California Senate Moves To Limit Medi-Cal Estate Recovery

The California senate has unanimously advanced a bill (SB 33) to limit the amount of assets that California can recoup from deceased Medi-Cal beneficiaries, the Los Angeles Times reports.

Medi-Cal is California's Medicaid program (Pfeifer, Los Angeles Times, 6/5).

Background

In 1993, the federal government began requiring all states to recoup the long-term care costs of Medicaid beneficiaries ages 55 and older after they die.

The "estate recovery program" requires states to recoup assets for nursing home care, but it is optional to recover assets for medical services, such as doctor visits and hospital stays.

In 2013 and 2014, California recovered $61 million from 3,900 cases, according to Carol Sloan of the state Department of Health Care Services. However, it is unclear how much of that money was for nursing care and how much was for medical services.

Details of Bill

SB 33, by state Sen. Ed Hernandez (D-West Covina), aims to remove the optional recovery provision in California, limiting the services for which the state can recoup assets to just nursing home care (California Healthline, 3/27).

The bill would:

• Allow survivors to obtain hardship exemptions to keep the state from seizing homes that are worth 50% or less than the county average; and
• Keep the state from recouping Medi-Cal costs from surviving spouses' estates (Los Angeles Times, 6/5).

The California Advocates for Nursing Home Reform is sponsoring the measure, which now heads to the Assembly.

Last year, Gov. Jerry Brown (D) vetoed a similar bill (SB 1124) by Hernandez, saying, "Allowing more estate protection for the next generation may be a reasonable policy goal. The cost of this change, however, needs to be considered alongside other worthwhile policy changes in the budget process next year" (California Healthline, 3/27).

According to some estimates, limiting the estate recovery program could cost California about $25 million annually.

In addition, Margaret Hoffeditz, chief of the state Department of Health Care Services' recovery branch, noted that survivors already can apply for hardship exemptions -- DHCS granted 100 such requests in the last fiscal year.

However, Hernandez said Brown should take steps to limit estate recovery this year "either through the budget or by signing this bill," adding, "I trust that he will make the right choice" (Los Angeles Times, 6/5).