key takeaway
California’s proposed Medi-Cal asset limit would force seniors and people with disabilities to spend down modest savings in order to keep health coverage and in-home care services, increasing the risk of housing instability, financial insecurity, and poverty.
The governor’s May Revision proposes decreasing the current Medi-Cal asset limit from $130,000 to just $2,000 for an individual, reflecting a 98% reduction in the limit to qualify for Medi-Cal. The $2,000 restriction was first put in place in 1989, making the figure grossly outdated, especially considering the cost of living today. Since eligibility for In-Home Supportive Services (IHSS) is generally linked to Medi-Cal eligibility, many people who lose access to Medi-Cal could also lose access to IHSS.
What Are In-Home Supportive Services?
The In-Home Supportive Services (IHSS) program provides in-home assistance to seniors, individuals who are blind, and people with disabilities who qualify. Examples of IHSS include personal care (e.g., bathing, dressing, and grooming) and help with meal preparation. By providing this care, IHSS allows participants to continue living safely and independently in their own homes instead of moving to costly out-of-home facilities.
The example in the chart demonstrates how someone with moderate assets, in the form of $10,000 in savings, would be well over the proposed $2,000 limit, making them ineligible for Medi-Cal and therefore ineligible for IHSS.
This drastic decrease in the asset limit would have far-reaching consequences for older adults and Californians with disabilities including:
- Forcing individuals to spend their life savings, leaving very little in their bank account in case of emergencies. For an individual with a modest $10,000 in life savings, they would be forced to spend 80% of what is in their bank account to adhere to the asset limit.
- Preventing individuals from renting an apartment or remaining in their homes, increasing their risk of experiencing homelessness. If an applicant is required to pay for first and last month’s rent for an apartment — which in California is about $3,000 on average — the asset limit would make it impossible to save up that amount without losing their health care coverage. If an individual owns their home, they may be unable to pay their property tax, which is, on average, $4,230 in California, after spending down their life savings.
The proposed asset limit fails to reflect the realities individuals need to save for and could force older adults and Californians with disabilities to decide between having a place to live and saving for an emergency or receiving life-saving care through Medi-Cal and IHSS.
