California lawmakers learned recently that the state will require a $3.4 billion loan to cover rising expenses for Medi-Cal, the state’s Medicaid program that now provides health coverage to over 15 million residents. The announcement has intensified political debate over the program’s recent expansion to include undocumented immigrants.
Republican Assembly Member Carl DeMaio warned that the loan signals more profound financial instability ahead. “This is only the first of many loans that will have to be made if we continue to give free taxpayer-funded handouts for health care to illegal immigrants,” DeMaio told CBS 8, calling on Governor Gavin Newsom to halt Medi-Cal coverage for undocumented individuals.
According to the California Department of Finance, the state is expected to spend $9.5 billion on Medi-Cal coverage for undocumented immigrants, with $8.4 billion coming from California’s general fund. This is well above the initial $6 billion projection.
However, immigrant rights advocates argue that the financial strain on Medi-Cal goes beyond its immigrant population. “This has nothing to do with undocumented individuals,” said Enrique Morones, a longtime activist. He cautioned that efforts to strip coverage could deter immigrants from seeking care, leading to delayed treatment and higher costs in emergency rooms.
In response, the Governor’s Office emphasized that rising Medicaid costs are a national issue, not unique to California. “States like Pennsylvania, New Jersey, and Indiana are also facing similar challenges,” a spokesperson noted. They attributed California’s growing Medi-Cal costs to several factors, including:
- Higher-than-expected post-pandemic enrollment
- An aging population
- Escalating costs for hospital care and prescription drugs
- And yes, the program’s expansion, though not the sole cause
It’s worth noting that federal law prohibits using federal Medicaid funds for undocumented individuals, meaning California must fund that coverage entirely with state dollars.
As the debate continues, the state faces tough questions about balancing compassionate healthcare access with financial sustainability, especially in the face of future budget pressures.
