Last summer we announced the good news that the Governor signed AB 715 into law, effectively ending the “senior penalty” by raising the income limit for Medi-Cal’s Aged & Disabled program from 123% to 138% of the federal poverty level. This change would allow another close to 30,000 older Californians to receive full Medi-Cal. The new income limit was supposed to go into effect as of August 1, 2020, but has been delayed to December 1, 2020.
Why ending the “senior penalty” is important
Due to the Affordable Care Act, most adults in California can qualify for full Medi-Cal with incomes up to 138% of the poverty level ($1,436/month for an individual). Yet, when someone turns 65, they must get their Medi-Cal through the Aged & Disabled program. And to get full Medi-Cal through this program, they can only have incomes up to 123% of the federal poverty level. If someone’s income is even just $1 above the 123% limit, they will have Medi-Cal with a Share of Cost, and be required to spend hundreds of dollars first before their Medi-Cal coverage would kick in.
This means that at 64 years of age, someone could qualify for full Medi-Cal, yet after turning 65, only be eligible for Medi-Cal with a large Share of Cost.
Having Medi-Cal with a Share of Cost can impose a significant financial hardship. For example, as explained in Justice in Aging’s tip sheet on AB 715, a share of cost is the difference between a person’s countable income and the Maintenance Need Income Level (MNIL), or what the state considers to be the base amount of income a person needs to survive on a monthly basis. Yet, the MNIL in California is $600 per month and has not changed since 1989. Every dollar of income a person has over $600 a month (or a married couple, over $934), becomes that person’s share of cost. For example, a 65 year-old with a monthly income of $1,300 would have a $700 share of cost. If that same individual were 64, she would be eligible for free Medi-Cal without a share of cost.
With such a large Share of Cost, many older adults are forced to chose between health care and rent or food. Therefore, ending the “senior penalty” and raising the income limit of Medi-Cal’s Aged and Disabled program to that of it’s other adult programs at 138% of the federal poverty level is extremely important, especially during a pandemic.
We are working with our advocacy partners to help make sure this implementation of AB 715 is not further delayed and will keep you updated.
For more information on ending the senior penalty, see Justice in Aging’s AB 715 tip sheet.