Medi-Cal Asset Restrict Elimination Will increase Financial Safety for Low-income Older Adults and Folks with Disabilities

Right now, anybody can financially qualify for Medi-Cal primarily based solely on their earnings—wages, retirement or incapacity advantages—due to asset restrict elimination. This was not all the time the coverage. Earlier than July 2022, older adults and other people with disabilities may solely have $2,000 ($3,000/couple) in belongings. These prior asset limits have been overly restrictive, forcing older adults and other people with disabilities to stay in deep poverty to entry important care. These low limits, unchanged since 1989, utilized solely to older adults and other people with disabilities and positioned them at vital danger of economic instability or homelessness when confronted with a disaster comparable to an eviction, a leaking roof, or a serious car restore. These low limits additionally disproportionately harmed folks of shade who usually tend to have money financial savings, as a substitute of an exempt dwelling, additional exacerbating the racial wealth hole.

After intensive research and in recognition of the unfair and punitive nature of asset limits^[1], the California legislature eradicated the asset restrict within the 2021-2022 funds. In July 2022, asset limits elevated to $130,000 (plus $30,000 for every further family member) and have been totally eradicated in January 2024.^[2] With asset restrict elimination, purposes and renewals are simplified for everybody.

This truth sheet describes the optimistic impacts that eliminating the asset restrict has had on low-income older adults and other people with disabilities, whereas dispelling misconceptions relating to this essential change.

Eliminating the Asset Restrict Made the Guidelines the Similar for Everybody

When the Inexpensive Care Act handed and was applied in California, it dramatically simplified the monetary eligibility guidelines for many Medi-Cal applications, aside from applications serving older adults and other people with disabilities. Youthful adults and kids haven’t needed to show their belongings since 2014. Disregarding belongings for all Medi-Cal populations streamlines county eligibility determinations since all Medi-Cal enrollees are evaluated primarily based on earnings, saving time and administrative prices.

Eliminating the Asset Restrict Eradicated the Senior & Incapacity Cliff

The Medicaid enlargement classes don’t have any asset limits, however exclude adults over 65 or anybody with Medicare protection. This implies an individual aged 64 has no limits on the quantity of belongings they will accrue, even when it’s a modest quantity like $5,000. Previous to asset restrict elimination, this identical particular person would lose eligibility once they turned 65 due to a extra restrictive asset restrict, regardless of their monetary and well being standing remaining the identical. This “senior cliff” was eradicated with asset restrict elimination, guaranteeing low-income older adults and other people with disabilities may keep modest financial savings once they turned 65 or obtained Medicare protection.

Eliminating the Asset Restrict Made It Simpler for Eligible Folks to Receive Protection

With asset limits, it’s arduous to get on and keep on Medi-Cal, as an individual should collect current checking account statements, have property evaluated, and show what they personal and in some instances what they don’t personal. Individuals who qualify however can not show their belongings at software or renewal, find yourself being denied or dropping Medi-Cal regardless of being financially eligible. This leaves older adults and other people with disabilities with out entry to non-public care companies, transportation to medical appointments, assist with Medicare value sharing, and residential and group primarily based companies – all of which aren’t coated by Medicare or different well being care applications. In a 2020 research evaluating the influence of asset elimination, California discovered that individuals who have been denied Medi-Cal protection for failure to supply asset info in the end gained eligibility.^[3] Accordingly, the asset elimination facilitates enrollment into Medi-Cal for already eligible folks and helps them keep their eligibility from 12 months to 12 months.

Medi-Cal Earnings Limits Prohibit Rich Californians from Enrolling in Medi-Cal

There’s a false impression that the elimination of asset limits permits rich people to entry Medi-Cal. This false impression disregards Medi-Cal’s earnings restrict, which is 138% of the federal poverty restrict, or $1,801 a month. Analysis analyzing the monetary sources of people present that individuals with restricted incomes should not in a position to accrue vital belongings.^[4] California’s enrollment knowledge is in keeping with this analysis. When the state raised the asset restrict to $130,000 in 2022, 12,189 folks grew to become eligible, or roughly a 1% enhance in enrollment of older adults and other people with disabilities total.^[5]

With full asset elimination, there was a better than anticipated enhance in enrollment amongst older adults and other people with disabilities in comparison with what the state estimated in its authentic research.^[6] This enhance is probably going because of plenty of elements that require additional research and knowledge evaluation to find out the drivers of the upper enrollment and inform a coverage response, if warranted.

Conclusion

The asset restrict enhance and supreme elimination has elevated the financial safety of low-income older adults and other people with disabilities, created equity in program guidelines, and lowered the executive burden and prices for the state and counties in processing eligibility determinations. Asset assessments discourage folks from saving cash and make it troublesome to handle sudden bills, resulting in financial insecurity and homelessness. The median family earnings previous homelessness is $960/month and almost half of adults experiencing homelessness are 50 or older.^[7] With rising inflation and the price of residing eroding the fastened incomes older and disabled folks rely on, asset elimination will increase financial safety and the power to endure occasions like vital well being crises, main car or dwelling repairs, or unemployment. As California’s Legislative Analyst’s Workplace concluded, the asset take a look at elimination is a strong instrument for serving to low-income seniors entry care.^[8]

Contact:

• Yasmin Peled, Director of California Authorities Affairs, Justice in Ageing.

• Linda Nguy, Affiliate Director of Coverage Advocacy, Western Heart on Legislation and Poverty.

Endnotes

1. California Division of Well being Care Providers (DHCS), “Medi-Cal Asset Limits Supplemental Report,” (Mar. 2020). ↑

2. Meeting Invoice 133, including WIC § 14005.62 (July 27, 2021). ↑

3. California Division of Well being Care Providers (DHCS), “Medi-Cal Asset Limits Supplemental Report,” (Mar. 2020). ↑

4. Cohen, M. & Tavares, J. “How Medicaid Monetary Eligibility Guidelines Exclude Financially and Medically Weak Older Adults,” Journal of Ageing & Social Coverage Vol. 36, 2024. ↑

5. California Division of Well being Care Providers (DHCS), “Asset Restrict Modifications for Non-MAGI Medi-Cal” (Information Set – Newly Eligible Inhabitants), final visited Apr. 28, 2025. ↑

6. California Legislative Analyst’s Workplace, “Understanding Current Will increase within the Medi-Cal Senior Caseload,” (Mar. 6, 2025). ↑

7. Kushel, M. & Moore, T, Towards a New Understanding, College of California, San Francisco (June 2023). ↑

8. Id. ↑