,
wheelchairs, walkers, put a new roof on your home or even
go on vacation.
The objective of spending down is to reduce your assets to
California's established asset limits in order to qualify
for Medi-Cal. In many cases, families may end up disposing
of what they have worked hard all of their lives to accumulate,
spending frivolously, or leaving a spouse or family member
with relatively little saving on which to live.
Learning
what assets are counted for eligibility in California and
examining California's eligibility requirements and other
long-term care funding options will allow you to make informed
choices that can help preserve your assets and protect your
family's future.
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Individuals- The principal residence is not counted
as long as you specify on the Medi-Cal application that you intend
to return home when your health improves.
Married Couples- The principal residence is not counted if your
spouse still lives there.
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One
car of any value if owned by the spouse. |
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Household
goods and personal effects of any value. |
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Prepaid
burial plots of any value. |
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A
whole life insurance policy with total face value (cash value)
of $1,500 or less. |
In
addition to this list, an annuity that is properly annuitized can
be considered an unavailable asset and not “counted” as
an asset in determining Medi-Cal eligibility.
Annuitizing an annuity can convert countable assets by simply
exchanging premium dollars for irrevocable income payments.
If the payments are made to the person entering the nursing home,
the income generated by the annuity will be counted as income and
required to be used to pay for the cost of care.
Transferring Assets- The Myth
Many people are under the misconception they can simply give assets
away to qualify for Medi-Cal. It sounds like an easy solution. However,
a transfer of assets made prior to applying for Medi-Cal may create
a penalty period of ineligibility. The rules on penalties are complicated
and vary greatly.
For more information about services provided
by the experts at Linker Financial Group, Inc. or to schedule a
brief, no charge, no obligation consultation to see if Medi-Cal
Long Term Care planning is right for you, please give us a call
or send us an e-mail right now.
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