As the saying goes, the only constant is change.
This adage certainly applies when it comes to strategies for protecting one's assets against Medi-Cal estate recovery.
Effective January 1, 2017, California's Medi-Cal recovery unit -- subject to certain limited exceptions -- will no longer seek reimbursement against assets held by the decedent in a revocable trust. Rather, Medi-Cal will henceforth collect only against assets subject to probate.
(Medi-Cal is California's version of Medicaid, which provides healthcare coverage to the disabled and to those of limited means. Probate is the court-directed settlement of estates governed by a will ("testate"), or by no will or other estate plan ("intestate").
Medi-Cal's new "hands-off" approach with respect to trust-held assets adds yet another incentive to placing property into a revocable trust. Trusts also avoid probate, allowing assets to pass upon death without court administration.
Note, however, that besides revocable trusts, other methods can be used to pass property without probate. Property held in joint-tenancy, for example, vest upon death of one joint-tenant in the name(s) of the surviving joint-tenant(s). But this approach carries its own unique risks.
The best plan of action is to sit down with an experienced attorney. It costs you nothing. Call Gale & Nielsen to arrange a complimentary half-hour consultation: (707) 269-0167.