Kming Rosenthal recently inherited $5,000 after her birth mother passed away last year. Rosenthal, 72, who lives off her social security disability benefits and doesn鈥檛 have much in savings, welcomed the extra cash.
She planned to deposit most of the new money in her savings account, but soon learned that if she wanted to keep her free Medi-Cal coverage, she couldn鈥檛 have more than $2,000 in the bank because it would disqualify her from Medi-Cal under what鈥檚 known as the 鈥渁sset test.鈥�
Rosenthal, who lives in Orange County, panicked. She needs Medi-Cal, the state鈥檚 insurance for low-income Californians, to help cover her pricey HIV medication and other costs not fully covered by Medicare, which covers seniors. She had to spend the money 鈥� she bought a new bed and a refrigerator 鈥� so that it wouldn鈥檛 affect her eligibility.
Now she wishes she鈥檇 waited. 鈥淚鈥檝e recently run into some shortages and I think, 鈥榠f only I could have kept more of that money,鈥欌�� she said.
It鈥檚 too late to help Rosenthal, but the California Legislature is seeking to eliminate the Medi-Cal asset test once and for all.
In its budget approved earlier this month, the Legislature included an to cover the expected increase in Medi-Cal enrollment as a result of axing the asset limit. A final budget is still pending as negotiations with Gov. Gavin Newsom continue this week.
The governor鈥檚 May budget revision did not address the Medi-Cal asset test and he has not commented on it publicly.
The Legislature also is negotiating or awaiting final approval for other Medi-Cal changes, including:
- Allowing older, undocumented Californians to sign up for Medi-Cal at either 50 or 60 years of age. Setting the minimum age at 60, as proposed by Newsom, would add an estimated 89,000 new people to the Medi-Cal rolls by 2024-25 and cost about $1 billion annually. The Legislature鈥檚 budget starts the expansion at age 50.
- Extending how long women can stay on Medi-Cal post pregnancy from 60 days to a year. This expansion would be in place for five years.
- for pregnant women as a benefit covered by Medi-Cal starting on Jan. 1, 2022.
- Removing expiration dates for 鈥渙ptional benefits鈥� 鈥� such as speech therapy, eyeglasses and podiatry services that states are not required to cover. These benefits were eliminated during the Great Recession and restored in 2019, but have expiration dates.
鈥淭his is a complete 180, from potential cuts and rationing to program expansions,鈥� said Linda Nguy, a policy advocate with .
Last year, as the state induced by the coronavirus pandemic, advocates achieved in the past years as the state recovered from the Great Recession. Although most programs stayed as is last year, planned program expansions were put on hold.
Now, with a , Newsom and lawmakers are discussing offering more benefits to more people for longer periods of time.
鈥淭his is a complete 180, from potential cuts and rationing to program expansions.鈥�LINDA NGUY, WESTERN CENTER ON LAW AND POVERTY
As of March, 鈥� about a third of the state鈥檚 population 鈥� were enrolled in Medi-Cal. That鈥檚 about 1.2 million more people than were enrolled a year earlier because people lost jobs and wages during the pandemic. Nationally , the federal insurance program for the poor, during the pandemic,
Claire Ramsey, an attorney with , said given the need and the state鈥檚 strong economic standing, now is the time to expand Medi-Cal to people who have been left out and eliminate outdated barriers.
For years, advocates and some lawmakers have been proposing to expand Medi-Cal benefits to unauthorized immigrants. They鈥檝e succeeded through a piecemeal approach, first opening the program to undocumented children and then young adults up to age 26. Older adults would be the latest addition.
by Assemblymember Joaquin Arambula, a Fresno Democrat, seeks to expand Medi-Cal to all income-eligible undocumented immigrants, regardless of age.
People without legal status are barred from federal health coverage programs under the Affordable Care Act 鈥� commonly known as Obamacare 鈥� so health expansions for this population must be paid by state-only funds.
One thing Obamacare did do is eliminate Medicaid鈥檚 asset test for most people. It only applies to seniors and people with disabilities, driving financial instability among these already vulnerable groups, Ramsey said.
But, as Kming Rosenthal found out the hard way, besides needing , a person cannot have more than $2,000 in certain types of assets; the limit for a couple is $3,000. These thresholds have not changed since 1989, when the average movie ticket .
The thinking is that if people have over a certain amount in resources, then that money could go toward paying for health care. 鈥淭hat means people can鈥檛 save for uncovered health expenses鈥r a move; a month鈥檚 rent and deposit are more than that,鈥� Ramsey said.
And the , leaving some people confused about what counts against their eligibility. Checking and savings accounts, cash on hand, a second car and life insurance count in the asset test, but a home and one car are exempt. Ramsey said that means low-income renters whose only assets may be in cash are at a disadvantage.
As of March, 13.7 million people 鈥� about a third of the state鈥檚 population 鈥� were enrolled in Medi-Cal.
Close to for Medi-Cal if the state eliminates the asset test, according to a March 2020 report from the Department of Health Care Services, which oversees the Medi-Cal program.
Assemblymember Wendy Carrillo, a Democrat from Los Angeles, introduced a bill that also seeks to repeal the asset test in case it doesn鈥檛 get done through the budget. builds on legislation from 2019 that sought to increase the limit of countable assets from $2,000 to $10,000 for an individual. That two-year bill was shelved during the pandemic.
Ramsey said health advocates are not concerned that eliminating the asset test would allow rich people to get on Medi-Cal. 鈥淭hat鈥檚 a unicorn problem; we鈥檙e talking about a person who would have to be very low income but somehow rich in assets. If you could afford to get care anywhere, I don鈥檛 think you鈥檇 pick a Medi-Cal bed,鈥� Ramsey said.
Ahead of California, nine states plus Washington D.C. have , and Arizona got rid of it.
Many people on Medi-Cal may not even know about the asset rule until it comes time to renew their coverage.
鈥淭his state, of all states, needn鈥檛 look very far to see how many people are living in the streets,鈥� Rosenthal said. 鈥淥ne misstep with my benefits and that could be me, and with my health conditions, that truly would be a death sentence.鈥�
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