Medi-Cal Getting Health and Dental Care, Income, and Fraud Questions

New Medi-Cal Information Brochure

The Medi-Cal encompasses a variety of different programs, just not the MAGI Medi-Cal applied for through Covered California. The myMedi-Cal brochure is a high-level overview with an emphasis on MAGI Medi-Cal. Major sections include

Health Coverage in California Applying for Medi-Cal How to use Medi-Cal benefits Covered Medi-Cal services Retroactive Medi-Cal Reporting changes and renewing Medi-Cal Rights and responsibilities of the Medi-Cal beneficiary

There is a nice description of MAGI versus Non-MAGI Medi-Cal. MAGI (Modified Adjusted Gross Income) Medi-Cal is California’s version of expanded Medicaid under the ACA. Non-MAGI, sometimes referred to as conditional Medi-Cal, covers all the other programs for women who are pregnant, blind, disabled, caretaker, and assistance for Medicare beneficiaries. The significant difference is that MAGI Medi-Cal only looks at household income. Whereas Non-MAGI also considers assets and property.

myMedi-Cal goes through the flow of enrollment where the beneficiary first receives the State of California Benefits Identification Card. The new enrollee can use Medi-Cal right away under the Fee-For-Service provisions, but the care must be through an approved Medi-Cal provider, excluding emergency services. Then, the Medi-Cal beneficiary will be transitioned to a managed care HMO plan operating in their county. The brochure also explains the Share of Cost (SOC) that a beneficiary may have to pay for health care or dental services.

Perhaps under emphasized, the Updating and Renewing Medi-Cal section reminds people they must report any changes to Medi-Cal within 10 days. The changes include marital status, receiving other health care insurance, income, household dependents, and citizenship to name a few items that must be reported to Medi-Cal. Particularly important is if the beneficiary moves, especially to another county. Each California county administers eligibility and enrollment into Medi-Cal. Not all HMO plans are available in each county. If the beneficiary moves, they may have to change health care plans.

The brochure also outlines the rights and responsibilities of the Medi-Cal beneficiary. Eligibility determinations, either enrollment or termination, can be appealed. myMedi-Cal discusses the time periods for the appeals and the right to a State Fair Hearing.

Medi-Cal Income and Deduction Changes

The Department of Health Care Services also publishes guidance to County Welfare Directors in the form of letters. One letter released on May 15, 2019 reviews the changes to income and deductions pertinent to MAGI Medi-Cal. These changes were a result of the 2017 federal Tax Cut and Jobs Act (TCJA).

The TCJA eliminated some income and deduction allowances for calculating income for Medi-Cal eligibility.

Tuition and Fees: Effective January 1, 2019, counties shall no longer allow tuition and fees as a deduction in determining eligibility for MAGI Medi-Cal and shall wait until the next annual redetermination, or reported change in circumstance, and confirm that any existing deduction records in the Statewide Automated Welfare System (SAWS) were end dated.

Moving Expenses: Effective January 1, 2019, counties shall only allow moving expenses as a deduction for MAGI Medi-Cal if the applicant or beneficiary self-attests to having moving expenses as an active duty military personnel moving due to a change of station.

Alimony Income and Deductions: Effective January 1, 2019, alimony will no longer be counted as income or allowed as a deduction for MAGI Medi-Cal if the divorce or separation instrument execution date, or modification date, is on or after January 1, 2019. The taxable portion of alimony income and deductions will continue to be included in the MAGI eligibility determination for individuals with a divorce or separation instrument execution date on or before December 31, 2018.

Self-Employment Deductions: Effective January 1, 2019 entertainment expenses are no longer an allowable self-employment deduction. The IRS updated the 2018 Schedule C tax form to reflect the change to the tax law and CEWs may continue to use the document for verification of self-employment income. If a previous year’s Schedule C (tax year 2017, or prior) is submitted as verification of income, the CEW shall deduct any expense deductions for entertainment.

Reporting Medi-Cal Overpayments and Fraud

Another letter issued to County Welfare Directors on January 25, 2019, was a reminder of the statutes regarding overpayments and fraud.

Counties shall review for potential overpayments for both the Modified Adjusted Gross Income (MAGI) and Non MAGI Medi-Cal programs. Review this section of the MEPM and the examples provided prior to completing a potential overpayment referral.

The letter refers to the definition of fraud, “Fraud is defined in CCR Title 22, Section 50782 and Article 16F of the MEPM.”

Section 50782: Fraud occurs if an overpayment occurs and the beneficiary or the person acting on the beneficiary’s behalf willfully failed to report facts as specified in Section 50781(a) with the intention of deceiving the Department, the county department or the Social Security Administration for the purpose of obtaining Medi-Cal benefits to which the beneficiary was not entitled.

The letter notes that states must have an electronic Asset Verification Program in place, limited to applicants who are blind, aged, or disabled. The verification program is to detect unreported assets for the category of beneficiaries listed who are not receiving Supplemental Security Income and/or State Supplementary Payments. However, as the letter highlights, Medi-Cal has many different programs that cover a variety of household situations. As the letter states,

…before calculating a potential overpayment for any Medi-Cal case, it is essential to consider the possibility that individuals in the case may be eligible for Medi-Cal through another program. For example, one or more members may be eligible for Medi-Cal with a SOC while other members may be eligible for MAGI Medi-Cal.

Since Medi-Cal programs can have different income or property rules, a potential overpayment for any Medi-Cal case may not apply to all individuals in that case. This could mean that no potential overpayment would even exist for some members. Therefore, counties shall determine if an individual has eligibility under any other Medi-Cal program before computing a potential overpayment and making a referral it to DHCS.

This underscores the importance that Medi-Cal beneficiaries must work closely with their County Eligibility Workers to properly document all of their income, assets, and household relationships and situation. When Medi-Cal has all the necessary information, they can make proper eligibility determinations and avoid any action that may flag a claim as fraudulent.

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