In California, an estimated 1.8 million residents, or about 5% of the inhabitants, are immigrants with out authorized permission to dwell within the nation. They carry out many roles native residents would by no means do. The monetary problem going through Sacramento is that these immigrants additionally comprise practically 1 / 4 of the state basic fund price of well being care by way of California’s program for low-income residents, Medi-Cal.
The state has made regular progress during the last 9 years to supply Medi-Cal protection to an increasing number of of this inhabitants. In 2024, all these residents grew to become eligible for Medi-Cal. This can be a signature achievement for Gov. Gavin Newsom and legislative Democrats. However it might be short-lived.
An explosion in Medi-Cal prices is now testing this program to its limits as President Donald Trump and the Republican-led Congress have but to make large funds trims essential to partially pay for an anticipated reduce in taxes. Cuts to the federal Medicaid program (often known as Medi-Cal within the state) are a close to certainty. Right here in Sacramento, the place lawmakers are a pair months away from going through their funds deadline for the 2025-26 fiscal 12 months, one thing is about to offer.
“It’s impossible to know at this point just who could be impacted,” Kristof Stremikis, director of market evaluation and perception for the California Well being Care Basis, informed The Bee. “What is clear is that reducing revenue requires covering fewer people, reducing benefits or paying health care providers less.”
Sacramento’s Republican delegation has been seizing on this run-up in Medi-Cal prices and blaming it on the Democrats’ resolution to cowl the immigrants who lack authorized permission. Analysts level to quite a few elements.
Excessive prices
However there is no such thing as a getting across the disproportionate price of overlaying these residents to the state. That’s as a result of the federal authorities, which offers greater than 60% of the general cash for this program, doesn’t cowl immigrants within the nation illegally. California has stepped in to pay these prices with its personal cash. In health-speak, these Californians have an “unsatisfactory immigration status.”
Medi-Cal is bleeding a lot cash that the Newsom administration has needed to search a right away infusion of greater than $3 billion merely to pay the payments for this fiscal 12 months. Michelle Baass, director of the California Division of Well being Providers, lately informed legislators that rising prices are because of “higher-than-anticipated enrollment (including the undocumented population) and increased pharmacy costs.” The full program is estimated to price greater than $188 billion to cowl about 15 million Californians, about $42 billion coming from the state basic fund.
The well being protection of immigrants lack authorized standing doesn’t really feel like a profitable wedge subject for California’s Republican management. Polls have proven that greater than 60% help this protection, with that proportion rising over time.
Its reputation undoubtedly won’t be misplaced on the governor, as he’s on an uncharted political journey away from the “toxic” Democrat model as he takes new positions, equivalent to opposing transgender females in athletic competitors. Newsom merely can’t run away from himself. He was the candidate for governor who promised common well being look after all Californians by a centralized, single-payer system. Well being care is such a core worth; no podcast from Marin County might hope to alter that.
Too profitable
Medi-Cal’s monetary downside is because of its reputation, particularly, extra Californians signed up for it this 12 months than anticipated.
“It’s very difficult to project what the caseload level is going to be,” mentioned Jason Constantouros, a principal fiscal and coverage analyst for the California Legislative Analyst’s Workplace, the Legislature’s nonpartisan assume tank.
If there’s a single inhabitants to “blame” for the run-up in Medi-Cal prices, it might be seniors. California has been significantly beneficiant in permitting low-income seniors with appreciable property to nonetheless qualify for this system, Constantouros mentioned. That’s yet one more inhabitants that could be a goal for cuts.
Eliminating Medi-Cal protection for any Californian received’t make well being care prices go away. It should shift scheduled medical visits in workplaces to emergency rooms, the place hospitals by legislation should present that care no matter insurance coverage. And a technique or one other, a number of these prices get handed onto the identical taxpaying shoppers.
Undocumented immigrants don’t deserve a goal on their backs this funds season any greater than the remainder of the state’s residents. Personally, I’d choose that state {dollars} go to well being care than to rebates for electrical automobiles, as promised by the governor if Trump ends the federal program.
However this seems like probably the most unpredictable funds season going through Sacramento in a very long time. The latest drop within the inventory market, attributable to Trump’s spiking of tariffs throughout the globe, solely makes the income aspect of the ledger even bleaker in Sacramento. It’s going to check the fiscal values of Democrats and what they stand for many.
Tom Philp is a columnist for the Sacramento Bee. ©2025 The Sacramento Bee. Distributed by Tribune Content material Company.
