Practice area
The rules changed January 1, 2026 — has your plan caught up?
Skilled nursing in San Diego County runs well over $10,000 a month, and ordinary health insurance and Medicare do not cover an extended stay. Medi-Cal does. But California reinstated the Medi-Cal asset limit on January 1, 2026, after eliminating it in 2024, and reintroduced a lookback on transfers. Plans built around the 2024 rules are now out of date.
Asset limit is back
$130,000 for an individual, plus $65,000 per additional household member, as of January 1, 2026.
30-month lookback
Gifts and transfers are reviewed going back 30 months.
The home, before and after
It may be exempt during life, yet still exposed to estate recovery after death.
A funded trust is the shield
In California, recovery reaches only the probate estate.
California brought the asset limit back
California eliminated the Medi-Cal asset test in 2024, then reinstated it effective January 1, 2026. The limit is $130,000 for an individual, with an additional $65,000 for each additional household member. Countable assets above the limit have to be addressed before an application will succeed.
This reversal matters because the two-year window without an asset test produced a lot of confident, now-incorrect guidance. If a plan was built or reviewed while the limit was gone, it was built against rules that no longer apply.
A 30-month lookback applies to gifts and transfers
Transfers made for less than fair value are reviewed going back 30 months from the application. A transfer inside that window can create a period of ineligibility, which means the family pays privately during exactly the months they were counting on coverage.
The practical consequence is that giving the house to the children is rarely the clean solution it appears to be, and doing it in a hurry is usually worse than doing nothing. Sequencing is most of the work.
The home: exempt in life, exposed after death
The residence may be exempt while you are alive, so qualifying generally does not require selling it. What survives you is the harder question: California can seek reimbursement for certain Medi-Cal costs through estate recovery after death.
In California, estate recovery reaches only the probate estate. That single limitation is what makes a properly funded revocable living trust the primary shield: a home titled in the trust does not pass through probate, and what does not pass through probate is outside the reach of recovery. A trust that was signed but never funded provides none of this protection.
What still requires care
Income rules, share-of-cost calculations, and protections for a spouse remaining at home are all still in play and still technical. And the interaction between Medi-Cal planning, Proposition 19, and capital gains basis means an approach that solves one problem can quietly create another.
This is an area where general guidance found online is unusually likely to be out of date — most of it has not caught up to January 1, 2026.
Common questions
Medi-Cal Planning
Is there a Medi-Cal asset limit again?
Yes. California reinstated the asset limit effective January 1, 2026: $130,000 for an individual, plus $65,000 for each additional household member. The limit had been eliminated in 2024, so a great deal of advice still circulating reflects the wrong rules.
Do I have to sell my house to qualify for Medi-Cal?
Usually no. The home may be exempt during your lifetime. The exposure comes after death, through Medi-Cal estate recovery, which is where planning to avoid probate does the real work.
Will the state recover against my home after I die?
Only through estate recovery, and in California only against the probate estate. A home held in a properly funded living trust does not pass through probate, which is what places it outside recovery.
How far back does Medi-Cal look at gifts and transfers?
A 30-month lookback applies to gifts and transfers. Moving assets shortly before an application can create a period of ineligibility, so timing matters more now than it did under the 2024 rules.
Is it too late to plan if a parent is already in care?
Often not. The options are narrower than they would have been earlier, but crisis planning is a real practice area and there is usually something worth doing.
Related
Other areas of the practice
Talk it through with an attorney.
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