Fact Check: The New State Budget Reduces Costs for Healthcare For Illegals: FALSE

An “enrollment freeze” is not a cut — it maintains all of the program's costs in the new budget… And that doesn’t start until January…

Unpacking the Headlines

You have probably seen the recent reports claiming that California’s new state budget tackles a massive $12 billion deficit, in part, by dramatically slashing healthcare benefits for illegal immigrants. However, when you dig deeper into what happened, the truth tells a different story. Governor Gavin Newsom signed a budget last Friday that freezes new enrollment in Medi-Cal, our state’s version of the Medicaid program, specifically for illegal immigrants beginning next year. This means that the decision keeps current costs exactly where they are now—we are talking about roughly $11.1 billion yearly to cover 1.6 million already enrolled in the system (not counting increases in costs for providing healthcare, which ratchet up every year), rather than cutting those expenses down. While this future freeze might help limit future spending growth, there is a real possibility that we will see a massive surge of people rushing to sign up before the deadline hits, which could completely wipe out any potential savings. When you look at the facts, a headline about widespread cuts to taxpayer funded healthcare to illegal immigrants does not match what this policy will accomplish.

The Minimal Impact of the $30 Fee

In the budget is an aspiration $30 monthly premium that will kick in July of 2027 for illegal immigrant adults between 19 and 59 years old, and this fee has been getting quite a bit of attention in the news. But when you examine what this means financially, its actual effect is practically nothing. Consider this: Medi-Cal’s annual budget is more than $12 billion, so even if everyone supposed to pay this fee does pay it in full, we are talking about a contribution of less than 0.3% of the total budget. What makes this even more telling is that children will not face any charge whatsoever, which means their healthcare coverage stays completely intact. This tiny adjustment fails to make any real dent in the program’s massive financial burden, suggesting that it serves much more as a way to make a political statement than any serious attempt to save meaningful money. It is also worth mentioning that putting in place a fee that doesn’t start until two budgets from now means there is plenty of time for that fee to eliminated before it ever gets implemented. Obviously a fee that doesn’t start during this budget year provides no funds for this year’s budget.

Media’s Skewed Perspective

When you look at how the media has been covering this story, they keep pushing the narrative about significant healthcare cuts for illegal immigrants. Still, the reality is that this enrollment freeze keeps all existing benefits exactly as they are, instead of taking them away from anyone. Take “Newsom Signs Budget That Includes Health Care Cuts for Undocumented Immigrants” from The New York Times as a perfect example of this kind of misleading approach—this headline puts sensational drama ahead of telling people what is happening. The reporting ignores that no benefits are being reduced for people already in the program, and it glosses over the critical detail that children are completely protected from any changes. This reporting twists what the public understands about the situation, creating the impression of a significant crisis in places where the whole crisis does not exist.

Caveat - Overall Medicaid Reductions For All Recipients

I should mention, as a caveat, that this budget does have some reductions in the overall Medi-Cal program, which would obviously impact everyone covered, including citizens of other countries in the United States illegally, but that’s not what these news stories are highlighting. The clear implication is cuts to illegal immigrant healthcare.

Looking Ahead with Clarity

We already know that this state budget is filled with accounting gimmicks more than anything else, to technically balance it. But the way the media has talked about the cuts to illegal immigration health care, when there are none, should make us all ask hard questions about whether journalists are pushing their agendas instead of just reporting the facts. The people of California deserve honest, straightforward conversations about how we set our budget priorities and what those decisions will mean in the real world. And when state government spends more than it takes in, there is an expectation that there will be real, not rhetorical spending cuts.