Medi-Cal Share of Cost: Why You Were Approved and Still Owe Money

A monthly Medi-Cal Share of Cost isn't a bill from the state, and it doesn't mean the county got your approval wrong. A Medi-Cal Share of Cost is the amount you pay, or promise to pay, your own doctors and providers each month before Medi-Cal covers the rest.

If you just opened an approval notice for yourself or a parent and found a monthly dollar figure on it, the confusion is understandable. The Share of Cost is how Medi-Cal approved someone whose income is above its free-coverage limit, and several things can lower it.1

In This Guide

• Why Medi-Cal Approved You With a Share of Cost
• How the County Calculates Your Medi-Cal Share of Cost
• How a Share of Cost Works Month to Month
• What Can Lower Your Medi-Cal Share of Cost
• The Medicare Part B Trap, and How to Get Out of It
• If Your Share of Cost Looks Wrong or Goes Up
• If Your Family Member Lives in a Nursing Home
• Frequently Asked Questions

Why Medi-Cal Approved You With a Share of Cost

It can feel like a contradiction: the notice says "approved," and in the same letter it says you owe money every month. Both are true, and they're connected.

Medi-Cal, California's version of Medicaid, has a route for people who would qualify except that their income is too high. DHCS calls it the Medically Needy program: a non-MAGI program that lets someone "spend down excess income on qualified medical expenses (known as SOC) in order to become eligible for Medi-Cal coverage." That spend-down is the Share of Cost.1

California's Welfare and Institutions Code section 14005.7 sets the rule. A medically needy person's monthly income above the maintenance amount, less what they pay for Medicare and other health insurance premiums, is the spend-down they must meet, and no medically needy person is entitled to Medi-Cal services in a month their spend-down hasn't been met. California uses this medically needy route instead of the income-cap pathway some other states use.4

So the Share of Cost isn't a penalty added after approval. It's the condition the approval rests on. If your parent's income were at or below Medi-Cal's free-coverage income limit, there would be no Share of Cost at all. The national version of this pathway is explained in our guide to medically needy Medicaid, and the general idea in What Is Medicaid Spend-Down?

How the County Calculates Your Medi-Cal Share of Cost

DHCS describes the Share of Cost calculation simply: it is how much income a person has in excess of the maintenance need, minus any applicable deductions. Your county welfare department runs the numbers and sets the Share of Cost amount, and that amount can change from month to month as income changes.1

The maintenance need is the part most families have never heard of. DHCS describes the Medi-Cal maintenance need as a standard amount meant to let a person or family meet basic needs, and it is "not based on their actual expenses." Your real rent, food and utility bills don't change the maintenance need.2

The $600 figure, and the increase that didn't happen

According to DHCS's All County Welfare Directors Letter 23-31, the monthly Medi-Cal maintenance need is based on the old Aid to Families with Dependent Children (AFDC) payment levels and "has remained at $600 for an individual since 1989." Letter 23-31 also announced that a 2022 California law, Senate Bill 184, would raise the Medi-Cal maintenance need to 138% of the federal poverty level on January 1, 2025, but only if the state budget had the money and federal approvals came through.2

The Senate Bill 184 increase to 138% of the federal poverty level never took effect. In Letter 24-10, dated September 18, 2024, DHCS said that due to budgetary restrictions in the 2024-2025 fiscal year the Share of Cost reform "is hereby revoked," declared Letter 23-31 obsolete, and said the maintenance need "will continue to be based on" the AFDC payment levels. If you've read that Share of Cost was going away in 2025, that information is out of date.2

For a married couple or a larger household, the county uses the Medi-Cal maintenance need set for a family of that size, not the single-person figure. Your Notice of Action should show the amount the county used.2,5

How a Share of Cost Works Month to Month

This is where a lot of the worry eases, because the rules are more flexible than the word "owe" suggests. DHCS spells out how it works:1

• You can promise to pay. A Share of Cost is the amount you "must pay or promise to pay to the provider" before Medi-Cal starts to pay. You don't need the cash in hand on the day of the appointment.
• It's owed to the provider. The money goes to the doctor, pharmacy, hospital or dentist who treated you. It is not owed to Medi-Cal or the State, and providers may let you pay over time instead of all at once.
• It resets every month. Each month starts fresh.
• No care, no Share of Cost. You only pay in months when you get health or dental care.

Federal Medicaid rules explain why a promise counts. Under 42 CFR 435.831, a medical expense is "incurred on the date liability for the expense arises," so a bill you're responsible for counts toward the spend-down whether or not you've paid it yet.1

Once your bills for the month add up to the Share of Cost, Medi-Cal starts to pay for that month's covered care. Tell each provider up front that you have a Share of Cost. If a provider seems unsure, the Medi-Cal line at (800) 541-5555 handles questions about medical bills.6

What Can Lower Your Medi-Cal Share of Cost

Here's the part families most often miss. The county can only subtract what it knows about, and the deductions that lower a Share of Cost are spelled out in federal rules. Under 42 CFR 435.831(e), the agency must count these as medical expenses against income above the maintenance need:1

• Premiums. Medicare premiums and other health insurance premiums, including a Medigap or other supplemental policy. California's own statute subtracts these too.4
• Deductibles, coinsurance and copays you're charged.
• Necessary medical and remedial care that state law recognizes even if Medi-Cal doesn't cover it.
• Covered care beyond Medi-Cal's limits, including services that exceed limits on amount, duration or scope.

A related federal provision, 42 CFR 435.831(f)(5), also counts payments you make this month on older medical bills that weren't already deducted from income in an earlier month. These deductions come with a caution: 42 CFR 435.831 lets the state set reasonable limits on some of these amounts, so not every dollar is guaranteed to count in full.1

Old unpaid medical bills

California also applies old unpaid medical bills toward a Share of Cost under a court case called Hunt v. Kizer. DHCS confirmed in Letter 23-31 that the Share of Cost reform "does not impact the policies and procedures of applying unpaid medical bills towards SOC under Hunt v. Kizer."1

Not every old unpaid medical bill qualifies under Hunt v. Kizer, and the county decides which ones count. If your parent has unpaid hospital, doctor or pharmacy bills from before the Share of Cost started, gather them and ask the county eligibility worker in writing whether they can be applied. It costs nothing to ask.

The Medicare Part B Trap, and How to Get Out of It

If you or your parent has Medicare, there's a second cost hiding behind the Share of Cost. DHCS says that since April 1, 2011, it does not pay Medicare Part B premiums for people who have not met their Share of Cost that month. The Social Security Administration deducts the premium from the Social Security check instead, and refunds it later for any month in which the Share of Cost is met. Medi-Cal members with a zero or certified Share of Cost keep having their Part B premiums paid.3

In practice, someone who rarely sees a doctor can lose the Part B premium from their check most months. The fix is a Medicare Savings Program. DHCS has told counties that two of them, Qualified Medicare Beneficiary (QMB) and Specified Low-Income Medicare Beneficiary (SLMB), pay the Part B premium as a separate benefit whether or not the person also has Medi-Cal with a Share of Cost. A third, Qualifying Individual (QI), is narrower: DHCS lists it for people who cannot also receive Medi-Cal.7 California counties must screen every Medicare-eligible Medi-Cal applicant and member for Medicare Savings Programs.3

Applying for a Medicare Savings Program in California works the same way as applying for Medi-Cal, and DHCS's income limits for these programs leave room for deductions. Our guide to California Medicare Savings Programs has the 2026 limits. If the county never mentioned these programs, ask.7

If Your Share of Cost Looks Wrong or Goes Up

Mistakes happen, and a Share of Cost that seems too high is worth questioning. Start by checking that the county has every premium and medical bill on file. If it still looks wrong, you can ask for a State Hearing with the California Department of Social Services (CDSS).8

For most county Medi-Cal decisions in California, you have 90 days to request a State Hearing. When the county re-checks your eligibility and the result increases your Share of Cost, DHCS temporarily extended the window to request a State Hearing to 120 days from the date the notice was mailed, and CDSS says that 120-day extension remains in effect until further notice. You can request a hearing online, by mail, by fax, or by calling (800) 743-8525. If you ask for a State Hearing before the change takes effect, or within 10 days of the notice, your Medi-Cal benefits can continue at the old level while the hearing is pending.8

Our guide to California Medi-Cal appeals and fair hearings covers the process step by step.

If Your Family Member Lives in a Nursing Home

Everything above is about the Share of Cost for someone living at home. A Share of Cost for a nursing-home resident works differently: DHCS says the reform letters never changed "how a SOC is calculated for Long-Term Care (LTC) Medi-Cal."1

For a resident who stays in long-term care the whole month, California's Medi-Cal maintenance need is $35 a month for personal needs (as of 2026), and the rest of countable income generally goes toward the monthly share of cost. Our guides to the California personal needs allowance and Medi-Cal long-term care explain that calculation.5

Learn More

Find personalized help understanding and lowering your Medi-Cal Share of Cost at brevy.com.

The information on Brevy.com is for educational purposes only and is not a substitute for professional legal, financial, or medical advice. Rules vary by state and program and change frequently. Always verify with the relevant agency or a qualified professional. Brevy is not a law firm, financial advisor, or healthcare provider.