Estate Protection Legislation for Medi-Cal

Historically, Medi-Cal recipients are required to pay back Medi-Cal from their estate once they have passed away.  In the case of a married couple, the pay back could be deferred until the death of the second spouse.  This has created new problems under the Affordable Care Act, which expands Medicaid coverage (called “Medi-Cal” in California).

SB1124 seeks to correct potential expanded Estate liability by limiting recovery to only what is required under Federal law, which is the cost of long term care in nursing homes.  Currently California seeks a recovery for a much broader array of Medi-Cal services and thus has a larger potential lien against the family’s estate.

While SB1124 seems like a common sense solution that is fair, Governor Brown is opposed to the proposal.  Understandably, California wants as much money “recovered” as possible because the State has seen some tough years with large budget deficits.  However, California is currently only one of 10 states with such aggressive collection policies that go beyond what federal law requires.  Making California’s estate recovery policy line up with federal law will makes sense and will protect and preserve the assets of an estate to pass more to their heirs.  Remember, this sort of recovery applies only to middle and lower income households who may own a home (which is an exempt asset for eligibility for Medi-Cal).  Wealthier families typically have private insurance options or simply pay out-of-pocket for long term care.  We should follow this legislation closely and let the governor know that this is a good bill for California’s middle class.