You may think that, because you are pretty healthy now, you won’t need long-term care in the future. Hopefully, you are right. But what if you aren’t? Although you may not have any health issues right now, you cannot predict how healthy you will be in 30 or 40 years. More than two-thirds of people over the age of 65 need long-term care at some point in their lives. The reality is, healthy people need Medi-Cal planning, too.
Why you may need long-term care, even if you are healthy now.
What many people fail to consider is the fact that illness is not the only reason people need long-term care. Also, long-term care is not just providing medical treatment. For example, if you suffer a catastrophic injury following an automobile accident, you will likely need long-term care. In some cases, loved ones are admitted to nursing homes because of the need for daily assistance with activities such as dressing and grooming.
Health insurance may not cover the costs of long-term care
Regrettably, many people underestimate the real cost of long-term care. Long-term care is often very expensive. The average annual cost of long-term care in California is $94,900. Then consider that almost half of people 65 and older need long-term care of close to five years. Then consider the fact that many of those people have already been struggling with the cost of care in their own homes, before they seek a long-term care facility. It is a misconception that Medicare and private health insurance are sufficient to cover the costs of long-term care. The reality is, they typically cover very little of the costs.
How is Medi-Cal planning beneficial?
Medi-Cal benefits are meant to help low-income individuals pay for medical services. Because Medi-Cal is a needs-based benefits program, to be eligible, you must have no more than $2,000 in assets. Even though certain assets, like your home, are excluded, it is still very easy to deplete your savings before Medi-Cal will begin covering your long-term care expenses. However, the goal of Medi-Cal planning is to keep you from exhausting all of your resources, while still being eligible for benefits.
Medi-Cal planning also helps to avoid fraud
Contrary to what some people think, you are not allowed to transfer your assets to someone else, in order to reduce your assets and qualify for Medi-Cal. Medi-Cal is a “payer of last resort.” That means Medi-Cal does not start paying for long-term care until all other payment sources have been exhausted. Therefore, if an applicant for Medi-Cal gives away property or assets just before applying, those property transfers may result in your benefits being delayed or denied. But, with careful Medi-Cal planning, you can still maintain control of your assets while qualifying for Medi-Cal benefits, when necessary.
If you have questions regarding Medi-Cal benefits, or any other Medi-Cal planning needs, please contact the Schomer Law Group either online or by calling us at (301) 337-7696.