The entrance to Planned Parenthood at 710 N Cherry Street in Knoxville, Tenn., on Wednesday, November 13, 2024.
Sacramento, California – Governor Gavin Newsom’s proposed $322 billion state budget for the 2025-26 fiscal year includes a controversial $500 million cut to health care provider payments funded through Proposition 56, a move that has drawn sharp criticism from Planned Parenthood and other health advocates.
The proposed cuts specifically target incentive payments to providers serving patients on Medi-Cal, California’s Medicaid program that covers roughly 15 million low-income residents. These payments, funded through the 2016 voter-approved Proposition 56 tobacco tax, have been instrumental in expanding access to dental, family planning, and women’s health services.
Planned Parenthood Affiliates of California warned the reduction would slash a third of its annual state funding, severely limiting access to essential care for underserved populations. “Over 85% of our patients are on public programs, including Medicaid,” said Jodi Hicks, President and CEO of Planned Parenthood California. “This effectively defunds Planned Parenthood in the state of California.”
The $500 million cut is part of Newsom’s effort to close a projected $12 billion budget shortfall. The governor also proposed canceling an additional $900 million in planned increases to Proposition 56 provider payments in the coming years. Newsom intends the cuts to offset the costs of Proposition 35, a voter-mandated measure that expands Medi-Cal coverage and adds $4.6 billion in spending over the next two fiscal years.
Newsom defended the decision, saying the state is facing difficult fiscal choices. “Because of Prop 35 and the fact that it is burdened over the next two fiscal years by $4.6 billion, it’s increased the budget deficit,” he said. “We are trying to figure out ways of offsetting that.”
The backlash has been swift. Hicks posted on social media, “Happy to go on [Newsom’s] Podcast and explain why this devastates women’s health in his state.” State Representative Maggy Krell echoed the concern, writing, “At a time when access to reproductive healthcare is under attack & Congress is proposing to defund Planned Parenthood & cut Medicaid, California must do more.”
The governor’s office responded to criticism, with spokesperson Izzy Gardon stating that “any suggestion [that Newsom] would shut down health clinics across California is laughably absurd.” Gardon emphasized that Newsom remains committed to protecting reproductive health access.
As budget negotiations continue, Newsom and Democratic lawmakers are under increasing pressure to reconcile fiscal constraints with the state’s progressive health care agenda. The outcome will test California’s promise to protect its most vulnerable residents amid economic uncertainty.
