As people live longer, their need for medical care grows. Unfortunately, the healthcare system can be challenging to navigate. Receiving high-quality care through MediCal (the California version of Medicaid) should not force senior citizens to choose between receiving quality care and abandoning the assets they worked for during their careers.
By creating and properly funding a trust, you may be able to qualify for MediCal without losing the assets you have worked hard to earn. A knowledgeable trust attorney can ensure this arrangement is in your best interest as well as offer guidance on your next steps. Let a San Luis Obispo Medicaid trusts lawyer help you develop a plan for your future.
The Basics of Medi-Cal Trusts
A Medicaid trust—known as a Medi-Cal asset protection trust—is a type of estate planning tool that can protect someone’s assets while allowing them to retain eligibility for Medi-Cal coverage. The purpose of this trust is to hold valuable assets so that they cannot be taken by the government to pay for the cost of medical care. When assets are placed in an irrevocable trust, they can potentially fall outside of assets of the trust creator – for Medicaid asset calculation purposes. This means these assets are excluded from any attempt by the government to recoup medical costs after the creator has passed away.
While a Medicaid trust can protect the creator’s assets, it can also continue to serve their needs. A San Luis Obispo attorney can assist with developing a Medicaid trust plan tailored to a person’s needs and goals.
Benefits of Medicaid Trusts
There are many reasons to consider creating a trust. A San Luis Obispo attorney can explain the benefits of a Medicaid trust, including:
Avoiding Medi-Cal Recovery
The major downside of relying on Medi-Cal is that California will attempt to collect the cost of a person’s medical bills from their estate after their death. Without a trust in place, the significant cost of medical bills can lead to the state receiving a significant amount of a person’s estate. Placing these important assets in a trust helps ensure the creator avoids this outcome and leaves assets to their heirs
Protecting Assets for Beneficiaries
Medi-Cal trusts can also protect the assets of a trust creator, and their beneficiaries from future government collection efforts, such as foreclosure or wage garnishment. A legal professional can help someone develop a trust that serves current needs—like healthcare—while designing plans to protect beneficiaries in the future.
The Removal of Asset Testing
On January 1, 2024, California became the first state to drop asset testing for access to Medicaid benefits. Applicants no longer have to prove a specific level of assets to qualify for Medi-Cal benefits. Instead, Medi-Cal qualification is focused solely on meeting specific income levels. This change grants any income-eligible person access to benefits such as the Medicare Savings Program and long-term care.
This expansion follows additional changes implemented in 2022. That year, the allowable assets increased from $2,000 for individuals and $3,000 for couples increased to $130 and $195,000, respectively. An attorney familiar with these changes and the provisions of Medi-Cal can offer more information about how these changes may affect a San Luis Obispo resident’s eligibility for Medi-Cal, as well as how to address these changes in an estate plan.
Call a San Luis Obispo Medicaid Trusts Attorney Today
When you believe support from Medi-Cal may be necessary for you or a loved one in the future, you should start thinking about how to protect your assets as soon as possible. The right plan could allow you to access the healthcare you need while keeping your estate intact. Let a San Luis Obispo Medicaid trusts lawyer advise you on how best to protect yourself and your beneficiaries moving forward. Call today to get started.
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