The last thing you want after a personal injury settlement is to lose your Medicaid or Medi-Cal benefits. But depending on the amount of compensation you get in your personal injury settlement, you may exceed the income limits that make you eligible for these programs. With personal injury settlements reaching into the hundreds of thousands or even millions of dollars, you might assume that would be enough to keep you covered for the future. But medical treatment is expensive. The financial toll of an injury could last years, if not decades. The more severe your injury, the more intensive your treatment is likely to be. Supportive aids, in-home attendant care, adaptable vehicles, and home modifications can also be costly.
As a result, you want all the help you can get. That includes staying on Medi-Cal so that you can continue getting member benefits and medical coverage.
Avoiding Medicaid/Medi-Cal headaches
If you are injured as a result of someone’s actions, a personal injury settlement or judgment can compensate you for medical bills, expenses, and any time you missed off work. A settlement can be extremely helpful to your recovery – but what does that mean for your government benefits? Do you still remain eligible for Medicaid or Medi-Cal?
Personal injury lawsuits can typically take some time to resolve. Meanwhile, you still need medical treatment that cannot be delayed for the sake of your health. So as your personal injury case proceeds, your health insurance (Medicaid or Medi-Cal) pays for the medical treatment you get.
When you finalize your case with a personal injury settlement or judgment, Medi-Cal will seek reimbursement to cover the expenses they paid on your behalf.
A personal injury settlement can truly be life-changing after your accident. The compensation you get as a result of the accident can pay for the medical treatment you or a loved one needs to recover. In the most severe cases, a settlement can help cover the cost of lifelong supportive or in-home care if you or your injured family member needs it.
Handling the proceeds of your settlement, however, can get tricky with Medi-Cal. Medicaid and Medi-Cal are assistive programs with strict income limits. What happens if you get thousands or even millions of dollars in a settlement?
What Is a Medicaid or Medi-Cal Lien?
California law gives Medi-Cal the right to get reimbursed from personal injury settlements.
In fact, any Medi-Cal member filing a personal injury lawsuit must notify the California Department of Health Care Services’ (DHCS) Personal Injury Program within 30 days. A good personal injury lawyer will know how to take care of this important step for you.
As soon as you notify the DHCS, you start the process of creating a Medi-Cal lien. A lien gives the government the right to collect – a kind of I.O.U. to be paid at a later time. This lien allows Medi-Cal to get refunded from your settlement for any payments made up to that point.
You are also required to notify the DHCS when you get your settlement and when your medical treatment ends. Again, your attorney can take care of the notification process.
Under California law, the DHCS can recover Medi-Cal payments up to the date of your settlement or once all legal actions related to your injury are completed. After that, you can create a special needs trust out of which future payments will be taken.
A Medi-Cal lien can affect only the part of your settlement that compensates you for medical expenses. So it cannot affect any damages you get for lost wages or pain and suffering. The lien is limited by the original amount Medi-Cal paid for your treatment. In addition, the DHCS has the power to compromise, settle, or waive its lien claim. For example, Medi-Cal’s claim may be reduced if you have attorney’s fees or litigation costs.
Ultimately, California rules allow Medi-Cal to take no more than 50% of your settlement.
If you fail to notify the government that you’re filing a lawsuit, the DHCS can take legal action against you to get reimbursements for Medi-Cal. This can lead to more time in court – and cost you a lot more than simply taking the right approach the first time around. A knowledgeable personal injury attorney can guide you in the right direction.
How to Stay Eligible for Medi-Cal After a Personal Injury Settlement
A good personal injury lawyer will help you not just win your case but also plan for a sound financial future. That involves keeping your Medi-Cal benefits and helping you pay your expenses with your settlement money in the long term. This could mean spending down your settlement proceeds (not always the best option) or creating a special needs trust.
Your personal injury lawyer can help you manage your settlement payout in a way that:
- Keeps you eligible for Medicaid and Medi-Cal government benefits,
- Cuts down on the fines you must pay out of your settlement, and
- Sustains your treatment long-term as much as necessary.
This ensures you get the greatest possible benefit out of your settlement.
A special needs trust holds onto your money for you without those resources counting towards your income. As a result, the money in the trust won’t exceed Medi-Cal income limits. You can continue using money from the trust to pay for any medical expenses beyond what your Medi-Cal coverage pays. Your attorney can help you set up the trust properly.
You shouldn’t have to choose between getting the settlement you deserve and keeping an important benefit like Medi-Cal coverage. After all, if your injury was caused by someone else, you are an innocent party. You should not be on the hook for someone else’s negligence.
Talk to us— We can help!
If you or someone you know has suffered a life-changing injury as a result of a car accident, you should not hesitate to contact an attorney as soon as possible. At Wilshire Law Firm, we don’t just fight for our clients in court – we also make sure they get the medical and physical treatment they need to recover.
You shouldn’t have to pay to recover from an injury caused by someone else, and that’s where our hard-working personal injury lawyers come in. We offer a 24/7 FREE case consultation and absolutely NO fees unless you win. If you’d like to contact us, feel free to call today at (877) 544-0852. You can also reach us at our online form, or via our instant chat button on your screen.