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Covered California and Obamacare related questions from consumers, employers and agents are answered by Phil Daigle with the best information available at the time. Archived entries may no longer be accurate as the Covered California and Obamacare knowledge-base is evolving quickly. TO REQUEST A PERSONAL RESPONSE INCLUDE EMAIL ADDRESS.

Medi-Cal Asset Recovery Change?

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Question: I read that California now limits what Medi-Cal can recover from beneficiaries estates?

Answer: Like the majority of Californians, I have long opposed California’s right to the seizure of assets, after death, of people who had received health insurance coverage through the state’s Medi-Cal program. While seldom enforced, it was a cloud over California’s 11 million Medi-Cal beneficiaries. Now, California’s $122 billion general fund budget includes money to dramatically limit the practice to recover money only for nursing home care.


Limits On Medi-Cal Recovery Program Will Cost State Nearly $60M A Year

By Tom Kisken of the Ventura County Star

A little-known federal law allowed the state of California to claim $1.3 million in the 2014-15 fiscal year from the estates of deceased, low-income Ventura County residents who were covered by Medi-Cal.

The money will likely shrink dramatically next year because of limits added to a state budget expected to be signed by Gov. Jerry Brown no later than Monday.

Called estate recovery claims, the program is designed to help cover the state’s Medi-Cal costs and is aimed, with some exceptions, at benefits paid for people 55 and older. Advocates of the elderly praise the planned budget restrictions as long overdue, characterizing the status quo as springing surprise penalties on the poor.

“We have people who have been paying the state back for 10 years now,” said Patricia McGinnis, executive director of California Advocates for Nursing Home Reform, referring to plans set up when people decide they can’t sell a family member’s home.

The federal government requires states to recoup money spent to provide nursing home care through Medicaid programs like California’s Medi-Cal. California is one of a handful of states that has also used the federal option to make claims on assets including homes and vehicles for general medical care provided by Medi-Cal to people 55 and older.

The claims are made only on the assets of Medi-Cal members who have died. If they have no assets, no claims are made.

Across the state, $1.1 billion has been claimed from estates in California since the program started in 1993. About $68 million was claimed in the 2014-15 fiscal year. Mushrooming Medi-Cal enrollment would have pushed that number far higher if not for the planned budget restriction.

Of the $1.3 million claimed in Ventura County, officials say they don’t know how much came from nursing home care in comparison to benefits for general medical treatment.

The distinction is important. In a move long sought by McGinnis and others, the state is set to end recovery efforts aimed at general medical care as of Jan. 1 pending the governor’s budget signing.

Claims for Medi-Cal benefits paid for services related to long-term care would continue, though restrictions would be added on what property can be claimed.

California Department of Finance officials estimate the budget change would decrease total claims by nearly $58 million a year.


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