California Gov. Gavin Newsom (D) released a new budget proposal Wednesday that suggests closing off free health care to illegal aliens in the Medi-Cal program, the state’s version of Medicaid, due to high costs.
Newsom acknowledged that the state faces huge budget deficits for the second year in a row, despite massive federally-funded surpluses before that — amounting to a $12 billion gap that the state government must fill.
As part of his plan to fill the hole, Newsom’s revised 2025-26 budget is proposing $5 billion in savings by barring new “undocumented” immigrants from joining Medi-Cal — though he said that existing enrollees would not lose their benefits.
CalMatters.org reported:
A year after granting Medi-Cal access to low-income immigrants without legal status, Gov. Gavin Newsom is proposing to freeze enrollment of new recipients and charge premiums in a move expected to save the state more than $5 billion.
Under Newsom’s proposal announced today, Medi-Cal — the state’s health insurance program for low-income people and those with disabilities — beginning in 2026 would no longer accept new enrollees 19 and older who lack permanent legal status.
The 1.6 million immigrants already signed up would not lose their Medi-Cal coverage, and children could still enroll. All undocumented Californians would still be covered for emergency medical and pregnancy care — so-called “limited scope” coverage that is paid for with federal dollars. But those who don’t enroll before January 2026 would be uncovered for other medical expenses, such as prescription drugs and doctor’s visits.
The San Francisco Chronicle elaborated:
Roughly a third of California’s nearly 40 million residents are covered by the program, which is available to people who make less than 138% of the federal poverty level — about $21,600 for an individual or $44,400 for a family of four. Earlier this year, the state had to appropriate billions in additional funding and take out a loan to cover growing Medi-Cal costs, including from increasing enrollment by senior citizens and rising pharmaceutical prices.
“The cost of the program is more than anticipated. It is unsustainable,” Erika Li, a top Newsom administration budget official, told lawmakers in April. “We are looking at ways to curb those costs.”
Politico noted Newsom’s reversal, adding that he tried to blame President Donald Trump:
The proposed reversal marks a significant retreat on an issue the governor has touted as being a linchpin in his goal of providing universal health care coverage in California. His success pushing through the initiative, which began in January 2024, helped solidify Newsom’s role as a progressive force in the Democratic politics. The back tracking will be a political gift to conservatives, who for months have been criticizing the program as excessively expensive and out-of-touch with what Californians want in tough economic times.
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Newsom tried to spin his decision to cut back on coverage for undocumented immigrants as one that will bolster Medi-Cal. “These changes are designed to preserve that commitment, protect coverage for millions of Californians, and preserve the strength of our values and health care system,” according to a fact sheet Newsom’s office circulated ahead of his budget presentation.
And the governor returned to a now familiar refrain, blaming President Donald Trump for unleashing the economic turmoil that forced his hand on the Medi-Cal cuts. Tariffs imposed by Trump, according to Newsom’s office, have decimated state revenues to the tune of $16 billion. Combined with existing budget problems, Newsom’s office said “the state must take difficult but necessary steps,” to bring down costs.
Newsom’s earlier policy of “free” health care for illegal aliens caused Medi-Cal to slide towards insolvency. The program was forced to borrow more than $6 billion earlier this year simply to stay financially afloat.
Joel B. Pollak is Senior Editor-at-Large at Breitbart News and the host of Breitbart News Sunday on Sirius XM Patriot on Sunday evenings from 7 p.m. to 10 p.m. ET (4 p.m. to 7 p.m. PT). He is the author of Trump 2.0: The Most Dramatic ‘First 100 Days’ in Presidential History, available for Amazon Kindle. He is also the author of The Trumpian Virtues: The Lessons and Legacy of Donald Trump’s Presidency, now available on Audible. He is a winner of the 2018 Robert Novak Journalism Alumni Fellowship. Follow him on Twitter at @joelpollak.
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