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California has spent more than a decade expanding Medi-Cal, extending coverage to millions of residents and significantly reducing the uninsured rate. That progress is now at risk.
Federal and state policy changes such as Medicaid work requirements, more frequent eligibility redeterminations, and new restrictions on immigrants will result in Californians losing Medi-Cal. The state Legislative Analyst’s Office estimates that up to 2 million Californians could become uninsured due to Medi-Cal and other health care coverage policy changes.
Covering fewer people won’t reduce their care needs. Californians who lose coverage will instead need to rely on emergency rooms and a patchwork of safety-net options, such as county indigent care programs. The big question is how California will go about ensuring access to health care — and how much that will depend on which county a person happens to reside in.
The California Health Care Foundation partnered with the consulting firm Health Management Associates (HMA) to examine state policy options for maintaining access to care. Specifically, they focused their modeling on the population of Californians who would otherwise have been eligible for Medi-Cal if not for recent policy changes. The resulting analysis presents cost estimates for statewide care programs and highlights trade-offs in benefits, provider access, and cost sharing. This analysis is intended to inform near-term discussions during this ongoing period of uncertainty surrounding restoration of broader eligibility for full-scope Medi-Cal benefits.
Who Could Lose Coverage
The people most affected by this situation include adults with low incomes enrolled in Medi-Cal through the Affordable Care Act expansion, particularly individuals who may face challenges satisfying work requirements or completing more frequent enrollment renewals. Immigrants who were covered through state-funded expansions are also at risk, because they have no federally subsidized alternatives to provide comprehensive coverage.
What Coverage Loss Would Mean
Medi-Cal provides comprehensive care, such as primary and specialty services, hospital care, prescription drugs, behavioral health treatment, dental and vision care, and long-term supports. Losing that coverage disrupts access across the continuum of care. As more people become uninsured, safety-net providers, including hospitals, community clinics, and county indigent care systems, likely will see increased demand and higher levels of uncompensated care. Public hospitals and county health systems, often the providers of last resort, would face the greatest strain.
Policy Options for the State
Drawing on the state’s current and past coverage models, CHCF and HMA modeled two program options for Californians at risk of losing coverage. Designing alternative programs involves trade-offs: Costs and access shape choices about benefits, cost sharing, provider payment rates, and the length of “bridge” coverage for people disenrolled from Medi-Cal due to work requirements and more frequent eligibility determinations.
Two illustrative options highlight these trade-offs.
Option 1 ($4.6 billion annually). A comprehensive approach that includes the essential health benefits covered by state marketplaces, no cost sharing by patients, current provider payment rates, and a three-month “bridge” program.
Option 2 ($3.1 billion annually). A lower-cost model based on the state’s earlier Low Income Health Program, with more limited benefits, lower provider payments, a shorter coverage “bridge,” and modest cost sharing by enrollees.
Maintaining full Medi-Cal coverage would cost an estimated $6.7 billion annually.
Implications for the Safety Net
Coverage losses won’t reduce the need for care — they will shift it. Without coverage, people often must delay care until conditions worsen, which increases reliance on emergency departments and hospitals. These unavoidable costs are absorbed by community clinics, hospitals, and county indigent care systems, further straining an already stretched safety net.
This dynamic suggests the need for a statewide approach. County-by-county solutions would create uneven access and widen disparities in rural and under-resourced areas. A statewide strategy can provide more consistent coverage, operate at scale, and build on Medi-Cal’s existing infrastructure to protect access and reduce pressure on the safety net.
