New Budget Law Brings Changes to Medi-Cal Estate Recovery

The new state budget bill for the next fiscal year has been passed by Governor Jerry Brown, bringing good news for Medi-Cal recipients. As a part of the new legislation, substantial changes are incoming to the Medi-Cal estate recovery program which will afford several benefits to the families and spouses of Medi-Cal beneficiaries.

For those who are unaware, the Medi-Cal estate recovery program allows the California Department of Health Care Services (DHCS) to assert a claim against assets owned by a Medi-Cal recipient upon his or her death for the amount of money Medi-Cal spent on the beneficiary’s nursing home residency or other benefits. While this basic premise has not changed, the new bill makes it so no estate claims will be made against the estates of surviving spouses for beneficiaries who pass away on or after January 1st, 2017. Additionally, estate claims will now only be asserted on claims which are subject to probate. In other words, any property held in revocable living trusts or joint tenancies will not be exempted from DHCS estate claims, with recoveries being limited only to what is required under federal law.

What Does This Mean?

These revisions mark the most significant changes to Medi-Cal rules since 1990’s Medicare Catastrophic Coverage Act. While California has been one of the most generous states in the nation in terms of allowing poor and middle-class families to qualify for benefits, it also has had some of the most aggressive estate recovery rules. Now, these changes will allow more Medi-Cal recipients to leave an inheritance to their surviving children and families without the financial pressure of having to pay back the state after their death. Now families will no longer be forced to choose between receiving health care under Medi-Cal and surrendering their life savings.

If you are a Medi-Cal recipient and are unsure if you are subject to estate recovery, contact the knowledgeable Los Angeles trust attorney at the Law Offices of David A. Shapiro, P.C. today. As a Board Certified Specialist in trust and probate law, our founding Attorney David A. Shapiro can provide the steadfast legal guidance you need to protect your assets for your family.

Schedule your free case review online or call (310) 853-1554 today to review your legal options.

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