Podcast

In this episode, Chris Botti discusses the significant Medi-Cal changes set to take effect in 2026 and their impact on California families planning for long-term care. He delves into the asset assessment, asset test, look back period, and how these changes will affect eligibility for Medi-Cal benefits.

What drew you to estate planning and Medi-Cal law, particularly in California?

Chris Botti shares his journey into estate planning, highlighting the positive experience it offers clients and the long-lasting relationships it builds. Starting his law career at a young age, he recognized the importance of life experience in estate planning and transitioned into the elder law arena as his clients aged and faced long-term care concerns.

Why are the 2026 Medi-Cal updates significant, and what are the key changes happening on January 1st?

The 2026 Medi-Cal updates reintroduce the asset test and look-back period, influencing eligibility criteria for the long-term care Medi-Cal program in California. These changes require individuals to undergo asset scrutiny when applying for Medi-Cal benefits, which was not in place for the previous two years, creating a limited planning window until the end of the year.

Who will be most impacted by the Medi-Cal changes—new applicants or those undergoing re-determination next year?

Both new applicants seeking Medi-Cal benefits after January 1st and existing recipients facing re-determination will be affected by the reinstated asset test and look-back period. This change prompts significant decisions and planning strategies within a short timeframe, causing anxiety among individuals navigating the Medi-Cal program.

What are the potential consequences for individuals with assets above the new limits when the rules change in 2026?

Failure to meet the asset test could lead to loss of eligibility for Medi-Cal benefits, which could have devastating financial implications, especially concerning long-term care costs. Seniors may risk going bankrupt due to high care expenses if they lose Medi-Cal eligibility, emphasizing the urgency of taking proactive steps to address asset planning.

Which assets can families retain without affecting Medi-Cal eligibility, and which ones pose challenges?

Exempt assets, such as retirement accounts and primary residences, do not count towards Medi-Cal eligibility, irrespective of their value. On the other hand, non-exempt assets need to be carefully managed as they impact eligibility criteria, requiring individuals to differentiate between exempt and non-exempt assets during the Medi-Cal application process.

How are married couples treated differently under the revised Medi-Cal standards, especially in scenarios where one spouse requires long-term care?

In cases where one spouse needs long-term care while the other remains at home, California’s special impoverishment rules aim to safeguard assets and income for the well spouse. These provisions offer additional protections for married couples facing unequal healthcare needs, ensuring that the at-home spouse can maintain financial stability and avoid potential bankruptcy.

How does an irrevocable Medi-Cal asset preservation trust function under the 2026 rules, and why is legal expertise essential in setting up such trusts?

The irrevocable Medi-Cal asset preservation trust serves as a crucial tool in protecting excess resources for Medi-Cal eligibility purposes while allowing individuals to retain control and safeguard assets within the family. Legal professionals emphasize the importance of seeking qualified legal guidance for establishing these trusts to ensure compliance with legal requirements and prevent unauthorized practice by non-lawyers.

For families preparing for the Medi-Cal changes, what initial conversations should they have with their loved ones and legal advisors?

Open communication and family involvement are key in preparing for Medi-Cal changes, encouraging discussions among family members to understand the planning needs and reach out to experienced legal professionals for guidance. Establishing a proactive approach to estate and long-term care planning fosters peace of mind and ensures preparedness for potential future needs.

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