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Schomer Law Group, Los Angeles Estate Planning and Elder Law and Elder Law Attorneys

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Home » Services » Medi-Cal Planning – Planning to Get Approved

Medi-Cal Planning – Planning to Get Approved

Are you prepared to cover the expenses of long-term health care (LTC) if you need nursing home, assisted living or regular at home care down the road? If you are like many seniors, you will turn to Medi-Cal for help with your LTC costs. While Medi-Cal will cover LTC expenses, getting approved can be challenging. The old adage is that “if you fail to plan, you may as well plan to fail.” Your failure to plan could put your hard-earned assets at risk. Even worse, if you try to conceal those assets, you could face serious legal consequences even prison for Medi-Cal fraud. The good news is that Medi-Cal planning – through proper planning – can help.

Medi-Cal May Be Your Only Hope for Help

The older population in the United States is growing at an unprecedented rate. In fact, by the year 2050, experts tell us that the older population (age 65 and older) in the U.S. will outnumber their younger counterparts (age 21 and younger) for the first time in history. As the average life expectancy steadily increases, it also means there will be a dramatic increase in the need for long-term care (LTC) in the U.S. – and the cost of that care will be high. By 2036, experts tell us that the average cost of LTC across the United States will be over $166,250.00 a year per person receiving such care.

With an average length of stay of 2.5 years, that puts the average future LTC bill at almost $400,000. While most seniors can count on Medicare to cover the majority of their healthcare-related expenses, Medicare will not cover LTC costs except under very limited circumstances, and even then only for a short period of time. Most basic health insurance plans also exclude LTC expenses unless you purchased a LTC rider at an additional cost. For over half of all seniors in LTC, that leaves Medi-Cal, a needs tested program, as the only hope for help.

Qualifying for Medi-Cal

While Medi-Cald oes cover LTC costs, you must first qualify for benefits. Because Medi-Cal is intended to help low income applicants, the program imposes a “countable resources” limit that applicants cannot exceed and may impose an income limit. The income limit is tied to the Federal Poverty Level (FPL) in the geographic area where an applicant lives and changes each year. For seniors on a fixed income, even if the state has an income limit that is not generally where the problem lies. The problem applicants often face is the very low “countable resources” limit. In many states, the limit is as low as $2,000 for an individual applicant. Unfortunately, this can lead applicants to try to conceal resources.

The Wrong Way to Approach Medi-Cal Planning

Medi-Cal uses a five-year look-back period that effectively penalizes any asset transfers made by an applicant for less than fair market value during the five-year period prior to applying for benefits. Knowing this, some applicants try to hide assets when applying for Medi-Cal. Take, for example, the case of Stephen Gossman. Gossman applied for Medi-Cal (California’s Medi-Cal program) for his grandmother.

On the application he stated that his grandmother had no money when, in fact she had $220,000 from poker winnings and another $115,000 from the sale of her Los Angeles residence in cash hidden in her home. Medi-Cal paid $116,000 in expenses for her San Diego County nursing home. Gossman made the mistake of taking his grandmother’s unreported money and using it for a down payment on his home and then depositing the remainder in small amounts to avoid bank transaction reporting requirements. Medi-Cal eventually found out about the money. As a result, Gossman was charged with 17 counts of money laundering and health care fraud for which he was sentenced to almost four years in prison, fined $315,000, and ordered to reimburse Medi-Cal the $116,000 it paid for his grandmother’s nursing home expenses. Even if you aren’t concealing assets there are other ineffective ways to plan.

The Right Way to Approach Medi-Cal Planning

Probably the saddest part of Gossman’s story is that his attempt to hide his grandmother’s money was not necessary. Gossman’s grandmother could have been approved for Medi-Cal without losing her money by using legitimate Medi-Cal planning strategies. Although the rules vary by state, all states exempt certain assets from an applicant’s “countable resources.” A primary residence, for example is almost always exempt as is income producing property. The Gossmans could have used the cash to purchase a home, or other exempt assets, thereby converting non-exempt assets into exempt assets.

The key to protecting the assets you have spent a lifetime accumulating, and still qualifying for Medi-Cal if you need it, is proper Medi-Cal planning. The rules for Medi-Cal eligibility vary by state; however, in every state, the earlier you incorporate Medi-Cal planning into your comprehensive estate plan, the better off you will be when the time comes to apply for benefits. Consult with a Medi-Cal planning attorney in your area to find out how you can protect your hard-earned assets in the event you need to pay for long-term care down the road.

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Client Review
July 29, 2020
    

We need to update our Living Trust and attended Schomer Law Group’s seminar. Afterwards we made an appointment and were impressed by the attention Scott Schomer and Liran Aliav gave to our case answering all questions and making suggestions how to minimize the estate tax. All the office staff is very friendly and we highly recommend Schomer Law Group.

Frank & Jutta R
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July 29, 2020
    

Mr. Schomer does an amazing job at explaining all the intricacies of establishing a trust. He and his team help you every step of the way so you always know what to expect and what you are preparing for. Best education you can get and the best gift you can give your family.

Paula M.
Client Review
July 29, 2020
    

We put off getting a trust for years. After attending a seminar with Scott Schomer we realized that the time had come to get a trust. We were given very good reasons for why we should get a trust. No pressure, just the plain facts. We are very relieved and happy to finally get our trust. Scott and Cesar were very knowledgeable, helpful and listened to our ideas of what we had to say. Any questions that we have now and in the future they are available to assist us to solve them. I recommend the Schomer Law Group and I wish we knew about them years ago.

Phillip G.
Client Review
July 29, 2020
    

When you’re presented with an invitation to attend in a mailer, you may have reservations, this was a truly gift!! My wife and I were educated and guided through the process of creating a family trust.
Both of our parents had attorney’s that “worked” with wills/trusts, but came up short. Fortunately, the Schomer Law Group was there! This is a group of attorney’s that only specialize in estate planning, law, and financial advice, so you know you’re getting expert and personalized advice. This is the best money we’ve ever spent!! Thank you!

Bob L.
Client Review
July 29, 2020
    

We knew we had to update our 10 year old ( 20 page ) trust. After several detailed meetings, Liran and Cesar produced a large ( 300 pages + ) highly detailed trust document that we have used to make sure our family estate is well managed and clearly understood.
They were all very helpful in answering myriad questions and explaining all the various options…

We would strongly recommend the Schomer Law Group to anyone with an estate of even modest means, to assure proper planning…

Bob S.
Client Review
July 29, 2020
    

We had contemplated updating our will and starting a trust for a number of years. After attending a talk by Scott Schomer we realized we were long overdue and the potential downside of not having our affairs in order was significant. Scott and his excellent team made the process simple and seamless. They were great listeners, addressed all our concerns and even pulled and processed all the paperwork from our financial institutions. If you are looking for assistance with estate planning, wills and trusts, we highly recommend Schomer Law Group.

Robert F.
Client Review
July 29, 2020
    

Very competent & informative – friendly atmosphere – ready to answer the most mundane questions – relaxed.

Joan S.
Client Review
July 29, 2020
    

Mr. Schomer was excellent in getting our family trust and estate affairs in order. My husband and I had put off doing this and Scott really made the process easy! He is very passionate in making sure his clients get all that they need and we really appreciated it. I would highly recommend him and look forward to the many years he will be available to assist our family.

Kim

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