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Legal-Ease: An Attorney’s Perspective: Making Ends Meet

By March 22, 2019April 5th, 2019No Comments

Judd Matsunaga

Here’s a frightening statistic: More than 25 million Americans aged 60-plus are economically insecure, which means that millions of seniors struggle to meet their monthly expenses, even though they live above the federal poverty level of $29,425 per year for a single person and are not considered “poor.”

Furthermore, 1 in 7 seniors have no retirement savings whatsoever (Source: The National Council on Aging). These older adults struggle with rising housing costs and health-care bills, inadequate nutrition, lack of access to transportation, diminished savings and job loss (Source:

On average, older women received about $4,500 less annually in Social Security benefits in 2014 than older men due to lower lifetime earnings, time taken off for caregiving, occupational segregation into lower wage work and other issues. Older women of color fared even worse (SSA, 2015).

Imagine pitching your tent on the edge of a cliff — one major adverse life event would push you over. That is an everyday struggle for seniors who are living near the poverty level. For example, the loss of a spouse could mean a 50 percent loss of income. It’s no wonder that many seniors are all stressed-out.

Unfortunately, Medicare is not a fix-all program for the elderly. Medicare will not cover all your medical costs. If you get sick, the out-of-pocket expenses for your medical care can be quite extensive. In fact, studies estimate that 1 in 5 seniors skipped seeing their doctor because of high out-of-pocket costs.

We all know that seniors can face huge hits to their pocketbooks from health-care costs. According to a report by the Employee Benefits Research Institute, in 2011, the average out-of-pocket household cost of health care for seniors 85 and older was $6,603, constituting 19 percent of total household expenses.

Nursing-home stays place a particularly big financial burden on the elderly. Of those 85 and older, 62.3 percent had stayed in a nursing home overnight before death, and 51.6 percent were living in a nursing home before death. For people in that age group, during a two-year period, the average cost of a nursing-home stay was $24,185.

Now, I’m not a financial planner, but I did graduate from UCLA with a Bachelor of Arts degree in economics. So, if you’re struggling to make ends meet, I know there’s only two possible solutions: (1) increase your income; or (2) reduce your spending. There are two public programs that might help you do both.

In my article “What Is In-Home Supportive Services” (Pacific Citizen, July 2018), I discussed how to increase your income by qualifying for a little-known public program called “In Home Supportive Services.” IHSS will send you money each month if you can first qualify for Medi-Cal.

Now, I want to address how to reduce your spending. The answer is the same: Qualify for Medi-Cal. Other patients, who go to the same doctors and pharmacists that you go to, will pull a white card with “State of California” on it. That’s a Medi-Cal card. No more “co-pays.” You are now “Medi-Medi,” i.e., Medicare and Medi-Cal.

You can qualify for Medi-Cal and keep your home, your income, your savings, retirement accounts and your car, even if your loved one is already in a nursing home. If you were told you have too many assets to qualify, you may convert nonexempt assets into exempt assets. If you were told the state will take your house, there are legal ways to protect your home.

You may also “spend-down” excess assets to qualify for Medi-Cal. For example, you can pay off your mortgage, remodel or repair your home, buy new furniture, pay off other bills and debts and/or buy new clothing or medical equipment. You may also buy a new car even if you don’t drive.

But, be careful! Medi-Cal uses a 30-month “look-back” period to determine if a Medi-Cal applicant made an “improper” transfer. This doesn’t mean that every gift you made in the previous 30 months will result in a penalty. You can still give away or transfer property and be eligible for Medi-Cal depending on when the gift was made and how much you gave away.

Simply put, even if you have been told you have too much money to qualify for Medi-Cal, you can legally gift away excess money if 
done properly. The rules are very tricky. It would be advisable not to gift or transfer any assets away without first consulting with an attorney with experience in Medi-Cal qualifications.

Judd Matsunaga is the founding attorney of Elder Law Services of California, a law firm that specializes in Medi-Cal Planning, Estate Planning and Probate. He can be contacted at (310) 348-2995 or The opinions expressed in this article are the author’s own and do not necessarily reflect the view of the Pacific Citizen or JACL. The information presented does not constitute legal or tax advice and should not be treated as such.