California is $3.44 billion short on its Medi-Cal funding in part due to expanding the program’s access to illegal immigrants.
The California Department of Finance sent a letter to state lawmakers on Wednesday saying the state will need to borrow $3.44 billion to fund the program.
Driving the news: California first started covering non-citizen children with Medi-Cal in 2016, expanding it to young adults in 2020 and eventually to everyone last year.
- Last year the state estimated covering illegal immigrants under Medi-Cal would cost around $3 billion annually.
The big picture: The price to cover illegal immigrants under Medi-Cal quickly ballooned far past the initial expectations.
- Gov. Gavin Newsom proposed $8.4 billion in his current budget proposal to cover illegal immigrants in Medi-Cal in 2024-2025 and $7.4 billion the following year.
- The $3.44 billion loan will only be enough to fund Medi-Cal through the end of the month, according to a report from Politico.
What they’re saying: Assembly Leader Robert Rivas (D–Hollister) made it clear that the state will continue to cover illegal immigrants despite the shortfall.
- “There are tough choices ahead, and Assembly Democrats will closely examine any proposal from the Governor,” Rivas said in a statement. “But let’s be clear: We will not roll over and leave our immigrants behind.”
- Senate President pro tempore Mike McGuire (D–Healdsburg), Majority Leader Lena Gonzalez (D–Long Beach) and Budget Chair Scott Wiener (D–San Francisco) said in a joint statement that they will work with the Assembly and Newsom to find long-term solutions.
- “Here in the Golden State, we remain steadfast in our commitment to ensuring millions of Californians have the healthcare coverage they need to thrive,” They said. “That access to healthcare is being threatened by skyrocketing healthcare costs across the nation, and even more by the dangerous cuts threatened by President Trump and Congressional Republicans that will impact the lives of tens of millions across this country.”
- A Newsom spokesperson said the financial issues with Medi-Cal are not unique to California since rising Medicaid costs are a national challenge.
Republicans react: Assembly minority leader James Gallagher (D–Yuba City) laid the blame for the shortfall at the feet of Newsom and the Democratic supermajority.
Unbelievable! The mismanagement continues. Now they want a loan? We said it then and we’ll say it again: we can’t afford the failed leadership of @GavinNewsom and the Democratic supermajority. https://t.co/p3kbE5ff0I— James Gallagher (@J_GallagherAD3) March 13, 2025
- Senate minority leader Brian Jones (R–Santee) said on X that Republicans demand a full hearing on the issue.
Typical of the secretive Newsom Administration, they just quietly dropped a damning notification that they are taking a $3.44 BILLION loan to fund free healthcare for illegal immigrants.
The loan is being taken from tax dollars meant for healthcare providers.
This program is… pic.twitter.com/5c6wX7ukHa— Brian W. Jones (@SenBrianJones) March 13, 2025
