Estate Planning for Families
27240 Turnberry Lane, Suite 200
Valencia, CA 91355

Important Facts About Medi-Cal: The Transfer Penalty

The second major rule of Medi-Cal eligibility is the penalty for transferring assets. Congress does not want you to move into a nursing home on Monday, give all your money to your children (or whomever) on Tuesday, and qualify for Medi-Cal on Wednesday. So it has imposed a penalty on people who transfer assets without receiving fair value in return.

This penalty is a period of time during which the person transferring the assets will be ineligible for Medi-Cal. The penalty period is determined by dividing the amount transferred by what Medi-Cal determines to be the average private pay cost of a nursing home in your state. The period of ineligibility starts on the first day of the month of the transfer. Example: If a Medi-Cal applicant made gifts totaling $90,000 in a state where the average nursing home bill is $5,000 a month, he or she would be ineligible for Medi-Cal for 18 months ($90,000 ÷ $5,000 = 18). Another way to look at the above example is that for every $5,000 transferred, an applicant would be ineligible for Medi-Cal nursing home benefits for one month. In theory, there is no limit on the number of months a person can be ineligible. Example: The period of ineligibility for the transfer of property worth $400,000 would be 80 months ($400,000 ÷ $5,000 = 80).

Medi-Cal Introduction
Resource (Asset) Rules
Treatment of Income
The Home
Protections for Healthy Spouse
Is Transferring Assets Against the Law?
The Transfer Penalty
Exceptions to Transfer Penalty
Estate Recovery
Lisa Golshani, Attorney at Law
27240 Turnberry Lane, Suite 200
Valencia, CA 91355
661-362-0770 Office
5023 N. Parkway Calabasas
Calabasas, CA 91302
818-334-2805 Office

lisa@golshanilaw.com