California Democrats Expanded Medicaid to Illegal Immigrants and It’s Not Going Well

Just over a year ago, California became the first state in the US to offer Medicaid benefits to illegal immigrants. This was actually the final step in a process that Democrats have rolled out over the past decade.

In 2015, undocumented children were able to join Medi-Cal under a bill signed by then-Gov. Jerry Brown. In 2019, Gov. Gavin Newsom signed into law an expansion of full-scope Medi-Cal access for young adults ages 19 through 25, regardless of citizenship or immigration status. Access was then further expanded to allow older adults aged 50 and older to receive full benefits, also regardless of immigration status.

The final expansion going into effect Jan. 1 will make approximately 700,000 undocumented residents between ages 26 and 49 eligible for full coverage, according to California State Sen. María Elena Durazo.

“This historic investment speaks to California’s commitment to health care as a human right,” Durazo said in a statement in May.

As mentioned, the final step began in January 2024 so we’ve had just over a year to look at the results. You’ll be shocked to learn that this program is turning out to be billions of dollars more expensive than predicted.

California became the first state in the nation to offer healthcare to all income-eligible immigrants one year ago, which gave Gov. Gavin Newsom another liberal achievement to tout when lauding the Golden State as a national trailblazer.

But the $9.5-billion price tag of California’s program is already more than $3 billion above the budget estimate from last summer and is expected to grow even higher. In Sacramento, the governor and Democrats in the state Legislature now are under pressure to reduce coverage to bring down costs during a budget crunch…

The cost estimate to provide coverage to all-income eligible undocumented immigrants was $6.4 billion in the 2024-25 state budget approved last summer, which marked an increase from earlier projections.

In February, the Newsom administration told lawmakers at a budget hearing at the state Capitol that the cost of expanding coverage to all immigrants for the current year had ballooned again from $6.4 billion to $9.5 billion. The California Department of Finance attributed the increase to “higher-than-anticipated enrollment, and higher pharmacy costs.”

So the best estimate last summer turned out to be short $3 billion. Now the Department of Finance is asking for a $3.4 billion loan from the general fund to cover the shortfall. That will cover Medical’s shortfall through the end of the month.

California will need to borrow $3.44 billion to close a budget gap in the state’s Medicaid program, Newsom administration officials told lawmakers Wednesday in a letter obtained by POLITICO.

That’s the maximum amount California can borrow, and will only be enough to cover bills for Medi-Cal — the state’s Medicaid program — through the end of the month, Department of Finance spokesperson H.D. Palmer separately told POLITICO.

State Assembly Speaker Rober Rivas has already vowed not to cut benefits for non-citizens.

Assembly Speaker Robert Rivas said he’s proud of the state’s efforts to expand Medi-Cal to all regardless of immigration status.

“There are tough choices ahead, and Assembly Democrats will closely examine any proposal from the Governor,” Rivas said in a statement. “But let’s be clear: We will not roll over and leave our immigrants behind.”

One Republican had questioned the spending last month and Speaker Rivas then removed him from his committee assignment.

California’s Democratic Assembly Speaker Robert Rivas has decided to remove some of the most vocal Republican lawmakers from their leadership and high-profile committee roles at the State Capitol.

Rivas sent out a two-page memo Friday night announcing the reshuffling of Republicans without specifically stating why. The memo showed he stripped the roles from a handful of lawmakers who have recently been outspoken about how the state’s Democratic supermajority has handled state spending and proposed state laws…

Riverside Assemblyman Carl DeMaio has been removed from the Assembly’s Budget Subcommittee that focuses specifically on Newsom’s administration’s spending. He has been a vocal critic of state spending. He recently got the Newsom administration to publicly disclose for the first time that the state will likely spend billions more than it expected providing health insurance to undocumented people with $9.5 billion…

“Just another day in this corrupt institution,” DeMaio said. “We face a budget crisis, and the voters are angry about what’s going on with their money. Mr. Speaker, I hope you can hear me, I’m not backing down.”

This is how things operate in California. Here’s the letter asking for the $3.44 billion loan.

New: Gov. Newsom’s Dept. of Finance notified CALeg it needs a $3.44 billion loan for Medi-Cal.

Letter doesn’t say it, but state leaders expanded Medi-Cal last year to provide health insurance to undocumented people.

The administration underestimated how much that would cost. pic.twitter.com/EoKEGsh5VC

— Ashley Zavala (@ZavalaA) March 13, 2025

This outcome was entirely predictable and in fact Republicans predicted it a year ago, to no avail.

Medi-Cal is officially BROKE because of illegal immigrant healthcare. The Dept. of Finance just requested a $3.4 billion loan to meet its budget shortfall for just this year. I have been sounding the alarm on free healthcare for illegal immigrants because there is NO LIMIT to how… pic.twitter.com/JNn5lcPeI2

— Bill Essayli (@billessayli) March 13, 2025

Of course none of this matters to Democrats. They are locked into this now because it’s Gavin Newsom’s baby and turning their backs on it simply because it’s vastly more expensive than advertised wouldn’t look good for a future presidential candidate.