CHCF Explains Medi-Cal Estate Recovery

The California Health Care Foundation issued a brief explaining estate recovery rules for people with traditional Medi-Cal and people with expansion Medi-Cal under the Affordable Care Act (ACA). The tables below provide an overview:

Estate recovery for people under 55
• Under expansion Medi-Cal, never.
• Under traditional Medi-Cal, yes for all Medi-Cal costs if the beneficiary institutionalized and not expected to return home.

Estate recovery for people over 55
• Under expansion Medi-Cal, yes for all Medi-Cal costs except personal care services provided under the In-Home Supportive Services program (IHSS).
• Under Traditional Medi-Cal, yes for all Medi-Cal costs except personal care services provided under IHSS.

Home Liens During the Life of the Beneficiary
• Under Expansion Med-Cal, never.
• Under Traditional Medi-Cal, yes for all Medi-Cal costs if the beneficiary is institutionalized and not expected to return home.

Most Medi-Cal beneficiaries get care through Medi-Cal managed care, with the state paying a capitated payment to a health plan. California calculates recovery amounts based on the state’s capitation payments for those in traditional or expansion Medi-Cal. In most cases, the actual costs of services are not part of the calculation. So a person who rarely visits a doctor would be liable for the capitation amount for all months of Medi-Cal enrollment.

State and federal policymakers are reviewing the rules due to concerns that estate recovery is hindering expansion Medicaid enrollment. What is is unlikely to change soon is the federal requirement that states must attempt to recover Long-term Support Service costs for people 55 and older . However, CMS has signaled its desire stop allowing states to recoup all Medicaid expenses for this population, not just those for Long-term Support Service costs. In the meantime, the agency is encouraging states like California to consider collecting only Long-term Support Service costs for the newly eligible population. Washington and Oregon have already agreed to do so. California Senate Bill 1124 proposes to limit estate recovery for expansion Medi-Cal and traditional Medi-Cal to Long-term Support Service costs. The measure also would require California to collect the lesser of the managed care capitation payment or actual costs of services and would prohibit any recovery from the estate of a surviving spouse, even after the surviving spouse’s death. For more information, visit http://www.chcf.org/publications/2014/05/estate-recovery-medical#ixzz32wCXOueb

Last Updated 09/16/2020

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