Your mom has lived in a skilled nursing facility in Sacramento for two months, and her savings are shrinking fast. A friend told you Medi-Cal no longer looks at assets. Another said the rules changed again this year. You want to know what is true now and what to do next.
This guide uses the California Department of Health Care Services (DHCS) instructions to counties and Title 22 of the California Code of Regulations. We don't list dollar figures, because they change and because California's limits have shifted twice in recent years. Instead, we explain how each rule works and point to the official DHCS notices. For decisions about property, trusts or gifts, talk with your county Medi-Cal office or a California elder law attorney.
Does Medi-Cal cover nursing homes?
Yes. Long-term care Medi-Cal can pay for nursing facility level-of-care services when your parent needs that level of care and meets the financial rules2. Medicare may pay first for a short rehab stay after a qualifying hospital stay6, but it doesn't cover long-term custodial care. See when Medicare stops paying for a nursing home.
Long-term care Medi-Cal is a non-MAGI program, which means it uses the older age- and disability-based rules, including a property test1. People who already get SSI are generally eligible for Medi-Cal automatically, but they still go through the long-term care steps when they enter a facility.
What changed in 2024, 2025 and 2026
California eliminated the asset test for all non-MAGI Medi-Cal programs, including long-term care, starting January 1, 20242. The 2025 health budget bill, AB 116, restored property limits for most of these programs effective January 1, 202621. The restored limits are well above the federal SSI levels many states use.
The asset limit
Since January 1, 2026, non-MAGI Medi-Cal has a property limit for one person, a higher limit for a couple, and an added amount for each additional household member, up to a maximum household size1. These amounts are listed in DHCS's All County Welfare Directors Letter 26-021. Married applicants are covered by separate spousal rules, described below.
Some property is exempt and doesn't count toward the limit. The most important is the home, covered in the next section. Other items may also be exempt. Ask the county which ones apply in your parent's case before selling or spending anything. To learn how families lawfully reduce countable assets, see Medicaid spend-down.
The home
A home your parent uses or used as a principal residence is exempt if they live there, if certain family members live there, or if they are away for any reason, including a nursing home stay, and declare in writing that they intend to return5. The intent is your parent's own statement, not a medical prediction.
For what may happen to the home after death, see Medicaid estate recovery and can a nursing home take your house. California's estate recovery rules differ from many states, so ask DHCS or an attorney about your parent's situation.
Income and share of cost
California doesn't use a hard income cap for long-term care Medi-Cal. Instead, a resident with income pays a monthly share of cost. For someone in long-term care, the county takes the person's countable income, subtracts allowed deductions, such as health insurance premiums and amounts set aside for a spouse or dependents, and then subtracts the long-term care maintenance need3. What remains is the share of cost3.
The maintenance need for a person in long-term care is a small personal needs amount set in regulation4. Your parent keeps that amount for personal items, pays the share of cost to the facility each month, and Medi-Cal pays the rest of the facility's Medi-Cal rate. Share of cost is recalculated when income or household circumstances change3.
When one spouse stays at home
California applies federal spousal impoverishment rules. When a married person or registered domestic partner enters a nursing facility, a combined property limit applies, and the spouse at home keeps a Community Spouse Resource Allowance (CSRA)1. The CSRA is figured for the first month of eligibility only. Once eligibility is set, it's no longer treated as available to the nursing home spouse1. After approval, there is a limited transfer period, ending about 90 days after the approval notice, to move excess property out of the nursing home spouse's name1.
The spouse at home may also receive part of the nursing home spouse's income if their own income is below the Minimum Monthly Maintenance Needs Allowance, which DHCS updates each year17. Current figures are in ACWDL 26-021.
The 30-month look-back
California's look-back is 30 months, shorter than the 60 months used by most states. Only transfers made within that window can stop Medi-Cal from paying for nursing facility care if they weren't made under the rules in Title 2228. A transfer for less than fair value can lead to a period of ineligibility for nursing facility care only, not for community-based Medi-Cal2. Transfers of exempt property aren't penalized, and a penalty can't cause undue hardship2.
Because the asset test was off during 2024 and 2025, months in that period aren't reviewed for transfers2. Starting July 1, 2026, only the months after the January 1, 2026 reinstatement are reviewed, and the window grows by one month each month until the full 30 months applies again2. Counties review transfers only when someone requests long-term care Medi-Cal2. See the Medicaid look-back period.
An example of how it fits together
Rosa, 84, lives in a skilled nursing facility in Fresno after a stroke. She is widowed, owns her small house and has some savings, plus Social Security and a modest pension. Her daughter applies for long-term care Medi-Cal for her.
Because Rosa signs a statement that she intends to return home, the house is exempt5. Her savings count, and they are under California's restored single-person limit1. She hasn't given anything away since January 1, 2026, so there is nothing to review under the look-back2. The county approves her and sets a share of cost: her monthly income, minus her health insurance premiums and the small personal needs amount34. Rosa pays that amount to the facility each month, and Medi-Cal pays the rest.
Every situation differs, and this is an illustration, not advice. A spouse at home, a recent gift or savings above the limit would change the picture.
A simple planning timeline
- At admission. Ask whether the facility accepts Medi-Cal and who handles applications.
- During Medicare-covered rehab. Gather documents and list any gifts or transfers made since January 1, 20262.
- Before Medicare days run out. Apply with the county and request long-term care Medi-Cal.
- After approval. Pay the share of cost each month and note the renewal date3.
Starting early helps avoid a gap in which your parent owes the facility directly while the application is pending.
How to apply in California
- Confirm the facility takes Medi-Cal. Ask the business office whether the facility is a Medi-Cal provider. See how to choose a nursing home.
- Gather documents. ID, Medicare card, income statements, bank and investment statements, deeds, vehicle titles, life insurance and burial plans.
- Apply with the county. Apply through your county social services office or the state's online portal, BenefitsCal, and say you are requesting long-term care Medi-Cal.
- Sign the intent-to-return statement if it applies. This keeps the home exempt5.
- Answer county requests quickly. Missing a deadline can delay approval.
- Read the approval notice. It shows the share of cost to pay the facility each month3.
For general steps, see how to apply for Medicaid for an elderly parent.
Questions to ask the county
- Which property limit applies to my parent, and how is our home treated?
- Does my parent need to sign an intent-to-return statement?
- How will the share of cost be figured, and which deductions are allowed?
- Are any transfers in the look-back window under review?
- If my parent is married, how are the spousal allowances figured?
- When is the renewal due, and what will you need from us then?
If your parent might return home
Some people can leave a nursing home with enough support. Medi-Cal also funds certain home and community-based programs, and the transfer penalty applies only to nursing facility care, not to community-based Medi-Cal2. Ask the facility's social worker about discharge options, and see Medicaid waivers for home care and Medicaid assisted living waivers.
Common mistakes California families make
- Relying on 2024 or 2025 advice. The asset test returned in 20261.
- Gifting without checking the look-back. Transfers after January 1, 2026 can be reviewed2.
- Forgetting the intent-to-return statement. It's what keeps the home exempt during a long stay5.
- Not paying share of cost. The resident must pay it to the facility each month, or the facility may treat it as unpaid.
- Missing renewals. Medi-Cal must be renewed. Watch the mail and the county account.
If the county denies coverage or sets a share of cost you think is wrong, the notice explains how to ask for a state hearing.
Planning ahead
Because California's limits are higher than most states', many families can plan without drastic steps. Still, the rules have changed twice in recent years and may change again. Keep good records, and check current DHCS notices before making decisions. The long-term care ombudsman can help if a facility pressures your parent to leave while Medi-Cal is pending. See nursing home eviction.
For a broader look at costs in the state, see how to pay for assisted living in California. For other large states, see Texas, Florida and New York Medicaid nursing home eligibility.
