Medicaid (Medi-Cal) Spend-Down in California
Primary source: California Department of Health Care Services (DHCS). Additional reference: American Council on Aging — Medicaid Planning Assistance. Figures are adjusted periodically — confirm current numbers with your state Medicaid agency or an elder law attorney before relying on them.
California runs Medicaid long-term care through Medi-Cal, and its rules diverge from most other states in two important ways: there's effectively no income ceiling for eligibility, and — as of January 1, 2026 — the state reinstated an asset test after several years of having none at all. Families who researched Medi-Cal even a year or two ago may be working from outdated information, so it's worth double-checking the current rules before assuming anything carries over.
Income limit
Medi-Cal doesn't use a hard income cap for nursing home eligibility the way most states do. Instead, a recipient's income (minus a small personal needs allowance, roughly $35/month) is redirected to the nursing facility as their "share of cost," with Medi-Cal covering the balance. In practice, this means income alone rarely disqualifies someone — it mostly determines how much of the monthly bill Medi-Cal picks up.
Asset limit
As of 2026, the asset limit for an individual Medi-Cal long-term care applicant is $130,000 in countable assets — a significant reinstatement after the asset test was eliminated for several years. Confirm the current figure and reporting timeline with Medi-Cal or an elder law attorney, since this is a recently changed rule and details are still settling.
Community Spouse Resource Allowance
When only one spouse is applying, the non-applicant "community spouse" can typically retain up to $162,660 in assets (2026), separate from the $130,000 the applicant spouse is allowed to keep. California also protects a Maximum Monthly Maintenance Needs Allowance of roughly $4,066.50/month for the community spouse's income. These figures adjust periodically — treat them as a starting point for a conversation with an elder law attorney, not a final answer.
What to do if your parent is over the limit
If your parent's countable assets are over $130,000, asset spend-down is the standard path: reducing countable resources — through paying down debt, home modifications, or converting cash into exempt assets — until they fall under the state's limit. Because California's asset test is new, an elder law attorney familiar with the 2026 changes specifically is worth the consultation fee here more than in most states. Our spend-down calculator can give you a rough starting estimate using California's current asset limit.
See also: countable vs. exempt assets and how the Community Spouse Resource Allowance works.
This article is for general education, not medical, legal, or financial advice, and rules vary by state and change over time. Read our full disclaimer.