Table of Contents
Background
In July 2021, California passed a law to eliminate the state’s Medi-Cal asset limit for Medi-Cal programs for older adults and people with disabilities.[1] This change occurred in two steps: first, effective July 2022, the asset limit was increased to $130,000 for an individual (plus $30,000 for each additional household member). Second, effective January 2025, the asset limit was fully eliminated. Prior to July 2022, to qualify, older adults and people with disabilities had to have assets below $2,000 for full Medi-Cal and under $8,400 to be eligible for Medicare Savings Programs (MSPs), and had to prove their assets each year to remain eligible.
California was the first in the nation to eliminate assets for all Medi-Cal enrollees, leaving income the sole financial criteria for Medi-Cal eligibility. The state did so in recognition that asset limits are restrictive, forcing older adults and people with disabilities to live in deep poverty to access essential care, and decreasing long-term economic security. The elimination also made it easier for eligible people to enroll and remain enrolled and to save for an emergency. Read more here about the positive impacts that eliminating the asset limit had on low-income older adults and people with disabilities.
In June 2025, citing budgetary constraints, California reinstated the Medi-Cal asset limit to $130,000 for older adults and people with disabilities effective January 1, 2026.[2] Each additional person in the household will increase the asset limit by $65,000. Upon reinstatement, older adults and people with disabilities will again be required to document their assets, but not until their first annual renewal, in 2026. People over the new limit are not eligible for Medi-Cal benefits and will have their coverage terminated. New Medi-Cal applicants must meet the reinstated asset limit to qualify for coverage.
With asset limits being reinstated, advocates working with older adults and people with disabilities will need to know why the rules are changing and what older adults and people with disabilities will need to do to remain on Medi-Cal.
Asset Limit Reinstatement FAQs
When will the asset limit apply?
Starting January 1, 2026, the asset limit will be $130,000 for persons enrolled in Medi-Cal programs with an asset test (see next question). Each additional person in the household will increase the asset limit by $65,000.
Which Medi-Cal programs will have an asset limit?
A: All non-expansion Medi-Cal programs, including the Aged, Blind, and Disabled program, Medi-Cal with a Share of Cost (medically needy), 250% Working Disabled Program, Long-Term Care, and Medicare Savings Programs (MSPs). MSPs include four specific programs: Qualified Medicare Beneficiary (QMB), Specified Low-Income Medicare Beneficiary (SLMB), Qualified Income (QI), and Qualified Disabled Working Individual (QDWI) programs. MSPs help low-income Medicare enrollees pay for Medicare out-of-pocket expenses including premiums and cost-sharing. The complete list of Medi-Cal programs impacted by reinstatement are listed here.
Note: Younger adults and children enrolled in Medi-Cal expansion categories do not have an asset limit. People on Supplemental Security Income (SSI) linked Medi-Cal must meet the SSI $2,000 asset limit.
What do current Medi-Cal enrollees need to do?
If someone has Medi-Cal benefits now, they do not need to take any action. Current enrollees will need to verify their assets at their first Medi-Cal renewal in 2026. Current enrollees do not need to report assets before their first renewal unless they otherwise report a change in circumstance (such as a change in income or household size).[3] Medi-Cal enrollees must comply with the Medi-Cal renewal process and if asked, submit proof to demonstrate that their assets are below $130,000 to maintain Medi-Cal eligibility in 2026. Medi-Cal enrollees should update their address if they moved so the county Medi-Cal office has their correct address in case they mail any notices or requests for information.
For example, if a person’s Medi-Cal annual renewal date is in April 2026, their assets will be verified in the renewal process leading up to April 2026. They do not need to report or verify assets earlier than their renewal date if they otherwise did not have a change in circumstance.
People newly applying for Medi-Cal benefits after January 2026 must report their assets in their application. If countable assets are over $130,000 for a single person, the Medi-Cal application will be denied.
What assets are counted for Medi-Cal?
The former rules on countable and exempt assets that were in place prior to 2024 will apply after reinstatement.[4] Countable assets include cash, money in a banking account, second vehicles, or a home or land that the person does not live in. One home is exempt as an asset if the Medi-Cal applicant or recipient lives in the home. Second homes are counted.
Other assets that are not counted towards the asset limit include one vehicle or personal items, such as televisions, or other household items. Retirement account balances are exempt as an asset if regular distributions are received. The distributions are considered income and countable. See the Medi-Cal General Property Limitations, MC 007 for more information on countable assets.
What if an enrollee has assets over the $130,000 limit?
Enrollees living in the community. If an enrollee currently has assets over $130,000 and lives in the community, they can spend down their assets to meet the $130,000 limit prior to your renewal date to remain Medi-Cal eligible. A few examples include spending money on repairs for the home, updating furniture, prepaying rent, paying off car loans, or giving assets to other individuals. If an enrollee has assets over $130,000 at the time of their renewal, their Medi-Cal coverage will be terminated.
Enrollees enrolled in Long-Term Care Medi-Cal, for nursing facility stays. People who live in Medi-Cal- paid long-term care facilities or who might need Medi-Cal- paid long-term care for a nursing facility stay in the future, must be careful in how they “spend down” or transfer nonexempt assets. Impermissibly transferring nonexempt assets for less than fair market value, like giving away cash in excess of $130,000, can result in being ineligible for Medi-Cal- covered long-term care for a period of time.[5] Medi-Cal can look back up to 30 months to determine if someone impermissibly transferred nonexempt assets before requesting Medi-Cal- paid long-term care.[6] See the California Advocates for Nursing Home Reform resource for more information. Again, if an enrollee is over the asset limit at the time of their renewal, their Medi-Cal coverage will be terminated.
What if a person transferred assets before January 2026?
Any transfer of assets made between January 1, 2024 and December 31, 2025 will not be considered in eligibility renewals in 2026. Assets were not considered during this time period so what a person did with their assets during this time cannot be counted against them.[7] Medi-Cal enrollees must not be asked for any proof of asset transfers and what was done with the money during this period.
Will the asset limit reinstatement impact Spousal Impoverishment Protections for long-term care?
Yes. The institutionalized spouse can keep up to $130,000 in assets and the community spouse can keep assets up to the current Community Spouse Resource Allowance. See Justice in Aging’s Spousal Impoverishment fact sheet.
What notices and materials will people receive?
The Department of Health Care Services (DHCS) mailed an outreach notice and resource on frequently asked questions to all people enrolled in programs impacted by the Medi-Cal asset limit reinstatement. The outreach notice informs people of the upcoming change in 2026, which assets are counted and which are exempt, and what actions people must take, if any. See the Medi-Cal Eligibility Division Information Letter (MEDIL) 25-23 for copies of the outreach notices and frequently asked questions. These notices were mailed in October 2025.
What if I have Supplemental Security Income (SSI) linked Medi-Cal? What if I have CalFresh benefits?
The asset limit changes apply only to Medi-Cal programs. The reinstatement of the Medi-Cal asset limit does not change cash assistance rules or other public benefit programs such as SSI or CalFresh. People who receive SSI or other cash assistance must continue to meet the lower asset limit for these programs.
What about Deemed SSI groups?
Deemed SSI groups, including Pickle, Disabled Adult Child(ren) (DAC) and Disabled Widow(ers) (DWW) receive Medi-Cal directly and not through linkage from another public benefit, such as SSI. These three groups will not be subject to the asset limit reinstatement in January 2026. California used separate federal authority to eliminate assets for the Deemed SSI groups and must submit an 1115 waiver amendment to reinstate assets for the Deemed SSI groups.[8] It is expected that California will eventually reinstate the asset limit for these groups, but has not done so to date.
What about older immigrants without status?
Undocumented immigrants enrolled in aged and disability based Medi-Cal categories[9] will also have to comply with the reinstated asset limit, as well as other eligibility changes enacted in the 2025-2026 budget. This group must pay monthly premiums beginning July 2027 and will lose Medi-Cal dental coverage beginning July 2026.[10] There is also a freeze on new enrollment of undocumented immigrants applying for Medi-Cal starting January 1, 2026.[11] Current enrollees who are undocumented must maintain Medi-Cal coverage and meet eligibility requirements, including income and asset limits. The termination of Medi-Cal benefits for more than 3 months could prevent re-enrollment.[12] To learn more, please see MEDIL 25-22 for more information.
Will Medi-Cal income limits change?
No, income limits are not impacted by the asset limit reinstatement. The asset limit reinstatement does not change other Medi-Cal eligibility rules, including income levels or what is countable income. Medi-Cal income limits adjust every year based on changes to the Federal Poverty Levels.
What about Estate Recovery?
Estate recovery is unchanged and continues to apply. Federal law requires Medicaid (Medi-Cal in California) agencies to recoup payments for certain Medi-Cal benefits, long-term care, and home and community-based services for some Medi-Cal enrollees. The reinstatement of the Medi-Cal asset limits will not impact or prevent Medi-Cal estate recovery. For more information on estate recovery, see the Department of Health Care Service’s website and California Advocates for Nursing Home Reform’s Medi-Cal recovery information guide. For information about the harms of Medicaid Estate recovery read Justice in Aging’s Issue Brief: How Medicaid Estate Recovery Perpetuates Poverty.
What about the home equity limit for long-term care?
The home equity limit does not apply in California yet. Under H.R.1, California must implement the home equity limit by January 1, 2028. To learn more about the home equity limit, please read our H.R.1 Explainer.
Additional Resources
- Department of Health Care Services (DHCS) Materials:
- For free, legal advice and counseling on the Medi-Cal Asset Limit Elimination, contact the Health Consumer Alliance at 1-888-804-3536; TTY 1-877-735-2929
Endnotes
Assembly Bill 133, adding WIC § 14005.62 (July 27, 2021). ↑
2025-26 Health Omnibus Bill, Assembly Bill (AB) 116 Section 59. ↑
See 22 CCR § 50401 et seq. ↑
22 CCR § 50408; ACWDL 25-18. ↑
See Section 88 of AB 116; ACWDL 25-18. ↑
Deemed SSI groups are individuals who would be eligible for Medi-Cal if they were receiving Supplemental Security Income (SSI) and/or state supplementary payments (SSP) but are no longer receiving such payments and are thus “deemed” eligible for Medi-Cal. California cannot use 1902(r)(2) authority to disregard assets for these groups and submitted an 1115 waiver amendment. See CalAIM Approval Letter and STCs for Asset Test Amendment (June 2022). ↑
Undocumented immigrants placed in any of the listed Medi-Cal aid codes in ACWDL 25-14 will be subject to the asset limit after January 2026. ↑
See ACWDL 25-13; ↑
Id. ↑
MEDIL 25-22, pg. 7. ↑
