Mom and Medi-Cal

September 8, 2013
Gordon Mullin

Gordon Mullin


(Editor’s note: This is the first edition of a column by San Luis Obispo financial planner Gordon Mullin called A Penny Saved)


That’s the sum that my deceased mother’s estate owed to California’s Medi-Cal program. That’s the amount they paid for her long-term care (LTC) in a local nursing home, and after she passed, they wanted it back.

How we got here is an instructive tale for anyone over 50 or who has a relative beyond that. Before I begin my story, let’s first get a fundamental definition down. LTC is a condition in which we all may find ourselves some day. You will, by definition, need LTC if you are unable to do on your own one of these activities of daily living: bathing, toileting, dressing, getting out of bed, eating or walking. Or, and here’s the biggie, you’re mentally impaired. Any inability with these activities will require you to seek help from someone. There’s no getting around it — you must— and where you receive help and from whom makes all the difference in the world.

My story really begins in 1979 when my dad got Alzheimer’s, or at least we think it was Alzheimer’s. It matters not what is the cause of the dementia, it’s the effect that matters. I won’t belabor this part of my story, but over the course of two years, my father turned from my loving, independent, joking pop to a man who knew not my name, nor where he was; nor was he even aware that pajamas were not appropriate attire to wear outside of his home.

My mother became his nurse, doing all things for him, and she also became his jailer for he would walk outside when she wasn’t looking, go a block and get lost. And, oddly, he became her jailer; if she attempted to go anywhere without him he would go into a rage. For almost two years their lives were intertwined in a way neither had ever anticipated. Mom hired help sometimes, just to get a break but dad would usually chase them away. He was a big man and few would deal with his wrath when mom left.

I was living out of the country at the time and one day I telephoned her to let her know I was coming for a visit. She said, and I’ll never forget her words, “your father’s not here anymore. He’s in a nursing home. I couldn’t do it anymore.”

Thereafter I’d see my dad in the LTC facility, a.k.a. nursing home. He didn’t recognize me, but I’d try to talk to him anyway. Regretfully he usually declined to chat; maybe he couldn’t. But each time when I’d get up to leave, he’d become animated and he’d ask, “would you take me home? I want to go home” and I’d have to say “no, pop I can’t”.

Within six months he died, but during those months my mom had to pay for his care in that facility. I don’t know exactly how much it cost, but I can tell you she felt the loss.

In 1998 I moved back to my old hometown, in part because mom was 84 and I felt I couldn’t be so far away. It seemed she needed help, not a lot, just some. As time went on, I found myself at her home more and more taking care of simple events: cleaning, cooking and handling her affairs. She became progressively forgetful — leaving boiling water on the stove, forgetting how to make her own breakfast. Eventually, it just seemed easier if we lived together and I moved in.

Over the course of several years, the son became the parent and my mother became the child. Dressing and bathing were daily arguments, but I could handle that. I thought I could handle anything,everything, right up til she broke her leg. From the hospital she went to a local nursing facility.

Mom lived there for 27 months, trapped in her wheelchair, unable to do anything for herself. The dementia progressed and in the last year, she forgot not only my name but hers as well.

We eventually went through her funds paying for her care and that’s when Medi-Cal kicked in paying for the facility when she had no money left, just her home. And then she died and now Medi-Cal wants to be paid back for the payments they made. It’s the law.

And that’s how we got to here today.

The California Deptartment of Aging says that if you reach 65, the odds of being in a nursing home for more than a year is one in four. Hence, the odds of needing LTC are even higher than that since many who will need LTC may not go into a nursing home but will receive help either at home via the growing home health care industry or in the new assisted living alternatives. Note neither of which are paid for by Medi-Cal and only in limited circumstances by Medicare.

We all make choices today about the future and planning for how we will pay for LTC has become one of the most critical components of financial planning for the retired. In short, there are only four means to fund or manage the cost of LTC.

First is turning to your family to provide support. We have for centuries presumed that our kids and relatives would clothe and bath us when that time came and if you’re comfortable with that choice, and the kids agree, you’re done. However, if you don’t foresee your sons and daughters taking you into their home and providing LTC for you, you may want to consider the alternatives.

Second is paying for it yourself. If you have the funds and don’t mind spending them, you now have a plan. Consider also the ramifications if your family’s money is spent on your care, i.e. where may that leave the surviving spouse financially.

Third, turn to an insurance company and purchase an LTC policy. The premiums become higher the older you are when you apply, just like life insurance so look into buying a policy earlier rather than later. Plus, you have to qualify, medically, and I’ve seen many folks wait too late and they’re rejected by the insurance company due to pre-existing conditions.

Lastly, you can (probably) count on the government covering your LTC costs in the end, but only A) when you’re in a nursing home and B) after you’ve already spent down your assets sufficiently to ‘qualify’ for aid. And, like in my family’s circumstances, while a home may be an exempt asset while you live, after death, the state will seek recovery of their money by forcing the sale of the now not exempted assets.

The choice is yours.

Mullins can be contacted at, or his office at (805) 592-2220 or through his website-

Securities and advisory services offered through NATIONAL PLANNING CORPORATION (NPC), Member FINRA/SIPC, a Registered Investment Adviser.



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I went through this with both my parents. They had LTC insurance so the expense was of little concern as it paid for in home care, then assisted living care and eventually the cost of the nursing homes. I believe they purchased the insurance when my dad retired at 65.

HOWEVER – My sister-in-laws parents had no insurance and both her parents developed dementia as well. She was actually able to save her parents assets and inherit their home free and clear despite the government had paid for her parents LTC in a nursing home. She hired an attorney who knew how to get around this and she didn’t have to pay the government back. She inherited almost 300K at the end. Not sure how she did it but she was very clear that there is a way to protect the family assets if necessary. This occurred in Rhode Island and I don’t know if he same can be achieved in California.

What strikes me as odd is that dementia/alzheimer’s has become so prevalent. Yes the aged used to develop forgetfulness and even senility but never to this extent or severity if at all. Today it’s common to have this happen to at least one parent, not so when I was growing up and plenty of people lived into their late 70’s and 80’s.

I read somewhere a few years ago, they are finding that the brains of people with alzheimers, had a much higher level of mercury than those people who did not have the

condition. There’s lots of info about it in the internet.

That You, I spent some time reading on it. I have always wondered about my dad and why this happened to him (it lasted 7 years). There is no history of alzheimers or dementia in his family and they all live very old. It was/is very common in my family to have great aunts and uncles in their 90’s, and “sharp as a whip” on my dads side. My mothers side had no history of alzheimers either and she was in the nursing home for ill health that was physical.

My dad worked in the textile industry where materials were dyed to order. He was in and out of the dye plant constantly and I recall visiting him at work as a child and he took me through the plant. There were large vats (open) with lots of steam as materials were being dyed. Yesterday, I learned that commercial dye back in the 60’s & 70’s contained a large amount of mercury and it is emitted in steam. It broke my heart.

Actually dye today still contains some mercury, especially hair color!

So, your sister in law hired an attorney who was able to scam the rest of us into paying for her parent’s LTC, while the children (and the attorney) were able to keep the parents’ money.

Cindy, how do you feel about this?

Doesn’t any one want to do the right thing these days? Or is everyone out to scam all they can get from any and everybody else? It was NOT the govt that your sister in law “found a way around”, it was the rest of us honest, hard working folks. No way of denying or rationalizing that.

Don’t know if I would call it a “scam”. If the help if available, then it is available. Apparently attorneys knew something that my sister- in-law didn’t and she was wise enough to seek their advice. As a result of that advice, she didn’t have to turn her parents home over to the state after her parents were deceased in fact she didn’t have to pay the state of RI anything. I have seen commercials here in CA about this problem (expense) of LTC with the elderly. The commercials say that families should not “SPEND DOWN THE FAMILY ASSETS”. They inform the public that there is another way to receive care for the elderly while protecting the family assets. Just saying that it’s worth looking into.

I, like others here have stated, think that the system works fairly. And it worked fairly in your family’s case. You don’t come out and say it, but you allude to the idea that you don’t think the system was fair to YOU or to YOUR family. If you feel that way, you should say it.

In fact, while reading your essay, I was surprised to learn that something the state has done was actually a good idea. A somewhat rare occurrence these days. It seems to be just the right balance of government involvement.

I know that in today’s the-govt-owes-me-everything way of thinking, this is old fashioned thinking, but that is why you work hard and make good decisions throughout your life – so that you can build up assets, and then use them up when you need them. I applaud and respect your parents for having done so. I hope that they were able to pass on and instill those values in their children.

BTW, I too have been thru this for both my parents and my in-laws. And the Govt never paid a dime – a fact that we were all proud of.

The trouble with medical science is that it adds years to the end of your life, instead of the middle. People live too damn long now.

I don’t know about that Shel…what about babies that are saved by medical scientific achievements everyday. We may indeed be living longer but many people live longer in a healthier physical condition. Today cardiac patients in their 40’s are alive because of stents and open heart procedures. Medical advancement is a good thing and everyday on earth is a blessing.

Everyone, young and old should have a living will.

You don’t need a lawyer, you can download the form

from the internet. After filling the document out, give

copies to your spouse/and or kids.

If you wind up in the hospital, brain dead…you can choose

if you want to be unplugged or not. This makes it easier

for your family, if you make the choice ahead of time, so they

don’t have to….

I went through this with both my grandfather and then my mother. The system is fair and set up to be less of burden to the taxpayers. When my mom died, the lien on her house from med-i-cal was paid from the house proceeds. That is fair. She never wanted to be a parasite and this allowed her to pay her own way.

What about BEFORE she dies? what about the costs associated with LONGTERM care like the children and grandchildren being there? Lights, are still on, meals still eaten car payments and rent still due. a LONGTERM care plan is necessry

What? The whole system seems to make pretty good sense. What’s the problem?

Irrevocable Special Needs Trust administered by a relative?