The future of America is often created, tested, and, more often recently, fails the formerly Golden State.
Gavin Newsom, California’s Democrat governor, recently announced California would start providing health care coverage to 764,000 more illegal immigrants in addition to 1.1 million who are already in the Medi-Cal system, which is California’s version of Medicaid.
Over one-third of the shrinking population of California’s 39 million people is enrolled in the Medi-Cal program.
California has increasingly added illegal immigrants since 2015 to the Medi-Cal program. That was the same year it made undocumented children eligible. After four years, it said adults 50 and older.
The most recent expansion adds those aged 26 to 49 at an estimated cost of $3.1 billion to California taxpayers — or around $4,058 per year in medical coverage subsidies from the General Fund of the state for individuals living in California illegally in this age group.
The federal government only legally underwrites Medicaid expenses for people in the United States.
Medi-Cal is the most significant part of California’s $454.7 billion budget, with the state providing about $40 billion from its General Fund and around $90 billion for health.
The Democratic leadership of California has sought to use its Medi-Cal program to move to universal health coverage slowly. They argue since all hospitals must provide emergency care services by federal law mandates, regardless of ability to pay or immigration status, it is more efficient and less costly to expand Medi-Cal coverage.
For example, an audit completed in 2021 in Texas found hospitals in the state spent up to $717 million to provide uncompensated hospital service for 1.6 million illegal migrants. This adds up to as much as $448 annually per person, a cost passed on to other hospital users.
However, coverage by Medi-Cal does not equal care. “It’s mind-numbing. California thinks itself a white knight for healthcare justice,” said Tanner Aliff, policy director for the Right on Healthcare at the Texas Public Policy Foundation. “Yet the state has failed to realize its Medicaid for All campaign has ironically reduced healthcare access for low-income folks living in rural counties. Between 2016 and 2019, California’s rural counties saw a drastic drop in the number of physicians accepting Medicaid.”
Increasing the problem, Aliff noted, “In 2023, the California Hospital Association claimed 1 in 5 hospitals are on the brink of closure due to losses from Medi-Cal. Medicaid is putting providers out of business, and there is no point in giving people taxpayer-funded Medicaid cards if there is nowhere to use them.”
But, with California facing a massive $68 billion budget deficit, the Democratic supermajority in each legislative house, and Newsom will have to find out how to trim the state’s spending by around 22% — a little less than it spends on K-12 public school education
GOP California Senator Roger Niello, vice-chairman of the Senate Budget and Fiscal Review Committee, said, “Along with my Republican colleagues, I have called on Governor Newsom and legislative leadership to take early action on the $68 billion budget deficit we face. As one necessary step in this direction, regardless of one’s position on this expenditure, it makes no sense to add this to that daunting shortfall.”
However, Governor Newsom may not be entirely out on a limb by spending taxpayer funds on illegal immigrants’ health care. This is because the Biden administration sees itself as having the power to declare illegal immigrants as lawfully being in the nation across the board.
The Biden administration announced last April its intent to declare illegal immigrants covered under the Deferred Action for Childhood Arrivals executive order as meeting the definition of having “lawful presence” during Obama’s presidency. This would make them eligible for Medicaid benefits. The action will likely save California about $1.1 billion in offsetting federal assistance.
Doing the same with millions of other illegal migrants might generate an additional $11 billion in federal California Medicaid assistance and provide a welcome federal bailout for California’s out-of-control spending.
The paperwork handed to them by Border Patrol is based on the theory that after they illegally entered the United States, it comprises a form of “lawful presence.” At the same time, they wait for their first hearing in front of an immigration judge.
This welcoming embrace of illegal immigrants funded by taxpayers may influence behavior. Nina Owcharenko Schaefer of the Heritage Foundation warns California’s generosity could cause migrants to move to California. It could, then, partially offset the mass migration from California to other parts of the state. California has now lost residents for three years in a row.