If you or a parent may need Medi-Cal to help pay for long-term care, a significant change is coming in 2027, and it is worth understanding now rather than later. California is planning to sharply lower the amount of savings and property you can hold and still qualify for Medi-Cal. For many families, the window to plan ahead is open today but will narrow considerably.
This article explains what is changing, who it affects, and the practical steps worth thinking through before the new rules take effect.
A quick recap: how we got here
For years, California’s “non-MAGI” Medi-Cal programs, which generally cover people who are 65 or older, blind, or disabled, counted your personal assets when deciding eligibility. California first raised that limit, then phased it out entirely, so for a brief window there was effectively no asset test for those programs.
That window closed on January 1, 2026, when the state reinstated a Medi-Cal asset limit of roughly $130,000 for one person, plus about $65,000 for each additional household member (about $195,000 for a couple). We cover that reinstatement in Medi-Cal and Your Assets: What Changed for 2026 .
What changes in 2027
Facing a budget shortfall, California’s enacted budget goes much further. Under current plans, the asset limit for non-MAGI Medi-Cal is scheduled to drop dramatically, to about $21,000 for a single person and roughly $31,000 for a couple, effective July 1, 2027. That is an 84% cut from the current $130,000 figure, and a return to resource levels close to the federal baseline.
A few important caveats:
- The date may move. State guidance ties the change to the Department of Health Care Services having its systems ready, and some related programs (such as the Pickle, Disabled Adult Child, and Disabled Widow(er) programs) are described as reinstating the test “no sooner than January 1, 2027.” The exact effective date should be confirmed against the latest state notices before you rely on it.
- These figures are current to the best of our knowledge at the time of writing. Medi-Cal rules change often, and sometimes on short notice. Always confirm the latest numbers before acting.
Who this affects, and who it doesn’t
The asset limit applies to non-MAGI Medi-Cal, which generally covers adults 65 or older, people who are blind or disabled, and those who need long-term care such as nursing facility or in-home care.
It does not apply to “MAGI” Medi-Cal, the expansion coverage for many younger adults, children, and families with income under 138% of the federal poverty level. Those programs have no asset test.
Keep in mind that eligibility also has an income component, separate from assets, which for a single person generally runs around $1,800 per month. Meeting one test is not the same as meeting both.
What counts as an asset, and what’s exempt
Not everything you own is counted. Generally:
- Exempt (not counted): your primary residence, one vehicle, household goods and personal effects.
- Countable: savings and checking accounts, certain retirement accounts, cash-value life insurance, a second home or car, and burial plots beyond the basics.
This distinction matters enormously under a $21,000 limit. Under the old $130,000 rule, a typical retirement nest egg often fit within the limit. Under the 2027 rule, many ordinary savers who would never consider themselves wealthy could be over the line.
Watch the transfer “look-back”
You cannot simply give everything away the month before applying. When the asset limit returned in 2026, so did a transfer look-back: gifts or transfers of assets made on or after January 1, 2026 can trigger a period of ineligibility for long-term care Medi-Cal. Transfers made before that date are generally not counted.
The look-back rules are technical, and a well-intentioned gift to a child or grandchild can backfire by delaying the care you need. This is exactly the kind of move to run past an advisor before you make it, not after.
Your home and estate recovery are a separate issue
It’s worth separating two things that families often blur together:
- Eligibility (the asset and income limits above), which decides whether Medi-Cal will pay for your care.
- Estate recovery, which is the state’s ability to seek repayment from your estate after you pass away.
The good news on recovery: in California, the state can only recover from assets that pass through probate. A home held in a properly funded revocable living trust avoids probate, so there is nothing in the probate estate for the state to recover. We explain this in depth in Can Medi-Cal Take Your Home? California Estate Recovery, Explained .
So even as eligibility rules tighten, the core probate-avoidance strategy, a funded living trust , continues to protect the home from recovery. You can also read our overview of probate to see why avoiding it matters.
What to do now
- Take stock of your countable assets so you understand where you’d stand under a $21,000 or $31,000 limit, not just today’s $130,000.
- Don’t rush into gifting. Transfers now can create look-back penalties later. Get advice first.
- Make sure your home and estate plan are in order, including a properly funded living trust, so probate and estate recovery aren’t a worry regardless of the eligibility rules.
- Plan early. The most flexible planning options exist well before a health crisis, not in the middle of one.
A note of realism: Medi-Cal eligibility planning is its own specialty. The interplay of asset limits, transfer penalties, spousal protections, and long-term care rules is intricate, changes frequently, and is not something to engineer from a blog post. If long-term care may be on the horizon for you or a family member, speak with a qualified Medi-Cal planning or elder law attorney, and get your estate plan reviewed, while there is still time to act.
Sources
- California is slashing its Medi-Cal asset limit. Here’s who’s affected (CalMatters)
- DHCS proposed trailer bill legislation: Reinstate the Medi-Cal Asset Limit (PDF)
- DHCS: Medi-Cal Asset Limit Frequently Asked Questions
- Health Consumer Alliance: The Return of Medi-Cal Asset Limits, practice tip (PDF)
- The SCAN Foundation: California 2026-27 Enacted Budget summary (PDF)
This article is general information, current as of November 2026, and not legal advice. Medi-Cal figures and effective dates change; confirm the latest rules before relying on them. For guidance about your situation, schedule a consultation .
