Eliminating Medi-Cal Share of Cost

Eliminate Cost

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Background:

Individuals over 65 or who are disabled and who have resources less than $2000 (less than $3000 for couples) may qualify for traditional Medi-Cal. 

Your home, one car, and personal belongings are not counted as resources. IRAs and other tax qualified plans are not counted if monthly payments of principal and interest are being taken.  If your gross monthly income does not exceed $1240 (or $1665 for a couple), you will likely be eligible for full Medi-Cal benefits.  (Only half of earned income is counted.)

If your income exceeds these limits, you can still be eligible for Medi-Cal, but you will have a “share of cost.”  A share of cost is not an amount that must be paid each month.  Rather, it is like a monthly deductible.  Medi-Cal will not pay medical expenses for you in any month until you have incurred medical expenses equal to your share of cost. If you do not incur any medical expenses that month, you will not owe anything.

The Medi-Cal Service Center will tell you what your share of cost is on the phone, and you will also receive a written Notice of Action whenever you are given a share of cost or a change in share of cost.

There are many advantages for individuals with Medicare who qualify for full Medi-Cal benefits (with no share of cost.):

  • Medi-Cal will pay your Medicare Part B premium—up to $121.80 per month
  • You automatically qualify for Extra Help for prescription drug coverage with the lowest co-pays
  • You qualify to join certain Medicare Advantage Special Needs Plans that offer health coverage at no cost, except for minimal co-payments for prescriptions.  (Individuals with ESRD are not eligible to join Medicare Advantage plans.)
  • You will not be responsible for Medicare or Medicare Advantage Plan co-pays
  • If you have In Home Supportive Services, Medi-Cal will pay your provider
  • If you need Part B immunosuppressive drugs due to a transplant, you will not be responsible for the co-insurance for those drugs

Eliminating a Medi-Cal Share of Cost:

Whether someone with Medi-Cal has a share of cost depends on their countable income.  Premiums spent on any type of health insurance will reduce the countable income.  If one’s share of cost is around $650-$750, it is often possible to eliminate the share of cost through the purchase of some type of a health insurance policy.   Spending a small amount on this insurance may be sufficient.

Tips for Eliminating Share of Cost:

  • Be sure to find out from Medi-Cal how much you would have to spend on health insurance to lower your countable income enough to get to zero share of cost.  There is no benefit to using this strategy unless you spend enough on the insurance premium to get to zero share of cost.
  • As a general rule, purchase coverage that’s a little more expensive than you need to spend.  That way if you get a cost-of-living increase you should not have to buy additional insurance.
  • Dental insurance plans are most commonly used for this purpose.  Anyone can purchase them, any time.  They will not affect your other health coverage.  And typical costs for dental plans range from about $30 to $75
  • Sometimes vision plans are purchased.  They generally cost less—in the $12- $25/month range.  Sometimes individuals buy both a dental and vision plan to reduce their countable income.
  • Occasionally individuals will purchase a Medigap plan (Medicare supplement) to eliminate their share of cost. This generally happens if the person needs to spend more than $100, since Medigap plans are more costly.  Note that Medigap plans will not sell policies to individuals under 65 unless they are in the first six months of Medicare Part B coverage.  Also, although Medigap plans cannot sell policies to individuals who have full Medi-Cal, they can sell policies to individuals, or family members on their behalf, who will use them to qualify for full Medi-Cal. People who lose full Medi-Cal have a guaranteed right to buy a Medigap policy without health screening.

You will need to submit evidence of the insurance purchase to Medi-Cal and request that they do a recalculation to eliminate your share of cost.  Keep copies of all documentation and follow up.

  • Mail documentation to:  Medi-Cal Service Center, Employment and Human Services, P.O. Box 4114, Concord, CA 94520.
  • Or Fax documentation to:  925.608.4606.

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