Do I have to sell my home to go on Medi-Cal and will they take it after I die?

We receive calls from people asking us if they need to sell their home in order to qualify for Medi-Cal. They also ask us if the State will take their home after they die, if they have been on Medi-Cal.

Your home is generally an exempt asset for qualification for Medi-Cal. You confirm to Medi-Cal that you have an intent to return home, even if you have to go to a nursing facility for an extended period of time. At the present time, a home of any value is exempt for Medi-Cal qualification. Under the Deficit Reduction Act (DRA), which is not effective yet in California, there may be a qualification that a home cannot have more than $750,000 equitable value. But the DRA is not law yet, and to date, we do not have final language in this regard.

However, if the home is in your estate at the time of your death, it is subject to an estate lien for recoupment by the State. The State can claim against your estate, the amount of Medi-Cal benefits paid to the Medi-Cal recipient, but only up to the value of the estate. There are legitimate ways to protect the home from a State lien however, such as removing it from your estate before you die. The planning techniques in this regard this should be accomplished through an elder law attorney, in that there are potential tax issues to be dealt with.

If the deceased Medi-Cal recipient has a surviving spouse, minor, blind or disabled child, the State cannot pursue a lien. A home in joint tenancy between the surviving spouse and her children, does not provide protection against a State lien. As an aside, the State cannot recover against qualified accounts, such as IRAs, or term life insurance policies.

This blog is for informational purposes only and is not legal advice. You should consult an elder law attorney for your particular case, and before you proceed with any planning.

Written Michael J. Young, elder law attorney in Walnut Creek, CA. 1931 San Miguel Dr., Suite 220, Walnut Creek, CA 94596. 925-256-0298. Mr. Young serves Contra Costa and Alameda Counties, including the cities of Walnut Creek, Alamo, Danville, Concord, Brentwood, Pleasant Hill, Antioch, Clayton, etc.

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