5 Facts to Know Before You Start Medi-Cal Planning

This is the biggest surprise for most families. Medicare covers up to 100 days in a skilled nursing facility, and only after a qualifying three day hospital stay. It pays for skilled nursing and rehabilitation, not for custodial care, which is help with bathing, dressing, eating and moving around.

Most people never reach 100 days. Once you stop improving, the care is reclassified as custodial and Medicare coverage ends. The average stay is under 24 days.

At roughly ten to fourteen thousand dollars a month, private pay takes most families only so far. That is why Medi-Cal ends up being the answer.

On January 1, 2024, California stopped counting assets for Medi-Cal altogether. Eligibility came down to income alone.

That is not permanent. The recent state budget agreement brings asset limits back on January 1, 2026, at 130,000 dollars for one person plus 65,000 dollars for each additional household member.

So the planning advice that was right in 2023, and the advice that was right in 2024, and the advice that will be right in 2026 are three different things. Check the date on anything you read.

If your income is above the limit you can still qualify, with what is called a shared monthly cost. It works like a monthly deductible. You pay that amount toward your care and Medi-Cal covers the rest.

That figure can often be brought down, for example by buying supplemental dental, vision or prescription cover, which lowers countable income.

The spousal impoverishment rules exist so that one spouse needing care does not leave the other with nothing. The spouse at home keeps income paid in their own name, and where they earn less than the monthly maintenance allowance, income can be moved across to them from the spouse receiving care.

These protections now cover care at home and in the community, not just nursing homes.

Even after someone qualifies, the state can bring a claim against their estate after death to recover what it paid. Estate recovery is a separate problem from eligibility, and it is the part families most often find out about too late.

This is usually handled with a revocable living trust, put in place well before anyone needs care.

Do not start giving assets away in a hurry. Talk to an attorney and a tax adviser first. The consequences reach well beyond Medi-Cal, and a transfer made in the wrong year can create a penalty that was entirely avoidable.