California Reinstates Asset Limit for Medi-Cal Qualification
On January 1, 2024, California’s Medicaid program—known as Medi-Cal—entered uncharted territory by eliminating the asset limit for long-term care eligibility. Most states maintain a $2,000 asset limit for a single individual to qualify for long-term care Medicaid benefits. Although there has been a recent trend to increase that threshold, California was the only state to fully eliminate it.
Elder law attorneys across the state saw new planning opportunities and began exploring strategies to help clients adapt. Some practitioners even revived trust documents that hadn’t been used in decades to align with the program’s new focus on income rather than assets. The policy shift required a fundamentally different approach to Medicaid planning.
However, this experiment was short-lived. At the start of the 2025 legislative session, Governor Gavin Newsom announced that Medi-Cal enrollment had exceeded budget projections. He cited the asset rule change as a contributing factor to the growing budget deficit.
As part of the 2025 budget agreement reached by the state legislature this month, the asset limits will be reinstated to their 2022 levels beginning January 1, 2026. While California will still maintain more generous resource limits than most states—for example, a $130,000 asset limit for individual—assets will once again be a factor in Medi-Cal eligibility.
The bold Medi-Cal policy change that reshaped the elder law planning landscape will have lasted just two years.
Read More: 2026 Asset Limit Reinstatement – Frequently Asked Questions (CANHR)
Krause Financial will continue to monitor and report on changes to long-term care Medicaid eligibility in California and across the country. Sign up for an Attorney Access account to receive updates on asset limits and other eligibility requirements.
Jim is responsible for creating, curating, and promoting high-quality content related to the estate planning and elder law industry. He also plays a primary role in designing and maintaining a robust education and content calendar for Attorney Access.
