Newsom's proposed Medi-Cal freeze for undocumented immigrants sparks outrage
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Gov. Gavin Newsom speaks at Chateau Marmont in West Hollywood. Photo: Michael Buckner/Variety via Getty Images
Gov. Gavin Newsom — who in 2019 ran on the promise of universal healthcare — has proposed freezing enrollment in the state-funded healthcare plan for undocumented immigrants and imposing new premiums to the program amid a severe budget deficit.
Why it matters: Newsom's proposal — which he said could help save California about $5 billion by fiscal year 2028-29 — marks a stunning reversal from last year's first-in-the-nation move to expand free healthcare access for low-income residents without legal status.
Follow the money: The state is now staring down a $12 billion deficit in its proposed $322 state budget for 2025-26, a stark outlook requires making "difficult" long-term planning decisions "in a time of just extraordinary uncertainty," Newsom on Wednesday.
The big picture: In addition to unexpectedly high Medi-Cal costs, Newsom blamed the deficit on economic instability prompted by federal tariffs. The state's finances are also particularly sensitive to fluctuations in capital gains tax revenue.
Between the lines: Medi-Cal, the state healthcare plan for disabled people and low-income residents, would prevent new undocumented enrollees age 19 and older from accessing benefits beginning in January, beyond emergency and pregnancy care.
- Dental coverage and long-term care options would also be cut.
- Newsom also wants to begin charging a $100 monthly premium for existing undocumented Medi-Cal participants starting in 2027 to help raise funds for the cost-burdened program.
By the numbers: Expanding Medi-Cal for undocumented residents has cost an additional $8.5 billion annually, per a February state budget hearing.
- There are nearly 15 million Medi-Cal enrollees, including an existing 1.6 million undocumented immigrants whose coverage would remain intact. Undocumented children would also still be eligible to sign up, Newsom said, adding that the state remains committed to supporting immigrants.
- "No state will continue to do more than the state of California by a long shot — and that's a point of pride," he said.
The other side: Newsom's proposal has sparked outrage from advocates who say the changes could have severe implications for the state's estimated 2.6 million undocumented immigrants.
- "This is a betrayal of the governor's commitment to California immigrants," Amanda McAllister-Wallner, executive director of Health Access California, said in a statement.
- "At a time when our health care and immigrant communities are under attack from the federal government, we should be able to take our California elected officials at their word that they will protect our communities."
Zoom in: In former House Speaker Nancy Pelosi's congressional district, which encompasses most of San Francisco, about 26% of the population depends on Medi-Cal benefits, according to the state dashboard.
- That includes many of the estimated 43,000 or so undocumented immigrants living in the city, who are ineligible for federal options like Medicaid.
The intrigue: Newsom's call to freeze Medi-Cal eligibility comes amid the Trump administration's growing scrutiny over state-funded benefits for undocumented residents, including an investigation into California's cash assistance program for immigrants.
What we're watching: State Sen. Scott Wiener told Axios that the Legislature will be looking at "many different options" in the weeks ahead and may be able to find other cuts to avoid scaling back health care coverage, though "balancing a budget during a deficit year is always painful."
- "Undocumented Californians should have access to health care. With that said, we also have a big budget deficit and our Medi-Cal costs are higher than anticipated. We will have our own proposal and negotiate a resolution with the governor," he added.
What's next: The Legislature has until June 15 to finalize the state budget.