Seniors and people with disabilities enrolled in non-MAGI Medi-Cal programs now face asset limits for the first time in years. As of January 1, 2026, California reinstated resource counting for these programs, setting the threshold at $130,000 for a single person and $195,000 for a couple. The change affects both new applicants and existing beneficiaries at renewal, and county offices must now verify bank balances, investments, and other countable resources before approving coverage.
How AB 116 reversed years of loosened Medi-Cal asset rules
The reinstatement traces back to AB 116, the health omnibus trailer bill chaptered by the California Legislature for the 2025-2026 session. That statute directed the Department of Health Care Services (DHCS) to resume asset counting for non-MAGI Medi-Cal programs beginning January 1, 2026. The move reversed a trajectory that had been heading toward full elimination of the asset test. In 2022, a CalAIM Section 1115 Demonstration waiver amendment raised limits to $130,000 per person plus $65,000 for each additional household member and outlined a planned elimination of the test no sooner than January 1, 2024, according to DHCS newsroom records. Instead of disappearing, the test returned with those same elevated thresholds locked in place.
DHCS confirmed the new limits in a January 5, 2026 update, specifying $130,000 for an individual plus $65,000 for each additional household member, up to 10 members. For a two-person household, that yields $195,000. Los Angeles County’s Department of Public Social Services published matching figures, listing $130,000 for one person and $195,000 for two as the operative limits. Countable assets include bank accounts and certain investments, while a primary home and personal vehicle remain exempt.
For many advocates, the reinstated test is less restrictive than the pre-2022 rules but still represents a step backward from the state’s prior commitment to fully remove resource limits. Before the CalAIM changes, non-MAGI Medi-Cal asset thresholds were far lower, often disqualifying people who had modest savings set aside for emergencies or burial costs. The higher $130,000 starting point now offers more room, yet the very act of counting resources again reintroduces administrative complexity and the risk of coverage loss for technical reasons unrelated to medical need.
A steep drop scheduled for July 2027
The current thresholds are temporary. According to DHCS program guidance, the $130,000 individual limit holds only through June 30, 2027. On July 1, 2027, the cap is scheduled to drop sharply to $21,000 for one person and $31,000 for two people, with lower incremental amounts for larger households. That scheduled reduction would push far more beneficiaries over the line, particularly those with modest savings or small retirement accounts that currently fall well below $130,000.
The gap between the two phases is striking. A single enrollee who holds $50,000 in a savings account faces no issue under the current rules but would exceed the July 2027 limit by more than double. Couples who have carefully saved for home repairs, long-term care needs, or family support could find themselves suddenly ineligible unless they spend down or reallocate assets. Advocates warn that the looming “asset cliff” may pressure people to deplete savings that would otherwise help them remain stable and independent.
What beneficiaries and applicants should expect
For now, county eligibility workers must apply the higher limits when processing applications and renewals. Beneficiaries who were approved during the period when the asset test was effectively suspended may be asked to provide new documentation, including bank statements, brokerage account summaries, and information about life insurance or other financial products. Failure to respond or clarify discrepancies can trigger delays or discontinuances even if a person’s resources are clearly under the current cap.
Legal aid organizations and community clinics are preparing for an uptick in questions as renewal notices begin to flag assets again. Seniors who previously heard that “assets no longer matter” for Medi-Cal may be confused to learn that their savings are back under scrutiny. Some may also worry that their homes are at risk, though the primary residence remains exempt for eligibility purposes under the reinstated framework. Outreach groups are emphasizing the importance of reading county notices carefully and seeking help quickly if a verification request is unclear.
Uncertain policy outlook before the 2027 cliff
Whether the Legislature will intervene before the July 2027 reduction takes effect remains an open question. AB 116 locked in the current structure but did not guarantee that future sessions would maintain the higher thresholds. Lawmakers could choose to delay the scheduled drop, modify the dollar amounts, or once again move toward eliminating the asset test altogether. Conversely, they could allow the lower limits to proceed as planned, prioritizing cost controls and program integrity over broader financial flexibility for enrollees.
In the meantime, beneficiaries and advisors must plan around the rules as written. Financial counselors are encouraging Medi-Cal enrollees to keep detailed records of their assets, understand which resources are exempt, and consider how upcoming life events-such as inheritances, property sales, or retirement account withdrawals-might affect eligibility in 2027 and beyond. Until policymakers act, California’s non-MAGI Medi-Cal population will continue to navigate a system that offers relatively generous asset protection today but threatens a much narrower safety net just over a year later.
Free for readers: The free Retirement Shield newsletter sends plain-English help keeping more of your money in retirement — the scams to dodge, the benefits you’re owed, and what’s changing with Social Security and Medicare, a couple times a week. Get the free newsletter.
