California Just Reinstated Medi-Cal Asset Limits – See the New Rules

Instant Answer: Yes, Asset Limits Are Back for Some Medi-Cal Recipients

If you are 65 or older, have a disability, live in a nursing home, or are in a family that makes too much money for tax-based Medi-Cal, California reinstated asset limits starting January 1, 2026 .

Here’s what changed: Between 2024 and 2025, California had no asset limit for these groups. That meant you could have savings, a second car, or investments and still qualify. As of January 2026, the asset limit is back at **$130,000 for an individual**, increasing by $65,000 for each additional household member (up to 10 people) .

What this means in real life: An 80-year-old widow with $200,000 in savings, a paid-off home, and one car qualified for Medi-Cal in 2024 and most of 2025. On January 1, 2026, she must report those assets. If her countable assets exceed $130,000, she may lose Medi-Cal coverage at her next renewal.

The bottom line: If your assets are under these limits, you’re fine. If you’re over, you need to act before your renewal date.

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What Americans Need to Know Right Now

This only affects specific groups. If you get Medi-Cal through the expansion for adults 19-64 (based solely on income, no asset test), nothing changed for you . The asset limit applies to “Non-MAGI” Medi-Cal – seniors 65+, disabled individuals, nursing home residents, and families who exceed income for tax-based rules <span class=””>.

Existing beneficiaries aren’t cut off immediately. Current Medi-Cal members will face the asset test at their next annual renewal in 2026 – not on January 1 . That gives you time to plan.

New applicants after January 1, 2026 must report assets immediately .

Some programs are completely exempt. The Pickle, Disabled Adult Child (DAC), and Disabled Widower (DW) Medi-Cal programs do NOT have to report assets at all . If you’re in one of these, you’re safe.

Florida and other states are moving in the opposite direction. Florida proposed increasing asset limits for developmentally disabled workers to $13,000 for individuals and $24,000 for couples . Connecticut is phasing out asset limits entirely by 2030 . So California’s move stands out.

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Latest Updates Today on Medi-Cal Asset Limits

As of January 1, 2026, the asset limit is officially reinstated for Non-MAGI Medi-Cal programs in California .

DHCS issued guidance on implementation via All County Welfare Director’s Letter (ACWDL) 25-14 on June 30, 2025 . Counties are now required to:

• Collect asset information from new applicants immediately

• Apply asset tests at annual renewals for existing members

• Calculate potential overpayments for excess assets, but NOT for the period January 1, 2024 through December 31, 2025 (the “no asset limit” period) 

The federal landscape is shifting too. The “One Big Beautiful Bill Act” (OBBBA) passed in 2025 cuts approximately $1 trillion from Medicaid nationally. Starting **January 1, 2028**, a new federal home equity limit of **$1,000,000** will apply for long-term care Medicaid eligibility . This is a federal ceiling – states can set lower limits, but not higher.

Spousal protections updated for 2026. For married couples where one spouse needs long-term care Medicaid, the Community Spouse Resource Allowance (CSRA) in 2026 is:

• Maximum: $162,660

• Minimum: $32,532

• Penalty divisor: $421.20 per day ($12,811.50 per month) 

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Who Qualifies – And Who’s Affected by Asset Limits

Affected by the 2026 Asset Limit Reinstatement

You are subject to Medi-Cal asset limits starting in 2026 if:

• Age 65 or older AND meet Medi-Cal household income limits 

• Have a disability (physical, mental, or developmental, as determined by Social Security standards) 

• Live in a nursing home or receive long-term care services 

• Are in a family that makes too much money to qualify using federal tax filing rules 

NOT Affected (No Asset Test)

• Adults aged 19-64 on expansion Medi-Cal (MAGI-based) – income-only test 

• Pickle Program beneficiaries (people who lost SSI due to COLAs but kept Medi-Cal) 

• Disabled Adult Child (DAC) recipients 

• Disabled Widower (DW) program participants 

• Children and pregnant women (different rules apply)

Out-of-State Context

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Asset Limits: How Much You Can Have

California Medi-Cal Asset Limits (Effective January 1, 2026)

Note: Limits apply to countable assets only (see next section for what counts vs. doesn’t count).

What Counts as an Asset

Countable assets include: 

• Bank accounts (checking, savings, CDs)

• Cash

• Second vehicles (cars, boats, RVs)

• Second homes or investment properties

• Stocks, bonds, mutual funds

• Investment accounts

What Does NOT Count (Exempt Assets)

NOT counted toward the limit: 

• Your primary home (where you live) – no equity limit (for now; federal $1M limit starts 2028) 

• One vehicle per household

• Household items (furniture, appliances, clothing)

• Retirement accounts (IRAs, 401(k)s, pensions) – if you’re receiving Required Minimum Distributions or periodic payments 

• Life insurance policies with face value of $1,500 or less 

Married Couples and Spousal Protections

For married couples where one spouse needs long-term care Medicaid (institutional or home-based):

• Community Spouse Resource Allowance (CSRA) for 2026:

  • Maximum: $162,660

  • Minimum: $32,532 

How it works: All countable assets of the couple are totaled and divided in half. The community spouse (the one not applying for care) can keep up to the maximum allowance. The spouse needing care must spend down their share to very low levels.

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How This Affects Your Medi-Cal Coverage

Timeline for Current Beneficiaries

Finding Your Renewal Date

• Check your BenefitsCal account online

• Contact your county Medi-Cal office

• Look for renewal notices in the mail

What Happens if You’re Over the Limit

1. You may be discontinued from Medi-Cal

2. You might qualify for a share-of-cost (spend-down) program instead of full Medi-Cal

3. Counties will calculate potential overpayments for periods after Jan 1, 2026 if you had excess assets 

BUT: Counties will NOT consider overpayments for the period January 1, 2024 through December 31, 2025 – because there was no asset limit then .

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How to Apply or Update Your Information

For New Applicants (on or after Jan 1, 2026)

Step 1: Determine if you’re in an affected group (65+, disabled, nursing home, or over-income for MAGI)

Step 2: Gather asset documentation:

• Bank statements (all accounts)

• Vehicle registration(s) – multiple vehicles must be reported

• Property deeds (other than primary residence)

• Investment account statements

• Cash value life insurance policies

Step 3: Complete your application through:

• BenefitsCal (online) – fastest method

• County Medi-Cal office (in person or by mail)

• Covered California (for MAGI programs – no asset test)

Step 4: Submit verification with your application. Incomplete applications will be delayed.

For Current Beneficiaries Approaching Renewal

Step 1: Find your renewal date (BenefitsCal or county office)

Step 2: Before renewal, review your assets. If you’re over the limit, you have options:

• Spend down countable assets (pay down debt, make home repairs, prepay funeral expenses)

• Convert countable assets to exempt assets (home improvements, vehicle replacement)

• Transfer to a spouse (under spousal impoverishment rules)

Step 3: At renewal, report all assets honestly. Hiding assets is fraud.

Step 4: If discontinued, ask about share-of-cost Medi-Cal or appeal the decision.

Important: No Mid-Renewal Asset Reporting Required

You are NOT required to report assets at a change in circumstance (CIC) unless your county asks. Counties will attempt to verify assets automatically .

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Common Mistakes That Could Cost You Coverage

Mistake #1: Assuming nothing changed because you had Medi-Cal in 2025. The asset limit is back as of January 1, 2026. Even if you’ve had Medi-Cal for years, your assets will be reviewed at your next renewal.

Mistake #2: Not knowing your renewal date. If you miss your renewal or fail to submit asset information, you could lose coverage. Mark your calendar.

Mistake #3: Counting your home as an asset. Your primary residence does NOT count toward the $130,000 limit. This is the biggest source of confusion.

Mistake #4: Forgetting about second vehicles. One car is exempt. A second car, boat, or RV counts as an asset. Many people don’t realize this.

Mistake #5: Giving away assets to qualify. Medicaid has a 5-year lookback period for long-term care. Transfers for less than fair market value can trigger penalties – periods of ineligibility calculated using the $421.20/day penalty divisor .

Mistake #6: Assuming all retirement accounts are exempt. Your IRA or 401(k) is exempt only if you’re already receiving Required Minimum Distributions or periodic payments . Otherwise, it may count as an asset.

Mistake #7: Ignoring the federal changes coming in 2028. Starting January 1, 2028, home equity over $1,000,000 will count as an asset for long-term care Medicaid nationally . If your home is worth more than that, start planning now.

Mistake #8: Falling for “asset protection” scams. Anyone promising to “hide” your assets to qualify for Medi-Cal for a fee is likely selling something illegal or ineffective. Consult a legitimate elder law attorney.

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What This Means for Families in Real Life

For a 70-year-old retiree living alone: You have $150,000 in savings, a home worth $500,000, one car worth $15,000, and an IRA worth $200,000 that you’re not yet withdrawing from. Countable assets: $150,000 (savings) exceeds the $130,000 limit. Your home and car are exempt. Your IRA may count if not in payout status. You could lose Medi-Cal unless you spend down $20,000+.

For a disabled adult living with parents: You receive SSDI and have $10,000 in a bank account. Your parents’ assets don’t count – only YOUR assets matter for your own Medi-Cal eligibility. You’re well under the $130,000 limit. But you need to prove your disability status.

For a married couple, both 68: They own a home (exempt), one car (exempt), have $250,000 in joint savings, and each has an IRA. If one spouse needs nursing home care, the community spouse can keep up to $162,660. The remaining assets must be spent down. Plan ahead – don’t wait for a crisis.

For someone in the Pickle Program: You lost SSI due to Social Security COLAs but kept Medi-Cal. You are EXEMPT from asset limits entirely. No need to report assets. But confirm your Pickle status with your county.

For a Florida resident with a developmentally disabled adult working: New proposed legislation would allow up to $13,000 in assets (or $24,000 for couples) while keeping Medicaid for disability employment programs . This is significantly higher than traditional limits.

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Government and Political Context Behind the 2026 Changes

Why California reinstated asset limits: In 2024, California eliminated asset limits entirely for seniors and disabled residents – a landmark policy. But the federal budget picture changed dramatically with the passage of the “One Big Beautiful Bill Act” (OBBBA) in 2025. This federal law cuts approximately $1 trillion from Medicaid nationally, with an estimated 10 million people losing coverage .

California faced a choice: implement new state-level asset limits or lose federal matching funds. The state chose reinstatement.

The political debate: Supporters of asset limits argue that taxpayers shouldn’t subsidize health insurance for people with significant savings. Opponents say asset limits punish people who saved responsibly – and that the administrative cost of tracking assets often exceeds the savings.

What’s different this time: The 2026 asset limit ($130,000 individual) is dramatically higher than the pre-2022 limit of **$2,000 for an individual** . In practice, most middle-class seniors with moderate savings will still qualify. The limit primarily affects wealthier individuals.

Federal home equity changes coming in 2028: Starting January 1, 2028, federal law will impose a **$1,000,000 home equity limit** for long-term care Medicaid eligibility <span class=””>. Previously, there was no federal limit. States can set lower limits, but not higher. If your home is worth over $1 million and you need nursing home care, you’ll need to spend down or sell.

State-by-state variation: 

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FAQ Section

Who qualifies for Medi-Cal under the new asset rules?

If you’re 65+, disabled, or in a nursing home, you must meet both income AND asset limits – $130,000 for an individual, $195,000 for a couple. If you’re 19-64 and not disabled, only income counts (no asset test).

What assets are counted for Medi-Cal?

Counted: bank accounts, cash, second vehicles, second homes, stocks, bonds, investments. NOT counted: primary home, one vehicle, household items, retirement accounts (if receiving payments).

Can I own a home and still get Medi-Cal?

Yes. Your primary residence is exempt – it does NOT count toward the $130,000 asset limit. However, starting January 1, 2028, home equity over $1,000,000 will count for long-term care.

Can I have a car and still get Medi-Cal?

Yes, one vehicle per household is exempt. A second car, boat, RV, or other recreational vehicle counts as an asset.

Does my spouse’s income affect my Medi-Cal?

For long-term care, the community spouse can keep income and assets up to certain limits ($162,660 maximum CSRA in 2026). Rules are complex – consult a specialist.

How do I apply for Medi-Cal in 2026?

Apply online at BenefitsCal, by phone through your county office, or in person. New applicants after January 1, 2026 must report assets.

How long does Medi-Cal approval take?

Typically 45 days for standard applications. Faster for presumptive eligibility in some cases.

What documents are required for Medi-Cal?

ID, proof of income, bank statements, vehicle registrations, property deeds (for any property other than primary residence), and proof of any exempt assets (retirement account statements showing payout status).

What happens if my assets exceed the limit?

You may lose Medi-Cal or be placed on a share-of-cost program (Medicaid with a deductible). You can also spend down excess assets on exempt items or medical care.

Can I give away assets to qualify for Medi-Cal?

For long-term care, no. Medicaid has a 5-year lookback period. Gifts or transfers for less than fair market value can trigger a period of ineligibility. For non-long-term-care Medi-Cal, lookback rules may not apply, but always check with a specialist first.

Is the asset limit change real or a scam?

It’s real. But scammers use confusion to steal information. No legitimate Medi-Cal worker will call demanding payment or ask for your Social Security number over the phone. Hang up and call your county office directly.

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Final Takeaway

What changed: California reinstated asset limits for Medi-Cal on January 1, 2026 for seniors (65+), disabled individuals, nursing home residents, and families over-income for MAGI. The limit is **$130,000 for an individual**, increasing by $65,000 per additional household member .

Who’s affected: You, if you’re 65+, have a disability, live in a nursing home, or are in a family that doesn’t qualify for tax-based Medi-Cal. You are NOT affected if you’re on expansion Medi-Cal (19-64, no disability) or in the Pickle, DAC, or DW programs .

What you should do right now:

1. Find out if you’re in an affected group. Are you 65+, disabled, or in long-term care?

2. If yes, inventory your countable assets. Bank accounts, cash, second vehicles, second homes, investments. Remember: primary home and one car are exempt.

3. Compare to the limit: $130,000 individual, $195,000 couple.

4. If you’re under the limit: You’re fine. Just report assets honestly at your next renewal.

5. If you’re over the limit: Start planning. Options include spend-down, converting assets to exempt categories, or consulting an elder law attorney.

6. Find your renewal date in BenefitsCal or by calling your county office. That’s when the asset test applies to you.

7. Don’t panic if you’re over. The limits are high – most people with moderate savings will still qualify. And you have until your renewal date to adjust.

Looking ahead: Federal home equity changes take effect January 1, 2028 – a $1,000,000 equity cap for long-term care . If your home is worth over that, talk to a specialist now.

Need help? Call your local county Medi-Cal office, visit BenefitsCal, or contact a Health Insurance Counseling and Advocacy Program (HICAP) counselor for free, unbiased assistance.