California’s Medi-Cal program is once again changing course. Beginning January 1, 2026, the state will reinstate asset limits for most older adults and individuals with disabilities applying for long-term care or other non-MAGI (non-Modified Adjusted Gross Income) Medi-Cal programs.
This marks a major shift from recent years when asset tests were eliminated. Many California residents are now wondering how this change will affect their eligibility—and what steps they should take to protect their coverage.
A Brief History: From Asset Limits to Expansion—and Back Again
For decades, Medi-Cal eligibility for older adults and individuals with disabilities included strict asset tests. Applicants were required to keep countable assets under $2,000 for an individual or $3,000 for a couple, excluding exempt assets like a primary residence and one vehicle.
Recent reforms temporarily changed that:
- July 1, 2022: The asset limit increased to $130,000 per individual.
- January 1, 2024: The asset test was completely eliminated for most non-MAGI Medi-Cal applicants, allowing people to qualify regardless of assets—as long as their income met program guidelines.
However, under a new state budget agreement, California will reinstate Medi-Cal asset limits in 2026, rolling back these expansions and returning to a more traditional eligibility framework.
What Are the New Medi-Cal Asset Limits in 2026?
Starting January 1, 2026, Medi-Cal will again impose asset limits for non-MAGI eligibility. While higher than the old $2,000 threshold, these limits still represent a significant change:
- $130,000 for an individual applicant
- $130,000 for an institutionalized spouse (in a nursing home), plus $157,920 for the community (at-home) spouse
- SSI-linked Medi-Cal beneficiaries will remain subject to the much lower federal SSI asset limits
These thresholds will apply to both new applicants and current recipients during their annual redetermination process.
Who Will Be Affected by the 2026 Asset Rules?
1. New Applicants (After January 1, 2026)
Anyone applying for non-MAGI Medi-Cal after this date must report their assets and stay within the new limits.
2. Current Medi-Cal Beneficiaries
Existing Medi-Cal recipients will be required to disclose assets during renewal starting in 2026.
3. Individuals Who Transferred Assets in 2024–2025
People who gave away or transferred assets during the no-limit period may face new scrutiny. The state has not yet clarified whether these transfers will trigger penalties under the reinstated rules.
What Assets Count Toward the Medi-Cal Limit?
The distinction between countable and exempt assets is not changing. Here’s a summary:
Exempt (Non-Countable) Assets
- Primary residence (if you or your spouse live there)
- One vehicle
- Household goods and personal effects
- Jewelry within reasonable limits
- Retirement accounts in payout status
- The individual’s $130,000 property reserve
Countable Assets
- Cash, checking, and savings accounts
- Investment accounts (stocks, bonds, mutual funds)
- Real estate other than your primary home
- Second vehicles
- Business interests (in some cases)
Understanding which assets are protected—and which are not—is essential for maintaining eligibility.
What If You Gave Away Assets in 2025?
One of the most uncertain issues involves asset transfers made during the no-limit period (2022–2025).
For example, if you gifted $50,000 to a family member in 2025 while legally eligible for Medi-Cal, could that gift now create a transfer penalty in 2026?
As of now, California’s Department of Health Care Services (DHCS) has not issued official guidance. Until they do, it’s critical to consult an elder law attorney before making additional transfers or gifts.
How to Prepare for the 2026 Medi-Cal Asset Rule Change
If you or a loved one currently receives Medi-Cal—or plan to apply soon—take these steps now to protect your benefits:
- Inventory your assets.
Identify all holdings and classify them as countable or exempt. - Avoid last-minute gifts or transfers.
These could create eligibility issues once the new rules take effect. - Consult an experienced elder law attorney.
A Medi-Cal planning lawyer can help you:- Legally protect or restructure assets
- Set up irrevocable trusts or other planning tools
- Avoid transfer penalties and coverage interruptions
- Navigate your renewal and reporting process
Proper planning can help you maintain eligibility and protect your family’s financial future.
Plan Ahead to Protect Your Medi-Cal Eligibility
The reinstatement of Medi-Cal asset limits in 2026 represents a major policy shift—rolling back the expanded access Californians enjoyed over the past few years.
While the new limits are more generous than the $2,000 cap of the past, they still require careful financial planning and timely action.
If you or someone you love depends on Medi-Cal for long-term care, now is the time to prepare. A qualified Medi-Cal planning attorney can help ensure your assets are protected, your eligibility is secure, and your future remains stable.
Need Help Navigating the 2026 Medi-Cal Asset Rules?
Contact Elder Law Services of California today.
Our team has helped thousands of families qualify for Medi-Cal while protecting their homes, savings, and dignity.
2026 Medi-Cal Asset Rules Questions & Answers
Q: What are the new Medi-Cal asset limits for 2026?
The new limits are $130,000 for an individual, and $130,000 for an institutionalized spouse plus $157,920 for the at-home spouse.
These rules replace the temporary asset-free period introduced in 2024. It’s important to review your finances and consult a Medi-Cal planning attorney to stay within these limits and protect your eligibility.
Q: Who will be affected by the Medi-Cal asset rule change in 2026?
Both new applicants and current beneficiaries will need to disclose their assets during the eligibility review process.
Those who transferred assets between 2022 and 2025 may also face scrutiny depending on final state guidance.
Q: Will Medi-Cal count my home or car as assets in 2026?
Medi-Cal typically excludes certain personal property, household items, and retirement accounts in payout status.
However, investment accounts, second properties, and additional vehicles are usually countable assets and may affect eligibility.
An elder law attorney can help you determine which assets are protected.
Q: How can I protect my assets before the Medi-Cal rule changes in 2026?
Avoid last-minute gifts or transfers that could trigger penalties later.
A qualified Medi-Cal planning lawyer can help you restructure or protect assets, set up trusts, and ensure continued eligibility.
Early planning can make a major difference in preserving your long-term care benefits.
Call For Your
Free Consultation
Call Elder Law Services of California today at
(800) 403-6078
to schedule a FREE Consultation with one of our expert lawyers.