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$12 Billion deficit forces California to cut off new Medi-Cal access for immigrants

Jacob Shelton June 13, 2025

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Workers harvest green leaf lettuce at Roth Farms on January 9, 2025 in western Palm Beach county, Florida.

Sacrament0, California – California lawmakers are preparing to vote Friday on a proposal that would freeze enrollment in Medi-Cal, the state’s Medicaid program, for low-income adults without legal immigration status. The move comes as California faces a $12 billion budget deficit—its third consecutive year in the red—and Democratic leaders search for ways to preserve key services while scaling back some of their most ambitious policy goals.

The proposal, modeled on but less severe than Governor Gavin Newsom’s May budget plan, would stop new applications to Medi-Cal for undocumented adults starting in 2026. Those already enrolled would be allowed to stay on the program but would begin paying monthly premiums in 2027—$100 under Newsom’s plan, though lawmakers now propose lowering it to $30 for adults aged 19 to 59.

The enrollment freeze targets a program that currently covers more than 1.6 million Californians without legal status, a population that advocates say is deeply integrated into the state’s economy but remains politically vulnerable. The freeze could save the state approximately $3.8 billion by the 2027–2028 fiscal year.

Democratic lawmakers are walking a narrow line between progressive ideals and fiscal realities. Though California was one of the first states to extend free health care coverage to undocumented adults—a cornerstone of its push toward universal care—the cost has exceeded expectations and continues to rise.

“This is no way to respond to concerns about the health and safety of communities that power our economy and contribute billions in state taxes,” said Masih Fouladi, Executive Director of the California Immigrant Policy Center.

While the proposal has drawn criticism from within the Democratic ranks, legislative leaders have also pointed to areas where they resisted deeper cuts. Lawmakers rejected Newsom’s plans to slash funding for in-home care services and Planned Parenthood, moves that would have disproportionately impacted the state’s most vulnerable residents.

Still, the decision to curtail Medi-Cal enrollment has exposed a rift between economic pragmatism and political promises. “People have already a decreased amount of trust in government and when we continue to go back on our words, it makes it even harder,” said State Sen. Caroline Menjivar, a Democrat.

Tensions around immigration remain high, especially in Southern California, where protests have erupted in response to President Donald Trump’s recent crackdown. Amid those demonstrations, California has sued the federal government to halt the deployment of National Guard troops, while continuing to grapple with the downstream effects of economic and federal policy uncertainty.

Though not yet final, lawmakers must pass a balanced budget by Sunday or risk forfeiting their salaries.

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