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What happens after the death of a beneficiary? Is there a Medi-Cal or Medicaid payback?

In the event of the death of a beneficiary, the funds from a CalABLE account can be used by his or her estate to repay any outstanding eligible expenses, funeral, and burial costs. As part of the estate, funds in the ABLE account are subject to federal estate tax. After the death of the beneficiary, the remaining funds will be taxed and can be used to pay any outstanding qualified disability expenses of the decedent and any State claim under section 529A(f) before they are transferred to the beneficiary's estate or a successor designated beneficiary.

For beneficiaries receiving Medi-Cal benefits: One great benefit of CalABLE is that, in most situations, the account is exempt from Medi-Cal estate recovery, giving individuals the full opportunity to leave a legacy for loved ones.  

Medi-Cal will not file a claim directly on the ABLE account. However, the state may recover on assets that have transferred from an ABLE account to an estate. In these cases, Medi-Cal will recover only if ALL of the following apply:

  • The deceased Medi-Cal member was aged 55 or older.

  • The member leaves an estate that is subject to formal probate. Under current law, only estates that exceed $184,500 in value are subject to formal probate.

  • The member received nursing facility services or home and community-based services, including related hospital and prescription drug services.

  • The member is not survived by a spouse or registered domestic partner, child under 21 years of age, or disabled child of any age.

Recipients of the estate may also apply for a Medi-Cal hardship waiver against recovery on all or part of the estate. Recovery is limited to the amount of payments made for the services listed above (including managed care premiums) or the value of the estate, whichever is less. 

For more information on Medi-Cal and CalABLE, please see the Medi-Cal Program Fact Sheet. 

For beneficiaries receiving Medicaid benefits from a state besides California: Medicaid can file a claim for a payback upon the beneficiary’s death minus any premiums paid as part of the Medicaid Buy-In Program. The Medicaid recovery is calculated from the date the beneficiary opened the CalABLE account. For more information, we recommend contacting your state’s Medicaid program.

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Once you are ready to enroll, you can set up your account here online. When opening a CalABLE account, make sure you have ready identifying information about the beneficiary, the qualifying disability, and how the CalABLE account will be funded.

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Still have questions?

You can contact us online, give us a call Monday through Friday, at 1-833-225-2253 from 6am–5pm PT, or you can browse frequently asked questions.

Individuals with speech or hearing disabilities may dial 711 to access Telecommunications Relay Service (TRS) from a telephone or TTY.

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Consider the investment objectives, risks, charges and expenses before investing in the California 529A Qualified ABLE Program (CalABLE Program). Please call toll-free 833-Cal-ABLE (833-225-2253) or read our Program Disclosure Statement (PDF) containing this and other information. Read it carefully.

Before investing in any ABLE program, you should consider whether your home state provides its taxpayers with favorable state tax or other benefits that are only available through investment in the home state's ABLE program. You also should consult your financial, tax, or other adviser to learn more about how state-based benefits (or any limitations) would apply to your specific circumstances. You also may wish to directly contact your home state's ABLE program, or any other ABLE program, to learn more about those plans' features, benefits and limitations. State-based benefits should be one of many appropriately weighted factors to be considered when making an investment decision.

The CalABLE Program is offered by the State of California. Vestwell State Savings LLC is the program manager. Vestwell Advisors LLC is the investment advisor registered with the Securities and Exchange Commission.

None of the State of California, its agencies, Vestwell State Savings LLC or Vestwell Advisors LLC nor any of their applicable affiliates insures accounts or guarantees the principal deposited therein or any investment returns on any account or investment option, and you may lose the principal amount invested. They also do not provide legal, financial, tax, or investment advice to any individual. The FDIC-Insured Portfolio is FDIC-insured up to $250,000, subject to certain restrictions. Interests in the CalABLE Program are not registered with or in any way approved by the Securities and Exchange Commission or by any state securities commission.

The Plan Web site is for informational purposes only, and does not constitute an offer to sell or solicitation of an offer to buy any security that may be referenced on the site. Such offer or solicitation can be made only through the Disclosure Statement.

The Plan Web site contains links to other Web sites. Neither the Plan nor Vestwell State Savings LLC and its affiliates are responsible for the content of those other Web sites. The accuracy of information on those sites cannot be confirmed.

The Prepaid Card is issued by Sunrise Banks N.A., St. Paul, MN 55103, Member FDIC, pursuant to license from Visa U.S.A., Inc. This card can be used everywhere Visa debit cards are accepted. Use of this card constitutes acceptance of the terms and conditions stated in the Cardholder Agreement.

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