Case Examples

Don't Use Your Home Equity To Pay For Long-Term Care

Mary was 72 years old and widowed when she entered a nursing home. Worried about how she was going to pay for her care, she contacted a friend for advice. Mary’s friend told her that she should sell her house and pay for her care with the proceeds. Not knowing what else to do, Mary followed her friend’s advice and used her home equity to pay for her nursing home care.

An elder law attorney would have explained to Mary that she could qualify for Medi-Cal without having to sell her home. A person must have less than $2,000 in counted assets in order to qualify for Medi-Cal. But something that most people do not know is that the applicant’s home is not a counted asset as long as he/she expresses on the Medi-Cal application his/her intent to return home. A person can do this even if it is medically impossible to return home. Therefore, if Mary had expressed her intent to return home on her Medi-Cal application and had less than $2,000 in assets (not counting the home), she could have had her nursing home bills paid for by Medi-Cal and would have been able to keep her house too. However, Mary would still have to do additional Medi-Cal planning in order to prevent the state from asserting an estate recovery claim on Mary’s estate when she dies.

For more on information on Medi-Cal and Medi-Cal eligibility click here.