If you receive a personal injury settlement in California and rely on Medi-Cal or Medicaid for healthcare coverage, you may wonder how your benefits will be impacted. Understanding the relationship between settlements and public health benefits is essential to protect your coverage and financial security. At Wilshire Law Firm, we help clients navigate these complex issues with clarity and confidence.
How Medi-Cal and Medicaid Work
Medi-Cal is California’s Medicaid program, providing healthcare coverage for individuals with limited income and resources. Eligibility is based on income and asset limits. If your financial situation changes significantly, such as receiving a settlement, it could affect your eligibility.
Will a Personal Injury Settlement Affect Your Benefits?
Yes, it can. Medi-Cal and Medicaid consider your assets and income when determining eligibility. A settlement may increase your resources beyond the allowable limits, which could:
- Temporarily disqualify you from benefits
- Require you to spend down assets to regain eligibility
- Trigger reimbursement obligations to the state for medical expenses paid on your behalf
Understanding these rules before accepting a settlement is critical.
Medi-Cal’s Right to Reimbursement
Under federal and state law, Medi-Cal has a right to recover costs for medical care related to your injury. This is called a Medi-Cal lien. If you receive a settlement, Medi-Cal may claim a portion to reimburse the program for treatment expenses.
How Does a Medi-Cal Lien Work?
- Medi-Cal calculates the amount spent on your injury-related care
- The lien is asserted against your settlement
- Your attorney can often negotiate the lien amount to reduce your financial burden
Ways to Protect Your Benefits
There are legal strategies to help minimize the impact of a settlement on your Medi-Cal or Medicaid eligibility:
1. A Trust
A properly structured trust can hold settlement funds without counting them as available assets for eligibility purposes.
2. Spend Down
Using settlement funds for approved expenses, such as medical care or home modifications, can help you meet asset limits.
3. Professional Guidance
An experienced attorney can coordinate with financial planners to ensure compliance with Medi-Cal rules while protecting your interests.
What Happens If You Lose Eligibility?
If your settlement pushes you over Medi-Cal’s asset limit, you may lose coverage temporarily. However, you can reapply once your resources fall below the threshold. Planning ahead can prevent gaps in coverage and unnecessary stress.
Do You Need an Attorney?
Personal injury settlements involving Medi-Cal or Medicaid require careful handling. An attorney can help you:
- Understand reimbursement obligations
- Negotiate liens to reduce repayment amounts
- Structure your settlement to protect benefits
- Avoid costly mistakes that could jeopardize coverage
At Wilshire Law Firm, we offer free consultations and work on a contingency fee basis, which means no fees unless you get paid. Costs and expenses may be your responsibility.
Why Choose Wilshire Law Firm?
- Award-winning legal team with extensive experience in personal injury and benefit-related cases
- Compassionate, confidential guidance for clients navigating complex financial and healthcare issues
- Proven track record of advocating for injured individuals across California
Frequently Asked Questions
Will Medi-Cal take my entire settlement?
Medi-Cal can only recover the amount it paid for your injury-related medical care, subject to certain limits.
Can I refuse to pay Medi-Cal back?
No. Reimbursement is required by law, but your attorney may be able to negotiate the amount.
What if I already spent the settlement?
Failing to address Medi-Cal’s lien can lead to legal consequences. Always consult an attorney before using settlement funds.
Contact Wilshire Law Firm Today
If you have questions about how a personal injury settlement may affect your Medi-Cal or Medicaid benefits, we are here to help. Call us 24/7 for a free consultation.
