California Retreats From Its Health Coverage Gains, Leaving Millions at Risk
Two years ago, California came closer than almost any state in the nation to guaranteeing health coverage for all its residents. Regardless of immigration status or income, nearly everyone qualified for some form of insurance, pushing the state’s coverage rate to a historic 95%. That achievement is now eroding fast.
Faced with persistent budget deficits and a wave of new federal restrictions, state leaders have begun dismantling pieces of the system they spent more than a decade building. According to research from the UC Berkeley Labor Center and the UCLA Center for Health Policy Research, California’s uninsured rate could nearly double by 2030, climbing toward 15%.
“I knew it was going to be bad, but seeing that doubling was shocking to me,” said Miranda Dietz, who directs the labor center’s healthcare program.
Researchers estimate that roughly 2.2 million Californians could lose coverage over the next four years because of combined state and federal cuts. The impact will land hardest on undocumented immigrants and low-income residents, with uninsured rates more than doubling among Black and Asian Californians. Southern California, home to large populations of immigrants and low-wage workers, is expected to feel the sharpest losses.
For many longtime residents, the rollback recalls an era before the state’s coverage expansions, when getting basic medical care was a struggle.
In 2008, Kandi Hill had just given birth to her third child when she began experiencing vomiting and abnormal, heavy bleeding. Doctors were reluctant to test her for anything beyond sexually transmitted infections. Within months, she was diagnosed with stage four cervical cancer and died at age 31.
Cervical cancer has a 91% five-year survival rate when caught early, according to the National Cancer Institute. But at the time, Medi-Cal offered minimal coverage, and her husband, Ramonte Means, believes doctors simply didn’t take a low-income Black patient’s symptoms seriously.
Means was left to raise their three children — including an infant — on his own. He has worked ever since, often juggling multiple part-time jobs in janitorial services, customer service and job coaching. Employers, he said, frequently limit his hours specifically to avoid offering benefits. To keep his family covered under Medi-Cal, he has had to be careful about how much he earns, since a full-time job with higher pay could push his income above the eligibility threshold — while still leaving him unable to afford private insurance.
“None of us want anything for free. I work two jobs. My kids go to school,” Means said. “We’re just asking for some dignity.”
He said today’s Medi-Cal, despite its shortcomings, offers far more than what was available when his wife was sick — better access to specialists and expanded benefits.
“I truly believe if all this happened now, she’d have been fine,” he said. “The system failed my kids more than anything — failed the whole family.”
**How California Expanded Coverage**
California’s push toward near-universal healthcare began with the Affordable Care Act in 2010. The state quickly broadened its Medicaid program, known as Medi-Cal, which previously served mostly women, children, seniors and people with disabilities. Under the new law, childless low-income adults became eligible, and the income cutoff rose to 138% of the federal poverty level — about $22,000 a year for an individual today.
More than 5 million Californians, including Means, gained coverage as a result.
“So 138% poverty is not a lot of money in terms of increasing income, but when you talk about how many people actually become eligible, it has a significant impact,” said Nadereh Pourat, associate director at the UCLA Center for Health Policy Research.
Another 1.7 million middle-income residents purchased private plans through Covered California, the state’s Affordable Care Act marketplace.
“That’s a huge policy change,” said Rachel Linn Gish of Health Access California, a consumer advocacy organization. “Millions and millions and millions of Californians covered in 10 years. No other state can say that.”
One group remained excluded, however: California’s roughly 2.3 million undocumented residents, according to the Public Policy Institute of California.
**Newsom’s Health Care Legacy**
Gov. Gavin Newsom ran for office promising a single-payer healthcare system. He ultimately shifted strategies, choosing instead to expand and strengthen Medi-Cal from within — adding new benefits and emphasizing primary care access.
His administration also oversaw the state’s second-largest coverage expansion, gradually extending Medi-Cal eligibility to undocumented adults until, by 2024, all income-eligible adults and children qualified regardless of immigration status.
“We’re making sure that universal access to healthcare coverage becomes a reality here in California,” Newsom said in 2022, when undocumented seniors first became eligible for Medi-Cal.
At its height, the expansion covered 1.4 million adults and 217,000 children, at an annual cost exceeding $10 billion.
That price tag has drawn sustained criticism from Republicans — and increasingly from moderate Democrats as well.
“We need to have cost containment,” said state Sen. Catherine Blakespear, D-Encinitas, during last year’s budget debate.
Overall Medi-Cal spending has more than doubled since Newsom took office in 2019, rising from about $96 billion to $217 billion this year. The nonpartisan Legislative Analyst’s Office attributes most of that growth not to enrollment increases, but to higher costs per patient — expanded benefits, rising drug prices and demographic shifts — along with more frequent, costlier doctor visits.
**New Cuts Take Hold**
Orlando and Lourdes, immigrants from El Salvador now living in Los Angeles, asked to be identified only by their middle names out of fear of immigration enforcement. Orlando has lived in the region for more than two decades and works in construction under a work permit; Lourdes, who is undocumented, manages a retail store.
Recent immigration raids have already reshaped their family’s daily life — they’ve had to explain to their 6-year-old daughter the difference between “good police” and “bad police.” Now Lourdes, who requires radiation treatment for cancer, fears losing her Medi-Cal coverage altogether.
In January, the state froze new Medi-Cal enrollment for undocumented adults in an effort to control costs, resulting in roughly 86,000 fewer covered immigrants.
Beginning next summer, undocumented immigrants will lose dental benefits and be required to pay new monthly premiums. Combined with cuts affecting some legal immigrants, these changes are expected to push about 800,000 people off Medi-Cal, according to the UC Berkeley Labor Center.
“We pay taxes every year. We deserve to have health insurance,” Orlando said.
Other services have been scaled back as well. Last year, the state stopped covering weight-loss medications such as Ozempic for patients who are simply overweight, limiting coverage to more serious diagnoses like diabetes. This year, lawmakers trimmed case management services and medically tailored meal deliveries for low-income patients, and reinstated an asset test that limits how much savings a Medi-Cal recipient can hold — a policy critics say penalizes people for trying to build financial stability.
These changes have drawn pushback from progressive lawmakers who argue the state should raise revenue through new taxes rather than cut healthcare access.
State Sen. Lena Gonzalez, D-Long Beach and chair of the Legislature’s Latino Caucus, said she personally lobbied Newsom’s administration twice to preserve benefits for undocumented residents.
“I said this is legacy work for you, and I don’t want you to ever forget that,” Gonzalez said. “For this to happen was just really surprising.”
Linn Gish said Newsom deserves credit for backing healthcare expansion “from day one” but expressed disappointment over the recent cuts. “We hoped he would be a champion until the end,” she said.
Newsom’s office declined to comment directly. In a statement, the state Department of Health Care Services noted that the Legislature approved the budget containing the cuts and said the governor remains committed to “responsibly” pursuing universal coverage.
“Gov. Newsom has consistently highlighted California’s coverage gains as central to his broader commitment to universal healthcare coverage and a more inclusive safety net,” the statement read.
**Pressure From Washington**
Many Democrats, including Newsom, point to President Donald Trump’s tax and spending legislation — dubbed the One Big Beautiful Bill — as a major driver of the crisis. The law rewrote Medicaid rules nationally and reduced federal funding to California. It also allowed enhanced Affordable Care Act subsidies to expire, contributing to a 140,000-person drop in Covered California enrollment. State officials project Medi-Cal could lose more than $30 billion annually once the federal changes are fully implemented in 2027.
Among the most significant shifts: many adults will now be required to prove they are working or volunteering at least 80 hours a month to keep coverage. Research shows most low-income adults already meet such requirements, but many still lose coverage due to paperwork errors and administrative hurdles.
“All it takes is one piece of lost mail and all of a sudden you lose coverage … and things can snowball,” said Dylan Roby, a health policy researcher at UC Irvine.
Combined with shortened eligibility periods, the state projects these federal changes alone could cause 1.3 million people to lose coverage over the next four years — with Los Angeles and other parts of Southern California likely to see some of the steepest declines. The Labor Center also projects that Latino Californians will lose coverage at a faster rate than other groups.
Linnea Koopmans, CEO of Local Health Plans of California, which represents Medi-Cal managed care organizations, warned that the cumulative effect of state and federal cuts risks creating a two-tiered healthcare system.
“There’s a lot at stake and a lot to be lost,” Koopmans said.
Not everyone agrees that Washington bears the primary blame. Some Republican lawmakers argue California’s fiscal troubles predate the federal changes, noting the state has run budget deficits for four consecutive years — well before most federal restrictions have even taken effect.
State Sen. Roger Niello, R-Roseville and vice chair of the Senate budget committee, estimated the current financial impact of federal healthcare restrictions at about $3 billion within a $351 billion state budget.
“It’s difficult (to argue) that the woes are being caused by the federal government,” Niello said, characterizing California’s fiscal challenges as structural — spending, he said, has consistently outpaced even growing state revenues.
The current state budget defers the most difficult healthcare decisions to whoever succeeds Newsom as governor.
“Gov. Newsom says he solved the deficit for the next governor,” Niello said. “He hasn’t.”
Original source: CalMatters
