For your mother to qualify for Medi-Cal in the first place, her home was counted as an exempt asset for eligibility purposes. However, except under very limited circumstances, the state will require repayment for moneys paid out for your mother after your mother has died.
If the house is sold while your mother is still alive, she would no longer have an exempt asset (i.e. her house), and the state would not only remove her from Medi-Cal, but would likely make a claim for reimbursement right away for moneys already expended on her behalf.
Do not attempt to do anything without the assistance of a qualified elder law/Medi-Cal attorney, because a mistake made that this point could cause a serious loss of property.
Please remember to mark what you believe to be the best answer to your question. This answer is provided by estate planning attorney Robert P. Bergman, with offices in San Jose, California. Mr. Bergman is a Certified Specialist in Estate Planning, Trust and Probate Law (State Bar of California Board of Legal Specialization), and has been practicing since 1980. This answer does not create an attorney-client relationship, and is only intended to provide general legal advice within the limits of the question asked. If you wish to create an attorney-client relationship for specific legal advice, it will be necessary to enter into an engagement for legal services. More general legal information about wills, living trusts, and estate planning can be found at Mr. Bergman's main website at www.lawbob.com, or his information website at www.lawbob.net. Mr. Bergman also offers free living trust seminars and wealth preservation seminars at his offices in San Jose. For those unable to attend a live seminar, an online living trust seminar may be viewed or downloaded at www.freelivingtrustseminar.com.
As Mr. Bergman mentions, the time frame may have already passed. Not only because selling or transfering the home would likely make your mother ineligible to continue welfare. However, states do typically create an exemption amount for basic post-life necessities, such as funeral costs and burial-cremation costs. So speak to an elder care attorney locally who would know CA laws on exemption amounts before the Estate Rule goes into affect, allowing a recoup of welfare monies.
Matthew Johnson phone# 206.747.0313 is licensed in the State of Washington and performs bankruptcy, short sale negotiations, and estate planning in Whatcom, Skagit, Snohomish, King and Pierce counties. The response does not constitute specific legal advice, which would require a full inquiry by the attorney into the complete background of the facts and circumstances surrounding this matter; rather, it is intended to be general legal information based on the limited information provided by the inquirer; it This response also does not constitute the establishment of an attorney-client relationship, which can only be established after a conflict of interest evaluation is completed, your case is accepted, and a fee agreement is signed. Johnson Legal Group, PLLC
Both attorneys offer comprehensive responses. Still you need to get with an elder law attorney BEOFRE any actions are taken that could impact benefits and taxes. Do not rely on a general forum; get a real expert to assist you.
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California is not exactly 'User-Friendly' in this regard. Your mom's home was originally counted as an Exempt Asset for purposes of determining her Eligibility. The state can require repayment for moneys paid out for your mother after she is deceased. I concur that it would be VERY wise to consult with a qualified Elder Law attorney right away before making a decision to make sure she doesn't lose her coverage. Good Luck!
As the other attorneys stated, the house and car are considered exempt, and thus will not affect Medi-Cal Eligibility. And as had been stated, if the house remains in your mother's name (even though in the Trust, which is considered to be your mother's alter-ego), then recovery can be made against this after your mother passes. However, there are some things that can be done. First, if you have been a caregiving child for 2 years prior to the MC application, there is an exception against recovery. However, the house can also be gifted directly to you, with an Occupancy Agreement allowing your mother to occupy the house for her lifetime; or gifted into an Irrevocable Trust, also retaining residency rights. Both options take the property out of your mother's name and will not be subject to recovery. You definitely should contact a qualified elder law attorney.