If you are on Medi-Cal and you receive an inheritance, it may jeopardize your benefits.

Medi-Cal recipients must report receipt of any income or assets that would affect the share of cost or eligibility to the county eligibility worker within 10 days. However, if an inheritance which is in the form of cash is received in a given month, it is considered income in the month of receipt, so it can be spent down for any purpose. To ensure one’s Medi-Cal is not discontinued in the following month due to being over the asset limit, one should spend down the inheritance received within the month. Because the cash inheritance is considered income in the month of receipt, the resident can gift the funds in the month of receipt, or spend it on anything they prefer. At the end of the month, the recipient can send proof that the funds have been spent/transferred. Below are some options for spending down:

If you are in a nursing home:

• New clothes and shoes — but mark to prevent theft or loss
• New television, radio, telephone or an electronic reading device
• Prepay cable, telephone and internet
• New hearing aid, dental needs or eyeglasses 
• Gift Cards of any amount (do not count as assets for Medi-Cal purposes)
• Prepay funeral and burial costs.

If the recipient receives a significant inheritance:

One may consider a Special Needs Trust. A Special Needs Trust (SNT) or a Pooled Trust (for persons over 65) is a way to reserve money for the person’s needs that Medi-Cal or SSI won’t pay for and it will not affect public benefits.

Call CANHR’s office at (800) 474-1116 for a lawyer referral to an estate planning attorney, or if you have any questions.