California Medicaid Long-Term Care Eligibility: Assets and Look-Back

California Medicaid long-term care eligibility runs on three tests: you must live in California with acceptable immigration status, a doctor must certify that you need nursing-facility-level care, and your countable assets and income must fall within Medi-Cal’s limits. Starting January 1, 2026, a single applicant can hold up to $130,000 in countable assets, with a home, one vehicle, and retirement accounts in payout status excluded from that total. Married couples get additional protections so the spouse who stays at home is not left destitute.

Medical Necessity and Residency

Two non-financial requirements come first. You have to be a California resident, and you have to provide information about citizenship or immigration status. U.S. citizens and lawfully present applicants supply a Social Security number.¹ Beginning January 1, 2026, adults without satisfactory immigration status face new restrictions on enrolling in full-scope Medi-Cal, with exceptions for people already receiving nursing home or other institutional care.

The medical test is a level-of-care certification. A physician must confirm that your condition is severe enough that, without long-term care services, you would need to be in a nursing facility. That same standard applies whether you plan to enter a nursing home or receive services at home through a waiver.¹ Many applications stall here. If your needs can be met without structured long-term support, the certification will not go through no matter what your finances look like.

The 2026 Asset Limit

California temporarily eliminated asset limits for the non-MAGI programs that cover older adults and people with disabilities. Those limits return on January 1, 2026. A single applicant can hold up to $130,000 in countable assets, and each additional household member adds $65,000, up to a ten-person household.² If your countable assets are over the limit, your application will be denied until you spend down.

Countable assets include bank accounts, cash, stocks, bonds, mutual funds, and other liquid investments. Several important categories are excluded:

Your primary residence is exempt as long as you or your spouse lives there. California does not impose any home equity cap, so the home stays exempt regardless of its value.
One vehicle is fully exempt.
Personal and household items, such as furniture, clothing, and appliances, do not count.
Retirement accounts are exempt if you are taking regular distributions from them.³

The home exemption is the largest planning lever for California families. A residence worth well over a million dollars remains fully exempt, provided the applicant or spouse still lives there.

Income and Share of Cost

Once your assets are under the limit, Medi-Cal looks at your income to decide how much you owe each month toward your own care. That calculation splits sharply depending on where you receive services.

If You Live in a Nursing Home

Nearly all of your monthly income goes to the facility. Medi-Cal lets you keep a Personal Needs Allowance of $35 per month, or $62 per month if you receive Supplemental Security Income, for personal expenses like toiletries or phone calls. Everything above that is your Share of Cost and must be paid to the nursing home before Medi-Cal covers the balance.⁴

If You Receive Care at Home

Home and community-based recipients keep a larger share of their income to cover rent, utilities, and food. Medi-Cal sets an income maintenance level based on federal poverty guidelines, and only income above that threshold becomes your monthly Share of Cost. You have to pay that amount in a given month before coverage kicks in for the rest of your care expenses that month. If you have high medical bills and modest income, your Share of Cost may be effectively met every month.

Protections for a Spouse at Home

Federal spousal impoverishment rules keep one spouse from being wiped out when the other needs long-term care. California applies them through a resource allowance and an income allowance.

Community Spouse Resource Allowance

When one spouse enters a nursing home, the couple’s combined countable assets are added up. The spouse who stays at home can keep a protected share. For 2026, the maximum Community Spouse Resource Allowance is $162,660.⁵ The institutionalized spouse can separately hold up to $130,000 under the reinstated asset limit.³ Assets above those combined figures must be spent down before the nursing home spouse qualifies.

Minimum Monthly Maintenance Needs Allowance

The community spouse is also guaranteed a minimum monthly income. For 2026, the federal floor is $2,643.75 and the federal maximum is $4,066.50.⁵ If the community spouse’s own income is below the applicable figure, part of the institutionalized spouse’s income can be redirected to bring the household up to that floor.

The 30-Month Look-Back on Transfers

California is reinstating a look-back period along with the return of asset limits. When you apply for nursing home coverage, the state will review whether you gave away or sold assets below fair market value during the 30 months before you entered the facility. Transfers made before January 1, 2026, will not be counted. Only transfers on or after that date fall within the review window.³

If the state finds a disqualifying transfer, it calculates a penalty period by dividing the value of the transferred assets by the Average Private Patient Rate, which for 2026 is approximately $14,440 per month. A gift of $72,200 would produce a five-month penalty during which Medi-Cal will not pay for your nursing home stay. The penalty clock only starts running once you are otherwise eligible and have applied, so the gap in coverage hits when you most need coverage.

Transfers That Do Not Trigger a Penalty

Federal law carves out several exceptions that apply in California:⁶

Unlimited transfers to your spouse, or to anyone else for the sole benefit of your spouse.
Any asset, including a home, transferred to a child who is blind or permanently disabled.
Transfer of your home to a minor child.
Transfer of your home to a son or daughter who lived with you for at least two years before you entered a nursing home and provided care that delayed your need for institutional placement.
Transfer of your home to a sibling who co-owns it and lived there for at least one year before you entered a facility.
Sales at actual fair market value, which are not gifts.³

The caretaker-child exception trips up many families because it requires proof that the child’s care actually let the parent avoid a nursing home. Occasional visits or help with groceries generally do not meet the standard. Documentation from a physician or care manager showing hands-on care equivalent to what a facility would provide strengthens the case.

Home and Community-Based Alternatives

Nursing home placement is not the only option Medi-Cal covers. Several programs let eligible individuals receive long-term care at home or in community settings.¹

In-Home Supportive Services (IHSS) pays for a caregiver, who can be a family member, to help with daily tasks like bathing, meal preparation, housekeeping, and transportation. You must be on full-scope Medi-Cal and live at home.
The Multipurpose Senior Services Program (MSSP) is a federal 1915(c) waiver for Medi-Cal recipients aged 60 or older who need nursing-facility-level care. It coordinates medical and social services, including care management, respite care, and home modifications, and is available only where your county operates an MSSP site.⁷
The Program of All-Inclusive Care for the Elderly (PACE) coordinates all preventive, primary, acute, and long-term care services for people 55 and older who qualify for nursing-home-level care. You must live in a PACE service area and be able to live safely at home when you enroll.⁸

You can only be enrolled in one HCBS waiver at a time. Each program has geographic restrictions, and not every county participates. A county Medi-Cal office or a local Health Insurance Counseling and Advocacy Program (HICAP) counselor can identify which options operate in your area.

Partnership Insurance and Asset Protection

California participates in the California Partnership for Long-Term Care, which rewards people who purchased qualifying long-term care insurance policies. For every dollar your Partnership policy pays out in benefits, the same amount of your assets is shielded from Medi-Cal’s asset limit if you later apply.⁹ Protected assets are also exempt from estate recovery after death. Policies have to meet specific state requirements and are only useful if bought well before care is needed.

Estate Recovery After You Die

After a Medi-Cal beneficiary dies, the state must seek repayment for certain long-term care costs it covered, including nursing home stays and home and community-based services. California limits recovery to assets that pass through the deceased person’s probate estate.¹⁰ Assets held in a living trust, joint tenancy, or other arrangements that avoid probate are generally outside the state’s reach.

Recovery is prohibited entirely when the deceased beneficiary is survived by a spouse or registered domestic partner, a child under age 21, or a child of any age who is blind or permanently disabled.¹⁰ Even without those protections, heirs can request a hardship waiver, most commonly for a homestead of modest value relative to homes in the same county, or for income-producing property like a farm or family business that surviving family depends on.¹¹

Appealing a Denial

If your Medi-Cal application is denied or your benefits are reduced, you can request a state fair hearing. For actions taken by the county or the Department of Health Care Services, you have 90 days from the date on the notice of action to file.¹² If your coverage runs through a Medi-Cal managed care plan, you generally need to appeal through the plan first, within 60 days, then request a state hearing within 120 days if the plan’s answer is unsatisfactory.

You can request a hearing online, by phone at (800) 743-8525, or in writing. Include the specific reason you believe the action was wrong and any supporting documentation, especially medical records if the denial relates to the level-of-care determination. California temporarily extended the hearing deadline to 120 days for certain redetermination actions, including terminations of eligibility and increases in Share of Cost, and that extension remains in effect.¹² If you request a hearing before your current benefits end, you can ask that Medi-Cal keep paying for services while the appeal is pending.

1
DHCS – CA.gov. Medi-Cal Help Center
2
California Legislative Information. California Welfare and Institutions Code WIC 14005.62
3
DHCS – CA.gov. Asset Limit Frequently Asked Questions
4
California Department of Health Care Services. Medi-Cal Questions and Answers
5
Centers for Medicare and Medicaid Services. 2026 SSI and Spousal Impoverishment Standards
6
Office of the Law Revision Counsel. 42 USC 1396p – Liens, Adjustments and Recoveries, and Transfers of Assets
7
DHCS – CA.gov. Multipurpose Senior Services Program MSSP Medi-Cal Waiver
8
DHCS – CA.gov. Program of All-Inclusive Care for the Elderly
9
DHCS – CA.gov. California Partnership for Long-Term Care
10
California Legislative Information. California Welfare and Institutions Code WIC 14009.5
11
ASPE. Medicaid Estate Recovery
12
California Department of Social Services. State Hearing Requests