California Medicaid (Medi-Cal) Income & Asset Limits for Nursing Homes & Long Term Care

Last updated: December 06, 2021

 

California Medicaid (Medi-Cal) Definition

Medicaid is a wide-ranging state and federal health care program for low-income individuals of any age. This page, however, is strictly focused on Medicaid eligibility for California residents aged 65 and over. Specifically, it covers long term care. In addition to nursing home care and assisted living services, California Medicaid pays for many non-medical support services that help frail seniors remain living in their homes. Medicaid in California is called Medi-Cal.

 The American Council on Aging now offers a free, quick and easy Medicaid eligibility test for seniors.

 

Medi-Cal Income & Assets Limits for Eligibility

There are several different Medicaid long-term care programs for which California seniors may be eligible. These programs have varying eligibility requirements, as well as benefits.

1) Institutional / Nursing Home Medicaid – This is an entitlement program; Anyone who is eligible will receive assistance. Services are provided only in nursing homes.

2) Medicaid Waivers / Home and Community Based Services (HCBS) – This is not an entitlement program; The number of participants is limited and waitlists may exist. Benefits are intended to delay nursing home admissions and may be provided at home, adult day care, or in assisted living. More on waivers.

3) Regular Medicaid / Aged, Blind and Disabled (ABD) – This is an entitlement program; Meeting eligibility requirements ensures services will be provided. Various long-term care benefits, such as personal care assistance or adult day care, may be available.

Eligibility for these programs is complicated by the facts that the criteria vary with marital status and that California offers multiple pathways towards eligibility. The table below provides a quick reference to allow seniors to determine if they might be immediately eligible for long term care from a Medi-Cal program. Alternatively, one can take the Medicaid Eligibility TestIMPORTANT: If one does not meet all the criteria below, it does not mean one is ineligible or cannot become eligible for California Medicaid. More.

April 2021 – March 2022 California Medicaid / Medi-Cal Long Term Care Eligibility for Seniors
Type of Medicaid Single Married (both spouses applying) Married (one spouse applying)
Income Limit Asset Limit Level of Care Required Income Limit Asset Limit Level of Care Required Income Limit Asset Limit Level of Care Required
Institutional / Nursing Home Medicaid No income limit* $2,000 Nursing Home No income limit* $3,000 Nursing Home No income limit* $2,000 for applicant & $137,400 for non-applicant Nursing Home
Medicaid Waivers / Home and Community Based Services $1,481 / month $2,000 Nursing Home $2,003 / month $3,000 Nursing Home $1,481 / month for applicant $2,000 for applicant & $137,400 for non-applicant Nursing Home
Regular Medicaid / Aged Blind and Disabled $1,481 / month $2,000 Help with ADLs $2,003 / month $3,000 Help with ADLs $2,081 / month** $3,000 Help with ADLs
*While there is no income limit, a nursing home beneficiary is not able to keep all of their monthly income. With very few exceptions, such as a personal needs allowance of $35 / month, Medicare premiums, and a spousal income allowance (if applicable), all of one’s income must be paid to the nursing home as a share of cost towards care.

**The income limit of $2,081 / month is a combination of the applicant income limit of $1,481 / month and a $600 / month maintenance needs allowance for the non-applicant spouse.

 

What Defines “Income”

Any income that a Medicaid applicant receives is counted. This income can come from any source and includes employment wages, alimony payments, pension payments, Social Security Disability Income, Social Security Income, IRA withdrawals, and stock dividends. Holocaust restitution payments and Covid-19 stimulus checks are not considered income and do not impact Medicaid eligibility.

When just one spouse of a married couple applies for nursing home Medicaid or a HCBS Medicaid waiver, only the income of the applicant is counted. This means the income of the non-applicant spouse does not impact the applicant spouse’s Medicaid eligibility. The non-applicant spouse, however, may be entitled to a Minimum Monthly Maintenance Needs Allowance (MMMNA) from the applicant spouse to prevent spousal impoverishment. In 2022, the MMMNA in CA is $3,435 / month. If a non-applicant spouse has monthly income under this amount, income can be transferred from the applicant spouse to the non-applicant spouse to bring their monthly income up to this level. A non-applicant spouse who already has a monthly income of $3,435 or more is not entitled to a MMMNA / spousal income allowance.

Income is counted differently when only one spouse applies for regular ABD Medicaid; The income of both the applicant spouse and non-applicant spouse is calculated towards the applicant’s income eligibility. Learn more about how Medicaid counts income.

 

What Defines “Assets”

Countable assets include cash, stocks, bonds, investments, credit union, savings, and checking accounts, and real estate in which one does not reside. Other assets are exempt (non-countable) and include personal belongings, household furnishings, an automobile, irrevocable burial trusts, and generally one’s primary home. For the home to be exempt, the Medicaid applicant must live in the home or have an “intent to return” if a spouse does not live in it. California does not have a maximum home equity interest limit like the other states.

 While one’s home is usually exempt from Medicaid’s asset limit, it is not exempt from Medicaid’s estate recovery program. Following a long-term care Medicaid beneficiary’s death, the state Medicaid agency attempts reimbursement of care costs through whatever estate of the deceased still remains. This is often the home. Without proper planning strategies in place, the home will be used to reimburse Medicaid for providing care rather than going to family as inheritance.

All assets of a married couple are considered jointly owned regardless of the long-term care Medicaid program for which one is applying. However, the non-applicant spouse of a nursing home Medicaid or HCBS Medicaid Waiver applicant is permitted a Community Spouse Resource Allowance (CSRA). In 2022, the community spouse (the non-applicant spouse) can retain up to $137,400 of the couple’s joint assets, as shown in the chart above.

California has a Medicaid Look-Back Period, which immediately precedes one’s Medicaid application date. While most states utilize a 60-month “look back”, CA is much more lenient with a 30-month “look back”. As part of the application review, Medicaid checks to ensure no assets were sold or given away under fair market value during this period. Violating this rule results in a penalty period of Medicaid ineligibility.

 Non-Financial Eligibility Requirements – For Medi-Cal long term care, an applicant’s functional need is considered. For nursing home Medicaid and HCBS Medicaid Waivers, a nursing facility level of care (NFLOC) is required. Furthermore, certain benefits may have additional eligibility requirements specific to that benefit. For example, for a Waiver to cover the cost of home modifications, an inability to safely live independently without modifying the home might be required. For long-term care services via the regular Medicaid program, a functional need with the activities of daily living is required, but a NFLOC is not necessarily required.

California is in the process of eliminating the asset test for all Medi-Cal programs for seniors and disabled persons. This means that there will be no asset limit for eligibility purposes for regular Medicaid / Aged, Blind and Disabled Medicaid, HCBS (home and community based services) Medicaid Waivers, and nursing home Medicaid. This change has not yet been implemented, but it is anticipated the asset limit will increase to $130,000 for an individual and $195,000 for a couple beginning on July 1, 2022. It is also anticipated that the asset limit be eliminated altogether no sooner than January 1, 2024. There are still many unknowns as to the exact details. However, it is vital that persons continue to avoid violating MediCal’s 30-month look back period.

 

Qualifying When Over the Limits

For elderly California residents (65+) who do not meet the eligibility requirements in the table above, there are other ways to qualify for Medicaid.

1) Medically Needy Pathway – CA has an Aged, Blind and Disabled – Medically Needy Program (ABD-MN) that is specifically intended for aged, blind or disabled persons who have income over the Medicaid limit. This program is applicable for ABD Regular Medicaid and HCBS Medicaid waivers. It allows seniors who have “excess” income to become eligible for Medicaid services by paying what is called a “Share of Cost”. Essentially, a predetermined Maintenance Need Allowance (MNA) is deducted from one’s countable monthly income, determining one’s share of cost. In 2022, the MNA is $600 for an individual and $934 for a married couple. Also called a Spend Down program, one’s “excess income,” the amount that is determined as one’s cost of share, is used to cover medical bills. Once one has paid their share of cost, they will be eligible for Medi-Cal for the remainder of the month. The asset limits remain the same as above. Learn more about the medically needy pathway.

2) Asset Spend Down – Persons who have countable assets over Medi-Cal’s asset limit can reduce their countable assets by “spending down” extra assets. This can be done by spending “excess” assets on non-countable ones, such as home modifications (i.e., addition of wheelchair ramps or stair lifts), prepaying funeral and burial expenses, and paying off debt. Remember that assets cannot be gifted or sold under fair market value, as it violates Medicaid’s look back rule. When “spending down”, it is best to keep documentation of how assets were spent as evidence the look back period was not violated.

 Use our Medi-Cal spend down calculator to determine if you will have to “spend down” your assets, and if so, receive an estimate of the amount.

3) Medicaid Planning – the majority of persons considering Medicaid are “over-income” or “over-asset” or both, but still cannot afford their cost of care.  For persons in this situation, Medicaid planning exists. By working with a Medicaid planning professional, families can employ a variety of strategies to help them become Medicaid eligible and protect their home from Medicaid’s estate recovery program. Read more or connect with a Medicaid planner.

 

Specific California Medicaid Programs

In addition to paying for nursing home care, Medi-Cal offers six programs / HCBS Waivers relevant to the elderly that helps them to remain living in their homes or in assisted living residences.

1) In-Home Supportive Services (IHSS) – Provides for a wide variety of support and care services to individuals in their homes. Family members, including spouses, can be hired as personal care providers.

2) Medi-Cal Assisted Living Waiver (ALW) – Though not statewide, this waiver helps pay for some of the cost of assisted living.

3) Community Based Adult Services (CBAS) Program – Available statewide, this program provides for adult day care and adult day health care.

4) Multipurpose Senior Services Program Waiver (MSSP) – Provides California seniors with assistance for home modifications, personal emergency response services, and other in-home supports.

5) Home and Community-Based Alternatives (HCBA) Waiver – Provides similar services to MSSP but targets more persons who are temporarily living in nursing homes and wish to return home.

6) Program of All-Inclusive Care for the Elderly (PACE) – Combines the benefits of Medicaid, including long-term care services, and Medicare into one program.

 

How to Apply for California Medicaid

For more information or to apply for a long-term care Medicaid program, one can contact their local county Department of Social Services office.  One can also apply for Medi-Cal online at Covered California or by calling 1-800-300-1506.

It is vital that Medi-Cal applicants be certain that all eligibility requirements are met prior to applying for benefits. Elderly CA residents who are over the income and / or asset limit(s), or are unsure if they are, should strongly consider Medicaid planning for the best chance of acceptance into a Medicaid program. Learn more about the Medicaid application process.

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