California will sharply reduce the amount of savings and property that older adults and people with disabilities can hold and still qualify for Medi-Cal, with the change taking effect July 1, 2027. The individual limit will drop from $130,000 to $21,000, and the limit for a couple will fall from $195,000 to $31,000, with an additional $1,550 for each further qualified household member, up to 10 people.
That is an 84 percent reduction, and it lands on the population that uses the state's most expensive services: people who qualify for Medi-Cal because of age, disability, or a need for nursing home or other long-term care.
The change was written into the final 2026-27 state budget signed at the end of June. It is not a proposal, and families have close to two years to plan. That planning window is the most useful thing about this story, because the rules governing what counts as an asset are narrower and more specific than most households assume.
From $130,000 to $21,000 in One Budget Line
The context matters. Under a 2021 law, California raised the individual limit from $2,000 to $130,000 in 2022 and then phased out its Medi-Cal asset test entirely.
The state reversed course for budget reasons, reinstating the $130,000 limit at the start of this year. Reporting by the California Health Care Foundation documented that enrollment after the asset test was eliminated ran far above the state's early projections, and that the change cost substantially more than budget analysts had anticipated.
The governor's May budget revision had proposed returning to the 1989-era limit of $2,000 for an individual, a 98 percent cut. The Legislature rejected that figure. The National Health Law Program described the final outcome as a partial win, noting the enacted limits are substantially higher than proposed and the effective date was pushed to July 2027, while still calling the reduction harmful.
An important caveat on numbers: coverage-loss estimates circulating publicly, including projections of tens of thousands losing eligibility, were calculated for the rejected $2,000 threshold. A state estimate specific to the enacted $21,000 limit has not been published.
Long-Term Care and In-Home Support Are the Real Stakes
Medi-Cal is the primary payer for nursing home care in California, and eligibility for In-Home Supportive Services is generally tied to Medi-Cal eligibility. That linkage is where this change bites hardest.
Disability Rights California notes that because of the lower asset limit, some people with disabilities will lose access to IHSS, the program that pays for personal care, housework and accompaniment to medical appointments so people can remain at home rather than entering a facility.
The practical consequence for a family is concrete. An older parent with modest savings and a second vehicle could be comfortably under the current limit and over the new one. Losing Medi-Cal would mean losing the funding source for in-home aide hours, and in some cases accelerating a move into institutional care that the family had hoped to delay.
The California Budget and Policy Center has argued that low asset limits force people to spend down savings, leaving little cushion for rent deposits, property taxes or emergencies. Cindy George, senior personal finance editor at GoodRx, has said the old thresholds "left people in profound poverty."
Countable Assets Are Narrower Than Most Families Assume
A great deal of household anxiety around asset tests comes from misunderstanding what is counted.
According to Medi-Cal's asset limit guidance, the home you live in is not counted. Neither is one vehicle, nor ordinary household items such as furniture and clothing, and certain retirement savings are also excluded.
What is counted includes bank accounts, cash, and property beyond one home and one vehicle. Household size is also narrower than people expect. DHCS states that "not everyone in your home may count toward your family size"; adult children living with a parent, for example, are not included.
Timing also differs by situation. New applicants must meet the limit when they apply. Current members report assets at their annual renewal, and Justice in Aging has emphasized that existing enrollees do not need to take action until they receive a renewal form or a request for information. Missing that deadline, not exceeding the limit, is the most common cause of preventable coverage loss.
Nearly Two Years of Planning Time Before the Deadline
Families should not make major financial moves based on a headline. For most people, giving away or selling assets does not affect Medi-Cal, but for anyone in or likely to need long-term care, transfers can trigger look-back rules and delay eligibility at the worst possible moment.
The reasonable steps now are simpler. Find out which assets in your household would actually be counted. If a parent or relative is on Medi-Cal, confirm the county office has a current mailing address so renewal notices arrive. Watch for any renewal packet and return it by the due date. Contact your county Medi-Cal office with specific questions, and consider a consultation with a legal services organization, an elder law attorney or a Health Insurance Counseling and Advocacy Program counselor before restructuring anything.
Implementation details, including county guidance letters, are still being developed, and the Legislature could revisit the threshold in future budget cycles.
The bottom line for California families is that nothing changes at renewal this year or next. The change arrives in July 2027; it affects only Medi-Cal programs for older adults, people with disabilities, and those needing long-term care, and the households most at risk are those with savings between roughly $21,000 and $130,000 who depend on Medi-Cal for in-home or facility care.
Frequently Asked Questions
When does the new Medi-Cal asset limit take effect? July 1, 2027. The current limit of $130,000 for an individual remains in place until then.
What are the new limits? $21,000 for one person, $31,000 for a couple, plus $1,550 for each additional qualified household member, up to a maximum of 10 people.
Who does this apply to? Medi-Cal applicants and members who qualify based on being 65 or older, having a disability, living in a nursing home, or being in a family with income too high to qualify under federal tax rules. It does not apply to enrollees who qualify under income-based rules alone.
Does my house count against the limit? No. Your primary home and one vehicle are not counted. Property beyond one home and one vehicle, along with bank accounts and cash, is counted.
Will this affect In-Home Supportive Services? It can. IHSS eligibility is generally tied to Medi-Cal eligibility, so someone who loses Medi-Cal because of the new asset limit could lose IHSS as well.
Do I need to do anything right now? No immediate action is required. Make sure your county Medi-Cal office has your current address, and respond promptly to any renewal form or request for information.
Should I give away assets to stay eligible? Not without advice. For people in or approaching long-term care, transfers can trigger look-back rules and delay coverage. Speak with a county Medi-Cal office, legal aid organization or elder law attorney first.
