Overview of the Medi-Cal Assisted Living Waiver
The Medi-Cal Assisted Living Waiver (ALW) provides assisted living services for elderly and disabled California residents who require a nursing home level of care, but prefer to reside in an assisted living environment instead of a nursing home. The ALW provides personal care assistance, homemaker services, and home health aides in Adult Residential Facilities (ARFs), Residential Care Facilities for the Elderly (RCFE), and Public Subsidized Housing (PSH). While this waiver is intended to delay / prevent nursing home placements, it also assists current nursing home residents in transitioning to assisted living. Some of the assisted living settings offer memory care, which is specialized care for persons with Alzheimer’s disease or related dementias.
Many waiver programs offer a participant-directed option, allowing program beneficiaries to select their own caregivers, including friends and relatives. The ALW does not. Assisted Living Waiver services are provided by licensed home health agency providers or staff employed by the residential care facility.
The ALW is not available statewide, and currently, is available in 15 CA counties. However, persons can move to an assisted living setting within a county that offers the program.
This waiver is not an entitlement program. This means applicants who meet eligibility requirements are not guaranteed immediate receipt of assisted living services. There are a limited number of participant enrollment slots, and when these slots are full, a waitlist for program participation forms.
The Assisted Living Waiver is a 1915(c) Medicaid waiver. In California, the Medicaid program is called Medi-Cal.
Historically Medicaid only paid for long-term care in nursing homes. 1915(c) HCBS Medicaid Waivers allow states to offer benefits outside of these institutions. “HCBS” stands for “Home and Community Based Services. The goal of HCBS is to delay or prevent institutionalization and to that end, care may be provided in one’s home, the home of a relative, assisted living, or adult foster care / adult family living. Waivers can target specific groups who require a nursing home level of care and are at risk of institutionalization such as the elderly, disabled, or persons with Alzheimer’s. Waivers are not entitlements. This means that meeting eligibility criteria does not guarantee receipt of benefits, as there are a limited number of slots for program participants.
Benefits of the Medi-Cal Assisted Living Waiver
Follows is a list of the benefits available via the Assisted Living Medi-Cal Waiver. An individualized service plan determines which services a program participant will receive, and the frequency with which they are received. Follows is a list of available services:
– Activities – recreational, therapeutic, and social
– Care Management
– Homemaker Services – housekeeping and laundry
– Medication Oversight
– Personal Care – non-medical assistance with daily living activities, such as bathing, dressing, toileting, and eating
– Prepared Meals and Snacks
– Residential Habilitation – one-on-one care assistance with a focus on improving socialization, self-help, and adaptive skills in regards to behavioral issues
– Skilled Nursing / Home Health Aides – on an as-needed basis
– Transitional Assistance – from nursing facility to assisted living
– Transportation / Coordination of Transportation
ALW services are offered in Adult Residential Facilities (ARFs), Residential Care Facilities for the Elderly (RCFE), and Public Subsidized Housing (PSH). This waiver does not cover the cost of room and board in these settings.
Eligibility Requirements for California’s Assisted Living Waiver
The ALW is for California residents who are elderly (65+) or between the ages of 21 and 64 if disabled. Applicants who are nursing home residents must have been there a minimum of 60 days. Applicants must be willing to reside in a CA county that has an assisted living residence that participates in the ALW program. At the time of this writing, ALW services are available in the following California counties:
Financial Criteria: Income, Assets & Home Ownership
The applicant income limit is equivalent to 138% of the Federal Poverty Level (FPL), which increases on an annual basis. In California, the ALW income limits increase in April of each year. From April 2021 – March 2022, a single applicant can have a monthly income up to $1,481. When both spouses are applicants, the income limit is $2,003 / month. When only one spouse is an applicant, the income of the non-applicant spouse is not counted towards the income eligibility of his/her spouse. Only the applicant spouse’s income is considered, which is limited to $1,481 / month. Furthermore, monthly income from the applicant spouse can be transferred to the non-applicant spouse as a spousal income allowance, also called a monthly maintenance needs allowance. The maximum amount that can be transferred is $3,260 / month (effective January 2021 – December 2021) and is intended to ensure the non-applicant spouse has a minimum monthly income of this amount. Non-applicant spouses who have their own income equal to or greater than this amount are not entitled to a spousal income allowance.
As mentioned above, the cost of room and board is not paid for by the Assisted Living Waiver. The amount that a program participant must pay is based on one’s income. In CA, in 2021, state residents who receive SSI and live in an assisted living setting receive a monthly payment of $1,217.37. Of this amount, an individual can retain $138 / month as a personal needs allowance, while the remaining $1,079.37 / month must be paid to the residence for room and board. If an applicant has income over $1,217.37 / month, $1,099.37 / month goes towards room and board and the individual can keep $138 / month.
In 2021, the asset limit is $2,000 for a single applicant. For married couples, with both spouses as applicants, the asset limit is set at $3,000. When only one spouse is an applicant, the assets of both the applicant and non-applicant spouse are limited, though the non-applicant spouse is allocated a larger portion of the assets to prevent spousal impoverishment. (Unlike with income, Medicaid considers the assets of a married couple to be jointly owned). In this case, the applicant spouse can retain up to $2,000 in assets and the non-applicant spouse can keep up to $130,380. This larger allocation of assets to the non-applicant spouse is called a community spouse resource allowance.
Some assets are not counted towards Medicaid’s asset limit. These generally include an applicant’s primary home, household furnishings and appliances, personal effects, and a vehicle.
Assets should not be given away or sold under fair market value within 30-months of long-term care Medi-Cal application. This is because Medicaid has a look back rule and violating it results in a penalty period of Medicaid ineligibility.
The home is often the highest valued asset a Medicaid applicant owns, and many persons worry that Medicaid will take their home. Fortunately, for Medi-Cal eligibility purposes, Medicaid considers the home exempt (non-countable) in the following circumstances.
– The applicant lives in the home or has “intent” to return to the home and indicates it in writing. California is unique from other states in that there is no home equity interest limit. Home equity interest is the current value of the home minus any outstanding mortgage.
– A non-applicant spouse lives in the home.
– The applicant has a dependent relative, such as a disabled child, living in the home.
– The applicant has a child under 21 years of age living in the home.
While the home is likely exempt while one is receiving Medi-Cal benefits, it may not be safe from Medicaid’s estate recovery program. To learn more about when Medicaid can and cannot take one’s home, click here.
Medical Criteria: Functional Need
An applicant must require a nursing facility level of care (NFLOC). For the Assisted Living Waiver, a specialized, electronically scored assessment tool is administered by a registered nurse to determine if this level of care need is met. As part of the assessment, an applicant’s care needs are further determined on a tier level of one to five. Tier one indicates an applicant requires the minimal amount of support provided by the ALW, while a determination of tier five indicates one requires the highest level of support available through the program. An applicant’s ability to independently complete activities of daily living (i.e., transferring from the bed to a chair, mobility, eating, toileting, eating) is one area that is considered during the assessment. Relevant to some persons with Alzheimer’s disease or a related dementia, behavioral problems, such as regular attempts to leave the facility or removal of one’s clothes, are also considered. A diagnosis of dementia in and of itself does not mean one will meet a NFLOC.
Qualifying When Over the Limits
Having income and / or assets over Medicaid’s limit(s) does not mean an applicant cannot still qualify for Medicaid. There are a variety of planning strategies that can be used to help persons who would otherwise be ineligible to become eligible. Some of these strategies are fairly easy to implement, and others, exceedingly complex. Below are the most common.
While Medi-Cal has a share of cost program, the Assisted Living Waiver does not allow applicants to qualify via this program. With a “share of cost”, an applicant with income over Medi-Cal’s income limit has a set amount of income, a “share of cost”, that must be spent on medical expenses and supplies before qualifying for program benefits.
When persons have assets over the limits, trusts are an option. Irrevocable Funeral Trusts are pre-paid funeral and burial expense trusts that Medicaid does not count as assets. Another option are annuities that turns countable assets into a stream of income. There are many other options when the applicant has assets exceeding the limit.
Inadequate planning or improperly implementing a Medicaid planning strategy can result in a denial or delay of Medicaid benefits. Professional Medicaid planners are educated in the planning strategies available in the state of California to meet Medicaid’s financial eligibility criteria without jeopardizing Medicaid eligibility. Furthermore, there are additional planning strategies that not only help one meet Medicaid’s financial criteria but can also protect assets for family as inheritance. These strategies often violate Medi-Cals’s 30-month look back rule, and therefore, should be implemented well in advance of the need for long-term care. However, there are some workarounds, and Medicaid planners are aware of them. For these reasons, it is highly suggested one consult a Medicaid planner for assistance in qualifying for Medicaid when over the income and / or asset limit(s). Find a Medicaid planner.
How to Apply for the Medi-Cal Assisted Living Waiver
Before You Apply
Prior to submitting an application for the Assisted Living Waiver, applicants need to ensure they meet the eligibility criteria (take a test here). Applying when over the income and / or asset limit(s) will be cause for denial of benefits.
As part of the application process, applicants will need to gather documentation for submission. Examples include copies of Social Security and Medicare cards, bank statements up to 30-months prior to application, proof of income, and copies of life insurance policies, property deeds, and pre-need burial contracts. Unfortunately, a common reason applications are held up is required documentation is missing or not submitted in a timely manner.
The Assisted Living Waiver is not an entitlement program and currently has a statewide waitlist for program participation. The ALW is approved for a maximum of 7,409 beneficiaries each year. In some cases, an applicant’s access to a participant slot is based on the immediate need for program services. Persons can contact an Assisted Living Waiver care coordination agency to inquire as to the current average waiting period.
To apply for the ALW, applicants must contact a participating care coordination agency in their county, or the county to which they would like to relocate, to fill out and submit a program application to CA’s Department of Health Care Services. Persons can see a list of participating RCFE’s and ARF’s by city and county here. A list of participating public subsidized housing facilities by city and county can be found here. As part of the application process, a care needs assessment is completed by a registered nurse hired by the care coordination agency. An over-the-phone prescreening is completed first to determine if the individual qualifies for the actual assessment.
When there are no available assisted living beds via the Assisted Living Waiver, applicants should complete a Waitlist Request Form to be put on a statewide waitlist. The care coordination agency will be contacted by CA’s Department of Health Care Services (DCHS) when a participant slot becomes available. The applicant will have 60 days to submit a completed application to DHCS. It is possible that an applicant who currently receives Medi-Cal benefits, but who does not yet meet the functional need for care, be placed on the waiting list for the ALW.
The Assisted Living Waiver is administered by the California Department of Health Care Services (DHCS).
Approval Process & Timing
The Medicaid application process can take up to 3 months, or even longer, from the beginning of the application process through the receipt of the determination letter indicating approval or denial. Generally, it takes one several weeks to complete the application and gather all of the supportive documentation. If the application is not properly completed, or required documentation is missing, the application process will be delayed even further. In most cases, it takes between 45 and 90 days for the Medicaid agency to review and approve or deny one’s application. Based on law, Medicaid offices have up to 45 days to complete this process (up to 90 days for disability applications). However, despite the law, applications are sometimes delayed even further. Furthermore, as a waitlist currently exists for the Assisted Living Waiver, approved applicants may spend years waiting to receive benefits.