Medi-Cal or MediCare…or Both?

The Presidential debate has featured a lot on who stole what from Medicare and why.  However, as former President Clinton pointed out last night in his speech during the Democratic National Convention, many seniors and middle-class Americans qualify for Medicaid (Medi-Cal ) as well.  Additionally, as the former president asserted, much of the Medi-Cal benefits paid for seniors pay for medical costs, in-home care, and other health expenditures, all of which can get extremely expensive when long-term care needs are involved.  

Governor Romney and Representative Ryan have vowed to repeal the Affordable Care Act and protect Medicare.  However, according to Ryan’s original plan, they would also turn Medicaid into a block grant plan, which would shift the primary funding responsibilities to the states.  The grants would be tied to inflation, even though healthcare costs have outpaced inflation for many years.  However, the idea is that by shifting the responsibility to the states, greater efficiency will be achieved.

Former President Clinton said in his speech, “Lot of folks don’t know it, but nearly two-thirds of Medicaid is spent on nursing home care for Medicare seniors who are eligible for Medicaid….  And a lot of that money is also spent to help people with disabilities, including a lot of middle-class families whose kids have Down’s syndrome or autism or other severe conditions.”  As several states push against the Affordable Care Act, and even attempt to use the Supreme Court’s decision in National Federation of Independent Business, et. al v. Sebelius to eject current Medicaid recipients, California has been taking the lead on Medi-Cal expansion and implementing the law.

Currently, seniors and their families considering institutionalized care may be able to stay in their homes longer than they otherwise could.  California’s large In Home Supportive Services program, individuals who are eligible for Medi-Cal and eligible for IHSS services already, may be better able to receive benefits, thanks to the Community First Choice program, created by the state.  Furthermore, according to a recent article, California intends to claim benefits retroactive to the beginning of the year immediately.  This means seniors who are already qualified may see some of their costs reimbursed under the Affordable Care Act.

Often seniors prefer to keep, and stay in, their own homes for as long as possible.  For many, the thought of institutionalized care is nerve-racking and difficult to deal with.  However, with increased accessibility to home-based health services many seniors can keep their autonomy and independence longer than they otherwise may.  Additionally, proper Medi-Cal planning can maintain the ability to keep a home, while maintaining flexibility in tax and long-term care planning.

If you or your parent has been considering a nursing home or skilled nursing facility, but aren’t ready to give up the family home, a QMap trust allows greater ease in selling the home if it becomes necessary after incapacity while preserving the income tax benefits of a primary home sale.  Additionally, a QMap Trust will help prevent Medi-Cal recovery against the estate, if necessary.  With proper planning, all the advantages of Medi-Cal can be gained, without suffering all of the drawbacks.  California has committed to some form of Affordable Care Act implementation, even if it is ultimately repealed by the next administration; however, planning for imminent issues and reviewing the plan regularly is always your best bet!

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