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MEDI-CAL & YOUR HOME

Can I Transfer my home if I am on Medi-Cal?

Yes, under federal law, title to the principal residence may be transferred to the following persons at any time without affecting Medi-Cal eligibility:

  • a spouse;

  • a son or daughter under age 21 or who is blind or permanently disabled;

  • a sibling who has equity in the home and who was residing there for at least one year immediately prior to the individual’s admission to a nursing home;

  • a son or daughter who was living there for at least two years immediately prior to the individual’s admission to a nursing home and who provided care which enabled the parent to live at home;

to anyone, so long as the home was exempt at the time of transfer.

If you decide to transfer your home, we strongly suggest that you consult with an attorney experienced in Estate Planning for Long Term Care before any transfer is made. Transferring your home may have tax implications.

California Code of Regulations

22 CCR § 50961

§ 50961. Estate Claims.

 

(a) The Department shall claim against the estate of a decedent, or against any recipient of the decedent's property by distribution or survival, an amount equal to the lesser of:

(1) All payments made by the Medi-Cal program on behalf of the decedent, except for those payments specified under subsection (c) that are not included in the claim; or,

(2) The decedent's equity interest in the property at the time of death (to the extent of such interest).

 

(b) All payments made by the Medi-Cal program on behalf of decedents:

(1) Age 65 and older, who died prior to July 11, 1994, shall include all payments made for services provided at age 65 and older;

(2) Age 65 and older, who died on or after July 11, 1994, shall include all payments made from age 65 and older, in addition to any payments made from age 55 to 64 that were paid on or after October 1, 1993;

(3) Age 55 to 64, who died on or after July 11, 1994, shall include only those payments made on or after October 1, 1993.

 

(c) The Department's claim shall include all payments made by the Medi-Cal program on behalf of the decedent, including nursing facility and other long-term care services, home and community based services, inpatient/outpatient services, durable medical equipment, related hospital and prescription drug services, health care and insurance premiums, and payments to managed care plans. The Department's claim shall not include payments made for personal care services provided under In-Home Supportive Services, or the cost of premiums, co-payments, and deductibles paid on behalf of Qualified Medicare Beneficiaries (QMBs), Specified Low-Income Medicare Beneficiaries (SLMBs), Qualifying Individuals, Qualified Disabled and Working Individuals, QMB Plus, and SLMB Plus who are categorized as groups of dual eligibles as defined by Section 2602(f) of the Patient Protection and Affordable Care Act of 2010 (Pub. L. No. 111-148).

 

(d) An exemption from the Department's claim exists in any of the following circumstances:

 

(1) Where the decedent was under age 55 when the Medi-Cal services, as specified in subsection (c), were received, except if the individual is/was an inpatient in a nursing facility, intermediate care facility for individuals with intellectual disabilities, or other medical institution, and both of the following conditions are met:

 

(A) The provisions under Title 22, California Code of Regulations, Section 50428 apply to the individual; and

(B) The individual spends for costs of medical care all but a minimal amount of his/her income required for personal needs.

 

(2) During the lifetime of a surviving spouse, after the documentation specified in paragraphs (A) and (B), below, is submitted to, and approved by, the Department at the address specified in Section 50966(a). However, upon the death of the surviving spouse, the Department shall assert its claim against the estate of the surviving spouse, in accordance with subsections (a), (b) and (c) of this section.

(A) Proof that the surviving spouse was married to the decedent at the time of death; and

(B) Proof of identity of the surviving spouse including name, social security number, and date of birth.

 

(3) During the lifetime of a surviving person, as specified in subsections (b) and (c) of Section 50963, who qualifies for a waiver due to a substantial hardship. However, upon the death of the surviving person, the Department shall assert its claim against the estate of the surviving person, in accordance with subsections (a), (b) and (c) of this section.

 

(4) When, as of the date of decedent's death, there is a surviving child of the decedent who is under age 21, and who can provide the Department with the documentary evidence specified in Section 50966(a)(2), to the address specified in Section 50966(a);

 

(5) When, as of the date of the Department's notice of claim, there is a surviving child of the decedent who is blind, or disabled, within the meaning of Section 1614 of the federal Social Security Act (42 USC Section 1382c), and who qualifies for a claim exemption under Section 50966.

 

(e) The Department shall waive the proportionate share of its claim against any applicant who qualifies for a waiver due to a substantial hardship, as specified in Section 50963(a).

 

(f) The Department shall not enforce collection of the proportionate share of its claim for any applicant who is awaiting the resolution of a hardship waiver request or an estate hearing. However, the Department shall enforce collection of its claim from the remaining dependent(s), heir(s), or survivor(s) for his or her proportionate share of the claim.

 

(g) The Department shall reduce its claim in accordance with Section 50453.7(b) for insurance benefits received under the California Partnership for Long-Term Care.

 

(h) The Department shall claim against annuities as part of a decedent's estate. The Department's claim shall be recovered from the value of an annuity, annuity payments, or distributions receivable by any person or entity from the date the annuity payments or distributions are designated to be made. The Department's claim shall apply to the annuity, annuity payments, or distributions regardless of the funding source for the annuity.

(i) Where the decedent made an irrevocable transfer of a remainder interest in property with a retained life estate, the Department's claim shall not apply against the life estate or the remainder interest. Where the decedent held a life estate and made a revocable transfer of the remainder interest in the property, the Department's claim shall apply to the fair market value of the property as if title to the property had remained solely with the decedent. Where the decedent made a revocable transfer of a remainder interest in property and made an irrevocable grant of a life estate in the property, the Department's claim shall apply to the fair market value of the remainder interest. Where the decedent made a revocable transfer of a remainder interest in property and made a revocable grant of a life estate in the property, the Department's claim shall apply to the fair market value of the property as if title to the property had remained solely with the decedent.

 

(j) The Department's claim shall not apply against property interests that the decedent irrevocably transferred before death.

 

(k) A voluntary post death lien shall be proposed, in accordance with Section 50965, to secure the unpaid portion of the Department's claim until the claim is paid in full.

 

(l) Except for claims governed by Probate Code Sections 9203 and 19203, the Department shall charge simple interest, at the rate of seven percent per annum, on the unpaid portion of its claim until the claim is fully satisfied.

(1) Where there has been no claim exemption sought pursuant to Section 50961(d) or a substantial hardship waiver requested in accordance with Section 50963, simple interest shall begin to accrue on the date of notice of claim or the date of distribution, whichever is later.

(2) Where a claim exemption has been sought pursuant to Section 50961(d) or a substantial hardship waiver has been requested in accordance with Section 50963, simple interest shall begin to accrue on the 15th day following the date of the final determination of the claim exemption or substantial hardship waiver request.

 

22 CCR § 50963

§ 50963. Substantial Hardship Criteria.

 

(a) The Department shall waive an applicant's proportionate share of the claim if the applicant can demonstrate through submission of an Application for Hardship Waiver, form DHCS 6195 (05/15) and documentation to substantiate hardship, or, if applicable, at an estate hearing, that enforcement of the Department's claim would result in substantial hardship to the applicant. In determining the existence of substantial hardship, the Department shall waive an applicant's proportionate share of the claim if one or more of the following criteria apply:

(1) When allowing the applicant to receive the inheritance from the estate would enable the applicant to discontinue eligibility for public assistance payments and/or medical assistance programs; or,

(2) When the estate property is part of an income-producing business, including a working farm or ranch, and recovery of medical assistance expenditures would result in the applicant losing his or her primary source of income; or,

(3) When an aged, blind, or disabled applicant has continuously lived in the decedent's home for at least one year prior to the decedent's death and continues to reside there, and is unable to obtain financing to repay the State. The applicant shall apply to obtain financing, for an amount not to exceed his or her proportionate share of the claim, from a financial institution as defined in Probate Code Section 40. The applicant shall provide the Department with a denial letter(s) from the financial institution; or,

(4) When the applicant provided care to the decedent for two or more years that prevented or delayed the decedent's admission to a medical or long-term care institution. The applicant must have resided in the decedent's home during the period care was provided and continue to reside in the decedent's home. The applicant must provide written medical substantiation from a licensed health care provider(s), which clearly indicates that the level and duration of care provided prevented or delayed the decedent from being placed in a medical or long-term care institution; or,

(5) When the applicant transferred the property to the decedent for no consideration; or,

(6) When equity in the real property is needed by the applicant to make the property habitable, or to acquire the necessities of life, such as food, clothing, shelter or medical care.

(b) A substantial hardship exists during the lifetime of a surviving registered domestic partner for domestic partnerships that were created in this state. The Department shall defer collection of the entire claim during the lifetime of a surviving registered domestic partner, after the documentation specified in paragraphs (1) and (2), below, is submitted to, and approved by, the Department at the address specified in Section 50966(a). However, upon the death of the surviving registered domestic partner, the Department shall assert its claim against the estate of the surviving registered domestic partner, in accordance with subsections (a), (b) and (c) of Section 50961.

(1) A copy of the Declaration of Domestic Partnership, filed with the Secretary of State; and

(2) Proof of identity of the surviving registered domestic partner including name, social security number, and date of birth.

(c) A substantial hardship exists during the lifetime of a surviving person of a legal union of two persons of the same sex, other than a marriage, that was validly formed in another jurisdiction and is recognized as a valid domestic partnership in this state pursuant to Family Code section 299.2. The Department shall defer collection of the entire claim during the lifetime of a surviving person of a legal union, after the documentation specified in paragraphs (1) and (2), below, is submitted to, and approved by, the Department at the address specified in Section 50966(a). However, upon the death of the surviving person of a legal union, the Department shall assert its claim against the estate of the surviving person of a legal union, in accordance with subsections (a), (b) and (c) of Section 50961.

(1) A copy of a filed document that is substantially equivalent to the Declaration of Domestic Partnership; and

(2) Proof of identity of the surviving person of a legal union including name, social security number, and date of birth.

(d) A substantial hardship shall not exist when the decedent or applicant created the hardship by using estate planning methods to divert or shelter assets in order to avoid estate recovery.

(e) To the extent that there currently is, or later becomes, any conflict between the preceding criteria and the standards that may be specified by the Secretary of the Department of Health and Human Services, the federal standards shall prevail.

(f) The Department shall provide written notification to the applicant of its decision regarding the hardship waiver application within 90 days of the submission of the application.

(g) If an application for hardship waiver is denied, the Department shall provide the applicant with notice of the right, the address, and the timeframe to request an estate hearing, at the time it provides notice of its decision.

(h) The Department shall issue its decision on an applicant's hardship waiver application prior to and independent of its consideration of a voluntary post death lien.

 

22 CCR § 50964

§ 50964. Estate Hearing.

 

(a) An applicant may challenge the Department's hardship waiver decision by requesting an estate hearing. The request must be in writing and mailed to the Director of the Department through his or her designee, the Office of Administrative Hearings and Appeals, within 60 days of the date of the Department's decision inscribed at the top of the Department's notice.

(1) The Department shall provide the applicant at least 30 days notice of the date, time and place of the hearing. The hearing shall be conducted within 60 days from the date of the request, and may be continued for good cause, such as illness, injury or incarceration of the applicant.

(2) For an in-state applicant the Department shall conduct the hearing within the California Court of Appeal district where the applicant resides. In the case of an out-of-state applicant, the hearing shall be conducted in Sacramento, California.

(3) At the estate hearing, the applicant and/or the applicant's representative shall have the opportunity to be heard, offer evidence, and present witnesses in support of the request for a waiver. All testimony shall be submitted under oath, affirmation, or penalty of perjury. The proceedings at the estate hearing shall be electronically recorded. The applicant and/or the applicant's representative shall be prepared to leave copies of all documents which support the applicant's request for a waiver with the hearing officer.

(b) The hearing shall be conducted in an impartial manner by a hearing officer appointed by the Director.

(c) A proposed decision, stating the applicable law, evidence and reasoning upon which the decision is based, shall be submitted to the Director no more than 30 days after the hearing record is closed. Within 30 days after the proposed decision is received by the Director, the Director may adopt the proposed decision, reject the proposed decision and have a decision prepared based upon the record, or refer the matter to the hearing officer to take additional evidence. If the Director takes no action within 30 days after receipt of the proposed decision, the decision shall be deemed adopted.

(d) Any errors or omissions in the information provided by the applicant that would affect the Department's decision may be a basis for denial of the request for hardship waiver.

(e) The decision shall be final upon adoption by the Director and no further administrative appeal shall occur. Copies of the decision shall be mailed by certified mail to the applicant or his or her designated representative.

(f) Judicial review of the final decision of the Department may be had by filing a petition for a writ of administrative mandate in accordance with the provisions of Section 1094.5, et seq., Code of Civil Procedure.

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