California Governor Gavin Newsom has proposed a new budget plan that suggests implementing an “asset review” for all applicants of California’s medical assistance program. Only applicants with assets less than $2,000 would qualify for this benefit.
This measure is another step taken by Newsom to address the state’s budget shortfall. Just two weeks ago, he proposed another budget plan aimed at restricting undocumented immigrants from accessing the California Medical Assistance Program (Medi-Cal).
Medi-Cal is California’s version of the federal Medicaid program, which is implemented in California as Medi-Cal.
Newsom’s recently revised budget proposal emphasizes that the costs associated with Medi-Cal for the fiscal year 2024-2025 have increased significantly by $37.6 billion compared to $17.1 billion in the 2014-2015 fiscal year.
Over the next few years, the funding needed for Medi-Cal is expected to continue to grow. According to Newsom’s budget proposal, the rising costs of this benefit program are primarily driven by factors such as a surge in the number of participants and increasing pharmacy expenses.
The data from Medi-Cal cases shows that the number of beneficiaries increased from 12.7 million people in the 2019-2020 fiscal year to 15 million people by the 2024-2025 fiscal year.
Newsom has proposed re-introducing “asset review” to limit eligibility for Medi-Cal, thus addressing the issue of rising costs of this welfare program.
In the past few decades, California had a requirement that low-income elderly and disabled individuals had to undergo an “asset review” to qualify for Medi-Cal. This meant that if a single applicant’s assets exceeded $2,000, they were not eligible to apply, and for couples, the asset limit was $3,000.
To determine if an applicant has $2,000 in assets, the state would examine the person’s bank accounts, the amount of cash on hand, whether they own a second vehicle, and other relevant data.
However, in 2024, California abolished the asset review, allowing all income-eligible individuals to apply for certain aspects of Medi-Cal regardless of their total assets.
According to the California Health and Human Services Agency, if the asset review is reinstated along with cuts to another welfare program, “Home Supportive Services,” California is projected to save approximately $94 million in the upcoming fiscal year, $540 million in the following fiscal year, and $791 million annually thereafter.
If Newsom’s proposal is approved, the “asset review” measure will go into effect on January 1, 2026.
(Adapted from the Los Angeles Times)