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Why California must eliminate the Medi-Cal Asset Test

Millions of California seniors and people with disabilities turn to Medi-Cal for essential health care. This is because ableist, ageist, racist, sexist, and classist policies and practices have blocked seniors and people with disabilities from access to jobs, income, and wealth that can provide health coverage throughout their lifetimes.

A new Fact Sheet by Policy Analyst Aureo Mesquita shows these Californians face further discrimination due to an asset test in Medi-Cal that unfairly applies only to people age 65 or older or who have a disability.

Medi-Cal limits seniors and people with disabilities to assets of no more than $2,000 for individuals and $3,000 for couples — a restriction that has not changed since 1989. Assets include cash on hand, money in a checking or savings account, a second car, and other resources. In addition, seniors must have household incomes that do not exceed 138% of the federal poverty line — $1,482 per month for a single adult or $2,004 for a couple as of 2021.

Policymakers have chosen to exempt certain assets from counting toward the limit. However, by treating resources differently, they have created an uneven playing field. In particular, a primary residence is exempted from the asset test, benefitting homeowners who may qualify for Medi-Cal even with substantial property wealth. In contrast, California renters — who may have other forms of wealth, such as cash savings — do not benefit from significant exemptions. They may be compelled to “spend down” much of their savings to qualify for Medi-Cal — money they could have used for other purposes such as moving costs, emergency expenses, and financing their retirement.

Among seniors who are income-eligible for Medi-Cal, nearly 2 in 3 Asian and Black Californians live in renter households, as do more than half of Latinx and other seniors of color. Homeowners are disproportionately white and renters are disproportionately Californians of color due to the legacy of racist policies and practices in housing, education, and employment.

State policymakers can join other states that have reduced or eliminated the asset test, and help advance health equity for all Californians.

This article was released by the California Budget & Policy Center.