Medi-Cal Asset Limits Are Back in 2026: The Numbers, the 2027 Cliff, and What to Do Now

California’s Medi-Cal asset limit is $130,000 for an individual applicant and $195,000 for a married couple, effective January 1, 2026, now that the asset test has been reinstated under Assembly Bill 116 (AB 116, Stats. 2025, ch. 21, § 59, adding Welfare and Institutions Code § 14005.62). If you or a parent is applying for Medi-Cal, or renewing existing coverage, this is the number that decides whether countable assets disqualify the application, and it is already scheduled to drop sharply on July 1, 2027.

I practice trust and estate planning in Ventura, Santa Barbara, and Los Angeles Counties, and Medi-Cal eligibility questions come up constantly in long-term care planning. Here is the rule of thumb I give clients: a living trust does not hide your assets from the Medi-Cal eligibility test, but it keeps those assets out of estate recovery after you die. Those are two separate problems, and mixing them up is the single most common mistake I see people make when they try to plan for Medi-Cal on their own. This page walks through the current numbers, what counts as an asset and what does not, the look-back rules, the spousal protections, the estate recovery rules that took effect under SB 833, and what I tell clients to do before their next renewal.

What Is the Medi-Cal Asset Limit in 2026?

For most non-MAGI Medi-Cal categories, including long-term care coverage, California reinstated an asset limit effective January 1, 2026. Before that date, California had eliminated its asset test entirely for a period. AB 116 brought it back, though at levels well above the pre-elimination figures. The Department of Health Care Services (DHCS) confirmed the reinstated amounts in All County Welfare Directors Letter (ACWDL) 25-14.

Source: AB 116 (2025), bill text, § 59, adding W&I Code § 14005.62; DHCS ACWDL 25-14.

Is the July 2027 Asset Limit Drop Really Happening?

Yes. Under current law, the asset limit is scheduled to fall again on July 1, 2027 (enacted, Stats. 2026, ch. 27, §§ 68-69). Unless the legislature acts to change it before then, the amounts drop to roughly one-sixth of the 2026 numbers.

I want to be precise about what that scheduled drop is and is not. It is not tied to the federal Supplemental Security Income (SSI) resource limit, and it does not “align” California with any federal standard. It is simply the number the legislature wrote into the statute for the second phase of reinstatement. If you are inside the 2026 window with assets between roughly $31,000 and $195,000 as a couple, or between $21,000 and $130,000 as an individual, you have a real planning window that closes on July 1, 2027, and it is worth using.

What Counts Toward the Medi-Cal Asset Limit, and What Is Exempt?

The asset limit only applies to countable assets. A number of assets are exempt regardless of value, and the most important one for most of my clients is the home.

• Principal residence: exempt. Under Welfare and Institutions Code § 14006 and DHCS guidance, the applicant’s principal residence is not a countable asset for Medi-Cal eligibility purposes, regardless of its value.
• One vehicle: generally exempt.
• Personal effects and household goods: generally exempt.
• Prepaid burial or irrevocable burial trusts, within limits: generally exempt.
• Cash, bank accounts, stocks, bonds, and most real property other than the principal residence: countable and applied against the $130,000 / $195,000 limit.
• Assets held in a revocable living trust: still countable. Because the settlor retains control and can revoke the trust and reclaim the assets, DHCS treats revocable trust assets as available to the applicant for eligibility purposes. Funding a revocable trust does not remove assets from the eligibility calculation.

That last point is where the eligibility and recovery questions get confused, and it is worth its own section below.

What Is the Medi-Cal Look-Back Period in California?

California applies a 30-month look-back period for transfers connected to nursing-facility level of care, according to the DHCS asset-limit FAQ. That is shorter than the federal default of 60 months used in most other states; California has never adopted the federal 60-month look-back.

The reinstatement of the asset limit also carries a transition rule that matters for anyone who moved assets before or after January 1, 2026:

• Transfers made before January 1, 2026 are not penalized under the reinstated asset-limit rules.
• Transfers made on or after January 1, 2026 can trigger a period of ineligibility if they fall within the 30-month look-back and were made for less than fair market value.

In practice, this means the timing of any gift or transfer relative to January 1, 2026 matters as much as the transfer itself. Anyone who transferred assets in anticipation of a Medi-Cal application should confirm exactly when the transfer occurred and how it is treated under the current rule, not the rule that applied when the asset limit was eliminated.

What If Only One Spouse Needs Medi-Cal? The CSRA and MMMNA

When one spouse applies for long-term care Medi-Cal and the other spouse remains in the community, California allows the community spouse to keep additional resources and income beyond the applicant’s own limit, so the household is not forced to spend down to poverty to qualify one spouse for care.

Source: DHCS ACWDL 26-02. These figures work alongside, not instead of, the $195,000 couple limit described above, and the interaction between the CSRA and the household asset limit is one of the more common places I see people miscalculate their own eligibility before coming in for a consultation.

Does a Living Trust Hide My Assets From Medi-Cal?

No. This is worth repeating in plain terms: a living trust does not hide your assets from the Medi-Cal eligibility test, but it keeps those assets out of estate recovery after you die.

While you are alive, DHCS looks through a revocable living trust to the assets inside it. If you can revoke the trust and get the assets back, those assets count against the $130,000 or $195,000 limit just as if you held them in your own name. A living trust is not a Medi-Cal planning tool for eligibility purposes, full stop.

Where the trust matters is after death. Assets that pass through a properly funded revocable living trust avoid probate, and California’s Medi-Cal estate recovery program is now limited to the probate estate. That is the distinction the rest of this section covers, and it is why “funding the trust” and “qualifying for Medi-Cal” are two different projects with two different timelines.

How Does Medi-Cal Estate Recovery Work After January 2026?

Since Senate Bill 833 (SB 833, Stats. 2016, ch. 30, § 22), California limits Medi-Cal estate recovery to the probate estate, codified at Welfare and Institutions Code § 14009.5(f)(3). That is a narrower target than the “expanded estate” definition (which would reach non-probate assets like trust property, joint tenancy interests, and payable-on-death accounts) that some other states use and that California itself briefly allowed before SB 833.

In practice, this means:

• Assets that pass outside of probate, including assets held in a funded revocable living trust, are outside the reach of a Medi-Cal estate recovery claim.
• Assets that pass through probate, such as property left in your individual name with no trust and no other survivorship mechanism, remain subject to recovery.
• Recovery does not proceed while a surviving spouse or registered domestic partner is living.
• Recovery is barred against a surviving child under 21, or a surviving child of any age who is blind or disabled.
• A hardship waiver is available for a homestead of modest value, generally where the property’s value is 50% or less of the average home value in the county.

This is exactly why funding a living trust is one of the most effective steps a Medi-Cal recipient’s family can take, not to qualify for benefits, but to keep the home and other assets out of the state’s recovery claim once probate would otherwise be required. It does nothing to help you qualify while you are alive; it does a great deal to protect what is left after you pass.

What Should You Do Before Your Next Medi-Cal Renewal?

1. Confirm your current countable assets against the $130,000 / $195,000 limit before your next annual renewal, not after a notice arrives.
2. Check whether the principal residence is titled correctly. The exemption under § 14006 applies to the residence itself; how it is titled affects what happens to it later, including whether it passes through probate.
3. Review any transfers made in the last 30 months and note whether each one occurred before or after January 1, 2026, since the reinstated look-back penalty only applies to post-2026 transfers.
4. If you are married and only one spouse needs care, calculate the CSRA and MMMNA before assuming the household must spend down to the individual limit.
5. Fund your revocable living trust now if you have not finished that step. An unfunded or partially funded trust leaves assets in probate, exactly where a Medi-Cal recovery claim can reach them.
6. Calendar July 1, 2027. If your countable assets sit between the 2026 limit and the scheduled 2027 limit, that is the window in which planning choices matter most.

Why the July 2027 Cliff Is the Real Planning Deadline

The reinstated 2026 limits are generous compared to what is coming. A married couple with $180,000 in countable assets is comfortably under the $195,000 limit today. On July 1, 2027, that same couple would be nearly $150,000 over the scheduled $31,000 limit, absent a legislative change. Families who wait until the drop takes effect to start planning lose the 30-month look-back runway they would otherwise have if they act now. The gap between “eligible today” and “scheduled to be ineligible in 2027” is the single clearest argument for getting a Medi-Cal and trust funding review done in 2026 rather than waiting.

Frequently Asked Questions

What is the Medi-Cal asset limit for 2026?

$130,000 for an individual applicant and $195,000 for a married couple, effective January 1, 2026, with $65,000 for each additional household member up to 10, under AB 116 and DHCS ACWDL 25-14.

Does a living trust hide assets from Medi-Cal?

No. A living trust does not hide your assets from the Medi-Cal eligibility test, but it keeps those assets out of estate recovery after you die. DHCS counts revocable trust assets as available to you while you are alive; the trust’s value shows up only later, in keeping assets out of probate and therefore out of the state’s recovery claim.

Is the Medi-Cal asset limit going away again in 2027?

Not entirely, but it drops substantially. Under current law, the limit is scheduled to fall to $21,000 for an individual, $31,000 for a couple, and $1,550 for each additional person, effective July 1, 2027.

What is the Medi-Cal look-back period in California?

30 months for nursing-facility-related transfers, per DHCS guidance. California has never used the federal 60-month look-back. Transfers made before January 1, 2026 are not penalized under the reinstated asset-limit rules; transfers made on or after that date can trigger ineligibility if made within the look-back period for less than fair value.

Can Medi-Cal take my house after I die?

Only if the house passes through probate. Since SB 833 and W&I Code § 14009.5(f)(3), California’s Medi-Cal estate recovery reaches only the probate estate. A home that is exempt during your life under § 14006 and that passes through a properly funded revocable living trust, rather than through probate, is outside the recovery claim. Recovery also does not proceed while a surviving spouse or registered domestic partner is living, and it is barred against a surviving child under 21 or a blind or disabled child of any age, with a hardship waiver available for a modest-value homestead.

This page is attorney-authored general information about California Medi-Cal asset and estate recovery rules as of the date above. It is not legal advice for your specific situation, and Medi-Cal eligibility rules apply differently depending on your assets, income, marital status, and county. If you want a review of where your assets stand against the 2026 limit, and whether your trust is funded in a way that will actually keep your home out of probate, I’d be glad to walk through it with you.

Related reading: how a living trust interacts with Medi-Cal planning, Medi-Cal estate recovery under AB 116, incapacity planning in California, and the full rundown of 2026 California estate law changes. If you are starting from scratch, see what a living trust attorney actually does, and our flat fees for a full estate plan.

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