Are There Any Penalties From Medi-Cal For Transferring Assets?
There are penalties from Medi-Cal on eligibility for transferring assets. They’re looking for transfers which exceed California’s average private pay rate. That’s a certain dollar amount, set by the state each year. It’s around $8,400 per month. If you transfer more than that $8,400 to any one person at a time when you could have paid for a month in a nursing home, the state will assess a one-month penalty. You’re not eligible for one month. The secret is knowing how to transfer assets while avoiding any penalty period.
The way the penalty period and transfers work is that, first of all, there’s no partial ineligibility. You’re either eligible for all of a month or none of that month. Also, any penalties that might be incurred run concurrently and not consecutively, meaning that if I have three kids and I give away a bunch of money to each one of them, each gift might incur its own transfer penalty. However, they’re going to begin at the same time if I transfer them on the same day.
You can separate transfers. If you give each of your three children $8,000, you’ve moved $24,000 but because each transfer was below $8,400, there’s no transfer penalty. You can move $1,000 to a different beneficiary every day until you get rid of all of your money. Once all of the money is gone, then you’re able to qualify for Medi-Cal and incur zero transfer penalties because not one transfer exceeded $8,400 and all of the transfers were done to different people, on different days. You can move lots of money over a relatively short period of time and not incur any transfer penalty for those transfers.
California is the last state in the country to have this type of liberal transfer rule. It will go away some day and California will adopt the federal rules. I don’t know when that will happen but until then, people can transfer hundreds of thousands of dollars in a month or two and then become eligible for Medi-Cal. No one should have to spend down their money in California. We do very safe, restricted transfers to protect people’s assets.
Is Medi-Cal Planning The Same As Asset Protection?
Medi-Cal planning is very similar to asset protection but the goal is different. Medi-Cal planning takes place so that you can qualify for public assistance and not have to lose all of your assets to acquire the medical care you need.
For more information on Medi-Cal Penalties For Asset Transfers, a free initial consultation is your next best step. Get the information and legal answers you are seeking by calling (916) 674-2066 today.
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