Asset Limit Test Update

In this blog, I will discuss some of the implications associated with the passage of Assembly Bill (AB) 133, effective January 1, 2024, more specifically, the removal of the Asset Test for Non-MAGI Medi-Cal recipients in California.

Before discussing the impact of these changes on how you work with your client, remember that this only applies to individuals receiving Medi-Cal only and Medi-Cal with Supplemental Security Disability Payments (SSDI).

The removal of the asset test does not apply to individuals receiving Supplemental Security Income (SSI). SSI is a federal program, and income and assets count towards eligibility. An individual would need to place their settlement funds in a Special Needs Trust to retain eligibility for SSI. Or they could drop SSI and apply for Medi-Cal to receive settlement funds now. California is a 1634 state that gives automatic eligibility for Medi-Cal to any individual who receives SSI. SSI has minimal exclusions for income. Click here to view how SSI counts income. If an individual purchases a Structured Settlement Annuity with a payment stream, that unearned income is countable towards SSI eligibility unless assigned to a Special Needs Trust.

The Department of Health Care Services (DHCS) will allow those individuals who were denied Non-MAGI Medi-Cal in the six months before January 1, 2024, to re-apply. From now on, individuals applying for Non-MAGI Medi-Cal will not need to report their assets. ONLY countable income will determine eligibility for Non-MAGI Medi-CAl. DHCS is working collaboratively with the California Statewide Automated Welfare System (CalSAWS) for this process to move forward smoothly.

Key Point

When settling a case with an individual who has mental capacity and is qualified for Non-MAGI Medi-Cal, they can have any amount of money in the bank and still maintain eligibility for Non-MAGI Medi-Cal. The state will re-evaluate Assembly Bill AB 133 every five years.


When considering the use of a Structured Settlement Annuity in your settlement plan, those funds will still need to be irrevocably assigned to a Special Needs Trust or OBRA trust to prevent the payments from being countable as un-earned income for those receiving Non-MAGI Medi-CAl.