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Medi-Cal Update 2023-15 Additional Information on Asset Elimination for Non-MAGI
Additional Policy Guidance Related to Asset Elimination for Non-MAGI Medi-Cal
| Date | References | Clerical | Handbook(s) Revised |
| 12/21/2023 | ACWDL 23-17, ACWDL 23-20, MEDIL I 23-39, ACWDL 23-28, ACWDL 23-29 | N/A | MC HB Ch 15, 16, 19, 33, 34 |
Background
The following is additional policy guidance related to the elimination of assets when determining eligibility for Non-MAGI Medi-Cal programs after January 1, 2024.
Changes
The related Medi-Cal policies have been revised in their respective Handbook sections.
Overpayments
Effective January 1, 2024, counties are no longer required to report overpayments based on excess property since resources will no longer be used to compute Non-MAGI eligibility. Overpayments occurring prior to January 1, 2024, may continue. There is no change to requirements to report overpayments based on increased or unreported income, and failure to report other health coverage.
The Overpayment Overview and Types of Potential Medi-Cal Overpayments sections have been revised.
Income-producing assets
Effective January 1, 2024, the undistributed balance of an annuity, Individual Retirement Arrangement (IRA), retirement plan for Self-Employed individuals, and work-related pension funds are not counted as property when determining Medi-Cal eligibility. Payments distributed from these types of funds will continue to count as unearned income. Individuals will not be required to receive periodic payments in order to qualify for Non-MAGI MC. These funds shall not be considered unconditionally available income when determining eligibility. A contract, a benefits letter, a bank statement showing the deposit, or a sworn statement can be accepted as verification of income from these sources. Information to verify the amount and frequency of distribution payments should be provided, verification of the remaining balance is not required and should not be requested. The net income produced from the rental of real property will continue to count as income for MC.
Pension Funds (i.e., IRAs, Keogh) and Income Definitions sections have been revised.
Interest and dividend payments from Assets after January 1, 2024
Interest and dividend income from assets are typically counted as unearned income in the Non-MAGI MC eligibility determination. There are some instances where these types of funds are exempt and excluded in the Non-MAGI MC budget. The Income Definitions section has been revised in the MC HB.
Treatment of trusts after January 1, 2024
The principal of a revocable or irrevocable trust is disregarded because resources are no longer a factor in determining MC eligibility. Payments from a trust continue to be counted as unearned income to the individual.
Treatment of OBRA '93 Trusts, and Treatment of Other Trusts have been revised.
Estate Recovery
Federal law still requires DHCS to seek repayment from the states of certain deceased MC members. Estate recovery only applies to members who are: age 55 and older, members of any age who are determined permanently institutionalized (are an inpatient in a nursing-level care facility and are not expected to return home), and who own assets at the time of their death.
Repayment is limited to estate assets subject to probate that were owned by the deceased member at the time of their death. DHCS does not seek repayment when the member's assets are not subject to probate.
The Estate Recovery section has been revised.
Transfer of Assets after January 1, 2024
Counties shall not request verification or review electronic asset verification information regarding transfers of property made, or calculate any periods of ineligibility for transfers made on or after January 1, 2024, for LTC applicants, MC members, or their spouses. This includes transfers of lump sums and income streams, such as mortgages, loans, and annuities. Transfers made prior to January 1, 2024, continue to be subject to the transfer of assets rules. Individuals must be reviewed for undue hardship before imposing a period of ineligibility.
Asset Verification Program (AVP)
The asset verification program operations will be significantly reduced in scope after January 1, 2024, due to the elimination of the requirement to consider assets when determining eligibility for Non-MAGI MC. AVP will no longer be used to determine or redetermine eligibility for Aged, Blind and Disabled (ABD) applicants and members, but only to determine whether ABD applicants or members seeking coverage for Long-Term Care (LTC) made asset transfers for less than the fair market value during the federally mandated lookback period.
Verifications of Applications, and Verification Requirements at MC RD and CIC have been revised.
Implementation
These policy changes are effective January 1, 2024.
Other Programs
These changes only affect the Medi-Cal program.
Supervisors
Supervisors, please review this Update and the corresponding Handbook sections with your staff.
Angela Shing, Director
Department of Employment & Benefits Services
Contact Person(s): Megan Turney, SSA BPIS, 408-755-7540.