Updated 2026-05-21 · Reviewed by CCC Editorial Team

Long-term care insurance · A coverage answer

The California Partnership for Long-Term Care, explained

The California Partnership for Long-Term Care provides dollar-for-dollar Medi-Cal asset protection in exchange for buying a qualifying private LTC policy. Qualifying policies require a minimum daily benefit, inflation protection, and tax-qualified status. California briefly ran without a Medi-Cal asset limit in 2024 and 2025, but the asset limit was reinstated on January 1, 2026, at $130,000 for a single applicant and $195,000 for a couple, so the asset-protection feature again matters for ongoing eligibility, alongside estate-recovery protection and the comfort of a hybrid public-private financing plan.

The short answer

The California Partnership for Long-Term Care is a state program that pairs qualifying private long-term-care insurance policies with Medi-Cal asset protection. The mechanism is dollar-for-dollar: for every dollar a Partnership policy pays in covered benefits, the policyholder can keep an additional dollar of assets when later applying for Medi-Cal long-term-care coverage. The protection also extends to Medi-Cal estate recovery after the policyholder’s death.

What LTC insurance + Medi-Cal pays for

10 items

Dollar-for-dollar asset protection during Medi-Cal eligibility
Every dollar the Partnership policy pays in benefits adds a dollar to the assets Medi-Cal will disregard. California reinstated the Medi-Cal asset limit on January 1, 2026 ($130,000 single, $195,000 couple), so this protection again matters for ongoing eligibility.
Covered
Estate recovery protection on protected assets
Assets protected under the Partnership are not subject to Medi-Cal estate recovery after the policyholder’s death.
Covered
Qualifying policy: minimum daily benefit
California Partnership policies must meet a minimum daily benefit, currently around $230 per day, indexed to a Partnership-set schedule.
Covered
Qualifying policy: inflation protection
Compound annual inflation protection of at least 5 percent is required for buyers under age 70; simple inflation may apply at higher ages.
Covered
Qualifying policy: tax-qualified federal status
The policy must be federally tax-qualified (HIPAA-compliant) to participate in the Partnership.
Covered
Hybrid life insurance with LTC rider
Hybrid policies generally do not qualify for the California Partnership; the program is limited to traditional LTC policies that meet Partnership specifications.
Not covered
Out-of-state Partnership policies
Reciprocity rules allow some out-of-state Partnership policies to receive California asset protection. The other state must have a reciprocal agreement, and the policy must meet equivalent specifications.
Conditional
Standard non-Partnership LTC policy
A regular LTC policy still pays benefits as contracted but does not provide the Partnership’s Medi-Cal asset protection.
Not covered
Medi-Cal nursing facility coverage triggered by policy exhaustion
Standard Medi-Cal nursing-facility coverage applies when policy benefits are exhausted, with the Partnership asset protection adjusting the eligibility math.
Covered
Assisted Living Waiver (ALW) coordination
Partnership asset protection applies to Medi-Cal eligibility generally, including ALW in participating counties. Confirm with a Medi-Cal counselor for specific cases.
Conditional

The program in one paragraph

The California Partnership for Long-Term Care is a public-private program created in 1994. It is administered by the California Department of Health Care Services and approved insurers. The deal: you buy a private long-term-care insurance policy that meets Partnership specifications, and in exchange the state agrees to protect a portion of your assets from Medi-Cal spend-down and from Medi-Cal estate recovery later in life. The protection is dollar-for-dollar against the benefits the policy actually pays.

How the dollar-for-dollar protection works

Imagine a buyer purchases a California Partnership policy at age 60 with a daily benefit of $300 and a four-year benefit period. The total potential benefit pool is roughly $438,000 before inflation adjustment. Inflation protection grows the pool over time. The buyer eventually needs care, and the policy pays out, say, $360,000 over a three-year care episode. After the policy is exhausted, the buyer applies for Medi-Cal long-term-care coverage.

Without the Partnership, the Medi-Cal eligibility analysis requires countable assets to fall under the limit (since January 1, 2026, $130,000 for a single applicant and $195,000 for a couple) before Medi-Cal will pay. Under the Partnership, the applicant’s first $360,000 in countable assets above that limit is protected. Additionally, $360,000 of the applicant’s estate is protected from Medi-Cal recovery after death.

What changed in 2024, and what changed back in 2026

California eliminated the Medi-Cal asset limit for non-MAGI Medi-Cal programs at the start of 2024 (the prior $2,000 individual / $3,000 couple cap was removed). For 2024 and 2025, Medi-Cal eligibility was primarily an income-based test for most long-term-care applicants. That window has closed: under AB 116 and DHCS guidance, the asset limit was reinstated on January 1, 2026, at $130,000 for a single applicant, $195,000 for a couple, and an additional $65,000 for each further household member. The Partnership’s asset-protection feature again carries weight for day-to-day eligibility.

Three things make the Partnership worth considering in 2026:

Estate recovery is unchanged.Medi-Cal still has the right to recover the cost of certain services from a deceased beneficiary’s estate. Partnership-protected assets remain exempt.
The policy itself.The Partnership’s underlying product is a high-quality LTC policy with required inflation protection and federal tax-qualified status. The Partnership discipline forces a better policy than most consumers would design themselves.
Future policy risk. The Medi-Cal asset limit is a state choice: it was removed in 2024 and reinstated on January 1, 2026, and a future legislature could change it again. Partnership protection is locked in by contract at issuance.

What a qualifying policy looks like

California Partnership policies must meet four conditions:

A minimum daily benefit, currently around $230 per day, indexed annually by the Partnership.
Compound annual inflation protection of at least 5 percent for buyers under age 70. Simple or lower inflation may apply at higher ages.
Federal tax-qualified status (HIPAA-compliant), meeting the requirements that allow premium deductibility within annual limits.
Sold by a California Partnership-certified agent through an approved insurer. The Department of Health Care Services maintains the current insurer list, which has consolidated as carriers have exited the standalone LTC market.

Hybrid life-with-LTC-rider products generally do not qualify. The Partnership is structured around standalone traditional LTC policies.

Estate recovery, in plain terms

Medi-Cal estate recovery allows the state to recoup the cost of certain long-term-care services provided to a beneficiary aged 55 or older. The state files a claim against the beneficiary’s estate after death. California narrowed the scope of estate recovery in 2017 (the recovery now reaches only assets passing through probate, not non-probate transfers such as joint tenancy with right of survivorship), which made estate-recovery exposure smaller than in many other states. But the exposure exists, and the Partnership eliminates it on protected assets.

Reciprocity with other states

Most states participate in Partnership reciprocity, which means asset protection earned under California’s Partnership is honored if the policyholder later applies for Medicaid in another reciprocity state. The policy continues to pay benefits as contracted, and the asset-protection feature travels with the policyholder. A buyer planning a possible later move out of state should confirm reciprocity status for the likely destination state before relying on the protection.

Who the Partnership is right for in 2026

The Partnership is most attractive for three profiles.

Mid-net-worth California households ($500,000 to $2 million in non-residence assets). Too much to qualify cleanly for Medi-Cal without planning; not enough to self-insure a long care episode. The Partnership fits the gap.
Estate-focused families. Households intending to leave assets to children or grandchildren who want clean estate-recovery protection.
Buyers comparing Partnership to standard LTC. The Partnership policy is usually only marginally more expensive than an equivalent standard LTC policy, while delivering meaningful extra protection.

Households with low assets and modest income often do not need the Partnership: Medi-Cal will cover their care under standard rules. Households with high net worth ($3 million plus, non-residence) often self-insure: the Partnership protection is small relative to the estate. The middle is where the program does its work.

Related coverage and next steps

This page explains coverage and eligibility, not medical advice. Talk to a licensed clinician about care decisions, and to a benefits counselor about your specific plan. California Care Compass does not place referrals on Coverage pages.

Common questions

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How does dollar-for-dollar asset protection actually work?

Imagine a Partnership policy that pays $300,000 in total benefits over a multi-year care episode. After those benefits are exhausted, the policyholder applies for Medi-Cal long-term-care coverage. Under standard Medi-Cal rules, an applicant must keep countable assets under the limit (since January 1, 2026, $130,000 for a single applicant and $195,000 for a couple) to qualify. Under the Partnership, that policyholder gets to keep an additional $300,000 in assets above the limit and still qualify. The same $300,000 is also protected from Medi-Cal estate recovery after death.

Does the Partnership still matter now that California has reinstated the Medi-Cal asset limit?

Yes. California briefly removed the Medi-Cal asset limit in 2024, but the limit was reinstated on January 1, 2026, at $130,000 for a single applicant and $195,000 for a couple (non-MAGI programs, including Long-Term Care Medi-Cal). The Partnership’s asset-protection feature lets a policyholder keep assets above that limit dollar-for-dollar with the benefits the policy paid. On top of that, the estate-recovery protection (Medi-Cal can still seek recovery against a decedent’s estate for certain services), the structured private-pay runway, and the disciplined LTC coverage itself all add value. Buying a Partnership policy in 2026 is a defensible choice, especially for families who want a clean public-private handoff.

What does estate recovery protection mean?

California Medi-Cal has the right to recover the cost of certain services (primarily long-term care provided after age 55) from the estate of a deceased Medi-Cal beneficiary. Partnership-protected assets are exempt from that recovery. For families intending to leave assets to children or grandchildren, this protection is one of the strongest features of the program.

What are the minimum requirements for a Partnership policy in 2026?

California Partnership policies must meet four conditions: a minimum daily benefit (currently around $230 per day, indexed by the Partnership), compound annual inflation protection of at least 5 percent for buyers under age 70, federal tax-qualified status (HIPAA-compliant), and an issuance and approval process through a Partnership-certified insurance agent. The list of participating insurers changes; the Department of Health Care Services maintains the current list.

Are hybrid life insurance with LTC rider policies eligible?

Hybrid policies (life insurance or annuities with an LTC acceleration rider) generally do not qualify for the California Partnership. The Partnership program is structured around traditional standalone LTC policies that meet Partnership specifications. A buyer who wants Partnership protection should buy a Partnership-certified standalone LTC policy from a participating insurer.

What happens if I move to another state?

Partnership reciprocity allows asset protection earned under one state’s Partnership program to be honored when the policyholder later applies for Medicaid in another state, provided both states have signed the reciprocity agreement. Most states participate. The policy travels with the policyholder; benefits continue to be paid under the policy contract regardless of residence.

Who should consider a Partnership policy in 2026?

Three profiles, broadly. First, a California household with $500,000 to $2 million in non-residence assets that wants to fund a long care episode without exhausting the estate. Second, a household focused on protecting an inheritance from Medi-Cal estate recovery. Third, a household that wants a disciplined LTC plan and is comparing Partnership to standard LTC; the price difference is usually small, and the protection is real.

Sources

01California Department of Health Care Services · California Partnership for Long-Term Care · accessed 2026-05-21
02California Department of Health Care Services · Medi-Cal Asset Limit Elimination (2024) · accessed 2026-05-21
03California Department of Insurance · Long-Term Care Insurance · accessed 2026-05-21
04California Health Advocates · Long-Term Care Insurance and the Partnership · accessed 2026-05-21
05Justice in Aging · Medi-Cal Estate Recovery · accessed 2026-05-21
06National Council on Aging · What Is the Long-Term Care Insurance Partnership Program? · accessed 2026-05-21

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