Medi-Cal: The Return of the Asset Limit

October 27, 2025

Below is an an update from our partners at California Advocates for Nursing Home Reform (CANHR).

After a brief period of expanded access, California plans to reinstate the asset limit for Medi-Cal, once again placing financial eligibility restrictions on older adults seeking healthcare through the state’s Medicaid program. This policy change, effective January 1, 2026, marks a significant reversal from the recent efforts to eliminate barriers for older adults and people with disabilities. Many Medi-Cal beneficiaries want to know how to keep their benefits and services, especially given that the return of the asset limit is fast approaching. This article aims to provide some clarification based on recently released guidance from the Department of Health Care Services (DHCS), which provides oversight to California’s Medi-Cal program.

What is the asset limit?

The asset limit is the amount a Medi-Cal recipient can own in property and other liquid assets to be eligible for Medi-Cal. The asset limits are as follows:

$130,000 for a single person

$195,000 for a couple

An additional $65,000 for qualified household members

Couples who qualify for spousal impoverishment protections may receive additional asset protections

Exempt vs. Non-Exempt Assets

Not all of your assets are counted during eligibility. Medi-Cal divides assets into two categories: exempt and non-exempt.

Exempt assets are assets that do not count against eligibility. For example, the primary residence (the home) will be exempt regardless of its value. For a complete list of exempt assets, please see the Medi-Cal General Property Limitations form created by DHCS.

Non-exempt assets, on the other hand, are counted in the property reserve and during eligibility determination. If the total value of your non-exempt assets place you above the asset limit, you may lose your benefits.

When will I need to report my assets?

New applicants in 2026 will need to report assets at the time of application.

Current recipients will need to report assets either at their annual renewal or during a change in circumstance. You are required to report a change in circumstance if there are changes in your income or assets, household size or tax filing status, citizenship or immigration status, or there is a loss of contact with Medi-Cal as a result of mail that is returned as undeliverable, or if there is a change in Medi-Cal program eligibility. Annual increases to your social security do not count as a change in circumstance.

If you report a change in circumstances unrelated to your assets, Medi-Cal will try to verify your asset information using information already in your record. If you have never reported any assets before, Medi-Cal should not ask for asset details until your annual renewal in 2026. In that case, the case worker should process the change without requesting any new information about your assets.

Annual Renewal Example:

If your regular renewal month is November, you will be expected to report assets during your renewal in November, 2026, assuming you do not experience a change in circumstance next year.

Change in Circumstance Example:

Your annual renewal is in August, 2026. You report a change in household size in May, 2026. Medi-Cal will check your record for any asset information previously provided, but because you never had to report assets before, there is no asset information to verify. Medi-Cal should process your change in household size and should not request any new information about assets until your renewal in August.

If your regular renewal month is November, you will be expected to report assets during your renewal in November, 2026, assuming you do not experience a change in circumstance next year.

Are there ways to lower my assets?

Yes, you can bring down your countable assets by transferring them out of your name, or spending down on something you may need. For example, if you have $150,000 in your bank, you would need to spend down $20,000 if you want to remain eligible for Medi-Cal. You can spend the excess $20,000 on an exempt asset, like a car if you do not already have one, term life insurance, a burial plot, or other exempt assets. You can also spend down the money by paying off outstanding debts you may have, or buying things you need like clothing, furniture or food.

If you plan to transfer or gift assets to another person, you will need to consider the potential impacts to your benefits should the transfer result in a penalty. For Medi-Cal recipients who receive services at home or in a board and care facility, transfers will not be penalized, allowing you to transfer as much and as often as you need to meet the asset limit. On the other hand, Medi-Cal recipients who enter a skilled nursing facility, also known as a nursing home, will be subject to a look-back period upon their admission. This means Medi-Cal will review your financial records to look for any assets transferred within the past 30 months before admission to a nursing home and will determine whether the transfers result in a period of ineligibility. Not all transfers will result in a period of ineligibility – transfers of exempt assets will not be penalized. Any transfers made from January 1, 2024 through December 31, 2025 will not be counted during the look-back period because all assets were exempt during this time.

Although transfer penalties do not apply to Medi-Cal recipients living in the community, unexpected events may lead to a nursing home stay. It may be helpful to speak with an attorney about transferring assets in order to minimize, or avoid, a period of ineligibility resulting from a large transfer.

How will I be affected if I already have Medi-Cal under Spousal Impoverishment?

If you are already receiving Medi-Cal with Spousal Impoverishment, the community spouse (the non-Medi-Cal spouse) can keep an unlimited amount of assets in their name without jeopardizing your Medi-Cal benefits so long as you are under the $130,000 limit for assets in your name. All County Letter 90-01 states that Medi-Cal cannot subject the “community spouse” to a redetermination of the Community Spouse Resource Allowance (CSRA) after the application has been approved. Any assets acquired by the community spouse after the approval of the application will be considered “after-acquired assets” and will not affect your benefits.

New applicants will not be eligible for this exception and must be sure that the Medi-Cal spouse has less than $130,000 in their name, while the community spouse has less than the Community Spouse Resource Allowance (CSRA) in their name. We do not yet know the 2026 CSRA, but for reference, the 2025 CSRA is $157,920.

With these changes approaching quickly it is vital to explore options that may help you keep your Medi-Cal benefits and services. DHCS will continue to release guidance in the following months, and as such, CANHR will continue to update our resources to reflect the most recent information.

If you have additional questions about the asset limit reinstatement, please read our “2026 Asset Limit Reinstatement Frequently Asked Questions.”