California legislators are set to cast votes on a budget proposal that would halt enrollment in a state-funded health program for undocumented immigrants to address a $12 billion budget deficit.
This revised plan is a trimmed version of Governor Gavin Newsom’s initiative introduced in May. California currently faces its third consecutive year of budget deficits, compelling Democratic leaders to reduce several progressive policies, including a significant healthcare expansion for low-income undocumented adults.
The prospect of this vote has stirred tension amidst ongoing protests in Southern California related to President Donald Trump’s immigration policies. During recent demonstrations in Los Angeles, some clashes with law enforcement occurred, prompting Trump to redeploy over 4,000 National Guard members and 700 Marines, despite pushback from local officials. However, most of the protests remained peaceful, and California has urged the federal government to halt the military reinforcements.
This freeze on Medicaid registration illustrates the challenges faced by Democratic leaders striving to uphold progressive goals in the face of financial constraints. Like California, states such as Illinois and Minnesota are also poised to limit healthcare access for low-income undocumented adults amid budget woes.
The finalized budget is still pending, as Governor Newsom and legislative leaders continue negotiations ahead of the new fiscal year starting July 1. Lawmakers are required to approve a balanced budget by this Sunday, while Democratic leaders are also grappling with various economic uncertainties, including possible federal healthcare cuts and tariffs that could necessitate even deeper reductions.
Republican legislators argue that Congressional budgets are insufficient to manage future expenses and deficits.
“We have a fundamental shortfall in our ongoing programs, and we’re bringing in more revenue than we’re spending,” remarked Sen. Roger Niero. “Nothing has changed that.”
Program Suspension and Premium Adjustments
According to the budget, the state currently provides healthcare to over 1.6 million undocumented individuals this fiscal year.
Under Newsom’s revised plan, starting in 2026, low-income adults without legal status will no longer be able to apply for Medi-Cal, California’s Medicaid program. Those already enrolled will face a new monthly premium of $100 in 2027.
While lawmakers generally agreed to pause registrations for adults without legal status, the proposal allows for re-enrollment within six months if individuals lose coverage due to non-payment. Additionally, the monthly premium is set to decrease by about one-third to $30, applicable only to adults aged 19 to 59 under federal guidelines. This approach aims to save around $3.8 billion by the fiscal year 2027-2028.
Supporters of the initiative express concerns that these changes will lead to coverage loss, as people may struggle to pay premiums, ultimately affecting emergency room visits.
“This approach doesn’t support our economy or ensure community health and safety for those contributing billions in state taxes,” stated Masifrady, executive director of the California Center for Immigration Policy.
The Divide Among Democrats
California was among the first states to extend free healthcare to all low-income adults, regardless of immigration status. Newsom aimed to push the state closer to universal healthcare goals, yet costs continue to escalate beyond initial projections, requiring more funds than expected.
Currently, the state provides free healthcare to over a third of its 39 million residents.
Several Democrats have voiced that the Medicaid registration freeze contradicts California’s core values and that Congress has not upheld its commitments to taxpayers.
“People are losing confidence in their government. Returning to prior commitments makes things even harder,” commented Sen. Caroline Menzibal during the recent hearing on the proposal.
Democratic state Sen. Akira Weber Pearson defended the budget plan, arguing it does not reduce benefits for existing enrollees. Lawmakers have also rejected Newsom’s suggestions to cut funding for programs supporting domestic and personal care services for low-income individuals and those with disabilities, as well as a proposed one-third reduction in Planned Parenthood funding.
“No one currently covered will lose their health care benefits,” she assured.
