One of the primary goals of Los Angeles Medi-Cal planning is to decrease the economic impact that long-term care will have, as the cost of long-term care is typically very expensive. For some the cost can be catastrophic. Considering all of this, some people ask whether it is illegal or unethical to help clients to protect their assets through Los Angeles Medi-Cal planning.
Are people really concerned about Los Angeles Medi-Cal planning?
Elder law attorneys can be concerned about the public image connected to Medi-Cal planning because many are accusing of “working the system” for the benefit of overprivileged elderly clients. However, in some cases critics of Medi-Cal planning are simply trying to advance their own interests. Those who want to protect the interest of the long-term care insurance carriers would logically seek to discredit Medi-Cal planning. Los Angeles Medi-Cal planning, when done the proper way, can make the need for long-term care insurance obsolete.
What is Medi-Cal?
Medi-Cal, California’s state Medicaid program, is funded by both federal and state funds. There are several different methods for obtaining eligibility for Medi-Cal. There are also eligibility rules specifically for long-term care services like nursing homes, assisted living facilities, and home health care services. The California Department of Health Care Services (DHCS) administers long-term care programs in California.
Why do some people complain about Medi-Cal Planning?
Some people believe that Medi-Cal coverage is meant for the poor and not for people who are capable of hiring an attorney to help them protect their assets. Some also believe that Medicaid, in general, will bankrupt the system. Another common concern is that Medi-Cal planning will result in a two-tiered long-term care system where poor people are forced to stay in Medi-Cal nursing homes where they will receive inferior care. Wealthy people, on the other hand, will be able to pay for private long-term care.
Why you should plan for long-term care
What many people don’t think about is the fact that the need for long-term care is not only brought about because of illness. Nor does it only provide medical treatment. You could suffer a catastrophic injury as the result of a car accident which could mean you will need long-term care of some type. Some people need long-term care simply because they need assistance with their daily activities, like grooming and dressing.
Health insurance does not always cover long-term care expenses
It is unfortunate, but some people miscalculate the real cost of long-term care, which is usually very expensive. The average annual cost of long-term care in California is close to $100,000. Consider also that nearly half of people 65 and older need long-term care for close to five years. Many people have the mistaken impression that Medicare and private health insurance are sufficient to cover the expense of long-term care. In reality, these financial resources very rarely cover those costs.
How can Medicaid planning help you be prepared?
Medicaid benefits are meant to help low-income individuals pay for medical services. Because Medicaid 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 Medicaid will begin covering your long-term care expenses. However, the goal of Medicaid planning is to keep you from exhausting all of your resources, while still being eligible for benefits.
Medicaid 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 Medicaid. Medicaid is a “payer of last resort.” That means Medicaid does not start paying for long-term care until all other payment sources have been exhausted. Therefore, if an applicant for Medicaid gives away property or assets just before applying, those property transfers may result in your benefits being delayed or denied. But, with careful Medicaid planning, you can still maintain control of your assets while qualifying for Medicaid benefits, when necessary.
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