Beginning January 1, 2026, California is rolling back several pandemic-era Medi-Cal policies.
Many People will be impacted by the new rules—especially seniors, people with disabilities, and mixed-status families.
This guide breaks down what’s new, who is affected, and what you can do now.
Key Takeaways (Read This First)
- Asset limits return January 1, 2026: $130,000 for one person, $195,000 for couples
- Your home and one car don’t count—you won’t lose them
- Undocumented adults must enroll by December 31, 2025, or lose access to full coverage
- Current members keep coverage but face asset checks at renewal
These changes affect non-MAGI Medi-Cal, which primarily serves seniors, people with disabilities, and those needing long-term care under Medi-Cal.
The Big Change: Asset Limits Are Back in 2026 After Two Years
California removed asset limits during the pandemic. That break ends on January 1, 2026.
Starting next year, Medi-Cal will check how much you own when you apply or renew coverage.
This affects seniors over 65, people with disabilities, and anyone needing long-term care.
Here’s what you can have:
- One person: $130,000
- Married couple: $195,000
- Each extra family member: Add $65,000 (up to 10 people)
If you’re a working-age adult on regular Medi-Cal, these limits don’t apply to you. Check complete Medicaid eligibility rules for 2026 to see which program applies to your situation.
What Counts—and What Doesn’t
This is where most people worry. Let me make it simple.
You will NOT lose:
- Your primary home (no matter its value)
- One vehicle (completely exempt)
- Retirement accounts, if you’re taking regular payments
What DOES count:
- Second homes or vacation properties
- Extra cars
- Large savings accounts
- Investment accounts not in payout
Your home stays yours. Even if you temporarily live somewhere else, it remains exempt if you plan to return.
Income Rules Stay the Same
Asset rules change, but income limits remain the same.
2026 income limit for a single adult:
- About $21,600 per year
- Around $1,800 per month
What if you earn slightly more? You can still qualify through the spend-down program. Here’s how it works:
Medical bills, prescriptions, and insurance premiums reduce your countable income. Once those expenses bring you below the limit, Medi-Cal approves you.
For more detailed information and to understand what is happening, read my new guide about California’s 2026 medical assets limits for nursing homes and long-term care.
When Will Medi-Cal Check Your Assets?
Medi-Cal doesn’t check everyone at once. They review your assets at your annual renewal—the same month you enrolled.
Your renewal happens after January 1, 2026. You’ll know when by checking BenefitsCal.
If you’re over the limit:
- You get a 90-day grace period
- Your coverage continues during this time
- You can reduce assets or provide paperwork
No surprise cut-offs. No instant terminations.
Critical Deadline for Undocumented Adults
This deadline matters more than anything else.
Starting January 1, 2026:
California freezes new full-scope Medi-Cal enrollments for undocumented adults age 19 and older.
What this means:
- If you’re already enrolled, you keep coverage
- New applicants after January 1 only get Emergency Medi-Cal
- Emergency coverage handles life-threatening conditions only—no preventive care, no routine visits
Additional cuts coming:
- Dental benefits end July 1, 2026 (ages 19-59)
- A $30 monthly premium starts July 2027
What you must do now:
If you qualify today, apply before December 31, 2025. Missing this deadline locks you out of full-scope benefits.
Critical Deadline for Undocumented Adults
This deadline matters more than anything else.
Starting January 1, 2026:
California freezes new full-scope Medi-Cal enrollments for undocumented adults age 19 and older.
What this means:
- If you’re already enrolled, you keep coverage
- New applicants after January 1 only get Emergency Medi-Cal
- Emergency coverage handles life-threatening conditions only—no preventive care, no routine visits
Additional cuts coming:
- Dental benefits end July 1, 2026 (ages 19-59)
- A $30 monthly premium starts July 2027
What you must do now:
If you qualify today, apply before December 31, 2025. Missing this deadline locks you out of full-scope benefits.
Retirement Accounts: The Rules You Need to Know
Many Californians worry about their IRA or 401(k).
Good news:
Traditional IRAs, 401(k)s, and 403(b)s don’t count if you’re taking regular distributions. This includes Required Minimum Distributions (RMDs).
When they DO count:
If your retirement account just sits there without distributions, Medi-Cal counts it toward your asset limit.
If you’re retired or close to retirement, start distributions before your renewal.
What to Do Right Now
You don’t need to panic. You need to prepare.
Simple steps that protect you:
- Check your savings and property values now
- Confirm retirement accounts are in payout status
- Open every piece of Medi-Cal mail immediately
- Mark your renewal month on your calendar
- Keep bank statements and documents organized
Report income or asset changes within 10 days. This prevents problems at renewal.
Real-World Example:
Meet Maria
Maria is 67 and owns her home in Sacramento. She has $85,000 in savings and a car. Her husband passed away last year.
Does she qualify?
Yes. Her home doesn’t count. Her car doesn’t count. Her $85,000 in savings is under the $130,000 limit.
What about her IRA?
Maria started taking RMDs last year. Her IRA doesn’t count as an asset because she’s receiving regular payments.
Maria keeps her Medi-Cal coverage with no changes needed.
Meet Carlos
Carlos is 35 and undocumented. He has diabetes and receives full-scope Medi-Cal today.
Does he keep coverage?
Yes—but only if he completes his renewals on time. Since he enrolled before January 1, 2026, he’s “grandfathered in.”
What changes for him?
- Dental coverage ends July 1, 2026
- He’ll pay $30 per month starting July 2027
What about his brother Miguel?
Miguel is also 35 and undocumented, but never enrolled. If Miguel applies after January 1, 2026, he only gets Emergency Medi-Cal.
He won’t receive preventive care, diabetes management, or routine doctor visits.
Miguel must apply before December 31, 2025, to keep the same benefits Carlos has.
Common Questions Answered
Q: Will Medi-Cal take my house?
No. Your primary home never counts toward asset limits. You can’t lose your house to Medi-Cal.
Q: What if I inherit money in 2026?
Report it to your county Medi-Cal office within 10 days. If the inheritance pushes you over the limit, you have a 90-day grace period to spend down or reorganize.
Q: Can I give money to my kids to stay under the limit?
Be careful. Large transfers within 30 months before applying may trigger penalties. Consult a Medicaid planning professional first.
Q: Does my life insurance count?
Term life insurance doesn’t count. Whole life or universal life policies with cash value may count if the face value exceeds $1,500.
Q: What happens during the 90-day grace period?
Your coverage stays active. You can see doctors, fill prescriptions, and receive care. Use this time to provide documentation or reduce assets.
Why California Made These Changes
California expanded Medi-Cal during the pandemic when federal funding increased. That extra money ends in 2026.
The state budget can’t sustain unlimited asset exemptions. By reinstating limits, California balances coverage for those who need it most while managing costs.
The $130,000 limit is higher than most states. Many states cap assets at $2,000. California still offers more generous protection than most of America.
Getting Help
If your situation feels complicated, get professional help now—not after you receive a denial letter.
Resources:
- BenefitsCal: Check your renewal date and manage your case online
- County Medi-Cal Office: Report changes by phone, mail, or in person
- DHCS Asset Limit FAQ: Official state guidance (search “DHCS asset limits” online)
A Medicaid planning professional can help you reorganize assets legally and keep your coverage.
The Bottom Line
Medi-Cal in 2026 is stricter, but it’s not impossible.
California built in protections:
- Asset exemptions for homes and cars
- 90-day grace periods
- Clear renewal timelines
- Spend-down programs for excess income
If you act early and stay informed, you protect your healthcare.
The worst thing you can do is ignore renewal letters or miss the December 31, 2025, deadline if you’re undocumented.
Your move: Check your assets today. Mark your renewal month. If you’re undocumented and not enrolled, apply before the year ends.
Your health coverage depends on what you do right now—not what you’ll do later.
This article provides general guidance on 2026 Medi-Cal changes. For specific eligibility questions, contact your county Medi-Cal office or visit BenefitsCal. Information is current as of December 2025.
