Will selling a mobile home affect Medi-Cal eligibility?

A fellow caregiver asked...

My mother recently qualified for MediCal in California but has not yet needed to file for any benefits. She currently is has in-home hospice care which is paid for by Medicare. If she sells or gives her mobile home to my brother, who has been her live-in caregiver for the past two years, how would this affect her MediCal eligibility or benefits if needed in the future? Her home is only worth approximately $15,000. Thanks.

Expert Answer

There are two different sets of Medicaid (Medi-Cal is the name California gives to its Medicaid program) rules that could protect your mother's eligibility for Medi-Cal coverage if she gives (rather than sells) her mobile home to your brother. One set of rules applies if she receives Medi-Cal medical coverage (for hospitalization, doctor bills, skilled nursing care, hospice). The other rules apply if she were to enter a nursing home for long-term care. Let's take them one at a time.

(1) Medi-Cal medical care coverage. When deciding eligibility for Medi-Cal medical coverage, the Medi-Cal program looks at the amount of income and assets a person has. The permissible amount of assets for an individual is only around $2,000. However, a home the person lives in, plus a car and several other personal assets, are not counted toward this asset eligibility limit. So, as long as your mother own the mobile home and lives in it, it would not affect her Medi-Cal eligibility. Giving the home to your brother also would not affect her eligibility because then the home would no longer be her asset, and there is no rule regarding Medi-Cal medical coverage that penalizes someone for giving away assets. However, if your mother sells (rather than gives away) the home to your brother, any money she receives for it would be considered part of her assets and might disqualify her for Medi-Cal medical coverage until she spends the money down to the asset limit for eligibility.

(2)Medi-Cal long-term nursing home coverage. If your mother needs long term nursing home care, Medi-Cal can pay the full cost (in a facility that accepts Medi-Cal residents). As with Medi-Cal medical coverage, eligibility for Medi-Cal nursing home coverage is limited to people who have very low income and few assets. So, if your mother sells her home to your brother, any money she received for it, and still had at the time she applied, would count against the asset limits for Medi-Cal nursing home coverage.

But in addition to looking at the amount of assets someone has when applying for nursing home coverage, Medi-Cal also looks at any assets that have been given away during the five years previous to the application. (This rule is different from the rules that apply to Medi-Cal medical coverage, discussed above.) If an applicant has given away assets during that time, Medi-Cal might consider those assets as still belonging to the applicant and penalize the applicant by denying eligibility for a period of time (the length of time depending on the amount given away). So, under most circumstances, if your mother gave away her mobile home to anyone -- including your brother -- during the five years before applying for Medi-Cal nursing home coverage, this might disqualify her from eligibility for a period of time.

However, a special Medicaid rule could protect her in this case. That special rule says that a home may be given away, without any Medi-Cal coverage penalty, to the applicant's child (your brother) if the child lived in the home for two years prior to the parent's entry into a nursing home and cared for the parent, which allowed the parent to remain at home instead of entering a nursing home during that time. Since you describe your brother as having taken care of your mother while living with her, it sounds as if their situation might qualify for protection under this special Medi-Cal rule. Under this rule, the important question that Medi-Cal might want to have answered is whether your mother would have otherwise needed nursing home care during the time your brother cared for her. The answer to that would come from her medical records and description of her condition by her doctor, as well as by descriptions, from anyone with knowledge of the situation, of her need for care and the care your brother provided.