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"How to get Medi-Cal coverage for your nursing home care... without selling your home or leaving your family without a dime... Surprising ways to pay for your assisted living and long term care costs."

Elder Law Today Newsletter | Vol. 28 | June, 2008


Medi-Cal and the Deficit Reduction Act - And - Rosie the Riveter

Medi-Cal and the Deficit Reduction Act: The President signed the federal Deficit Reduction Act (DRA) on February 8, 2006. Under this new act, the Medicaid rules were changed dramatically, and not to the benefit of our older clients. The States are required to adopt certain portions of the new rules. In California, Medicaid is known as Medi-Cal, and the new rules have not to date been adopted.

In an elder law conference I just attended, we were informed that the new California legislation adopting new Medi-Cal rules, will probably not come into effect until some time during 2009. As a result, we have at least the rest of 2008 to do our planning under the old, more beneficial rules.

Under the present rules, gifting is allowed to lower the asset value of the Medi-Cal applicant, to allow for qualification. The rules provide for a 30 month look back period from the date of application. Medi-Cal uses a divisor, called the average private pay rate, (APPR), which is $5,496. So, for example, if our client transfers $11,000 to his son in January 2008, and applies for Medi-Cal, the 30 month look back period is triggered. The $11,000 is divided by $5,496, creating ineligibility for 2.1 months, which is rounded down to two months. As a result, our client would not be eligible for January and February, but would be for March.

Under the new rules, there is a 60 month look back period. In addition, the months of ineligibility will begin from the point the Medi-Cal application is made, and not from the point the gift is made.

As a result, we encourage our clients to do their planning sooner than later. We have been told that California will not make newly adopted Medi-Cal rules retroactive, but there is no guarantee of this.

Rosie the Riveter: The stories in the ELT newsletters are printed with permission of our clients, and sometimes poetic license is used in the stories. In interviewing a couple recently, the husband told me that he was in the Navy during WWII. His wife told me that during the war years, she was not in the military. She asked me if I had heard of Rosie the Riveter, and she told me that was her! She said that during the war years, she worked for Lockheed Aircraft Co. in Burbank, CA. She apologized though that she was not really a riveter, but instead assembled electrical systems for aircraft. She told me that she enjoyed the work, and was proud of being part of the war effort. Her biggest satisfaction though, was that she had learned a trade, like a man, and made enough money to be independent of her family. When the war was over though, she was very disappointed to lose her job, but she said she understood that the men returning from service would get their jobs back.

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