March 15, 2025 Newswires

Susan Shelley: Medi-Cal under strain after state extends aid to illegal immigrants

Susan Shelley, Los Angeles Daily NewsDaily News

The Newsom administration just informed the Legislature that it needs to borrow $3.4 billion to pay unexpectedly high costs for Medi-Cal, the state’s safety-net health insurance program for low-income residents that is now open to all undocumented immigrants.

As of Jan. 1, 2024, everyone in California who is in the country illegally is entitled to “full-scope” Medi-Cal: unlimited, unrestricted, full, free health insurance, as long as their reported income is low enough to be eligible.

But wait, there’s more.

Generally, California can seek reimbursement from the federal government for half of its Medi-Cal expenses. Not always. Federal law forbids reimbursement for care provided to illegal immigrants, other than the limited services available to everyone under “emergency Medicaid,” also known as “restricted-scope Medicaid.”

In California, the Medicaid program is called “Medi-Cal,” as if to warn everyone that it’s going to be bad at math.

And it is, like, totally bad at math. In Southern California that’s pronounced “baahd at maath.” Fer sherr.

It’s so bad at math that the government initially calculated it would cost between $2 billion and $4 billion annually to provide full-scope Medi-Cal to every income-eligible undocumented immigrant in the state. By last summer the estimate was $6.4 billion, and most recently Assemblyman Carl DeMaio, R-San Diego, got a Department of Finance official to admit during a budget hearing that it’s $9.5 billion.

In gratitude for this helpful update, Speaker Robert Rivas, leader of the Democratic supermajority in the Assembly, threw DeMaio off the Budget Committee.

We are baahd at maath here. Get away with your accurate assessments.

But then Gov. Gavin Newsom’s Department of Finance sent a letter informing the legislature that it had to borrow $3.4 billion to cover higher Medi-Cal expenses through the end of March.

Like, oh my Gahd. What are they going to do after March?

Borrow more, probably.

At this point you may be wondering, “How will this loan ever be repaid?”

Oh my Gahd, it’s another rilly hard maath question. Like, no way.

No way can the Medi-Cal program pay for unlimited health care services for an unlimited number of people from all over the world for the rest of their lives.

Nearly all of these expenses are billed to the exhausted taxpayers of California. The federal government provides partial funding only for “restricted scope” Medicaid benefits, such as emergency and pregnancy-related services.

California began its Medi-Cal expansion to undocumented immigrants in 2015 with coverage for children up to 18 years old. Young adults ages 19-25 became eligible in 2019, then in 2022 eligibility expanded to include adults 50 and older. Adults ages 26-49 were added in 2024. Participants are covered for everything from neo-natal through long-term care, free.

California doesn’t even have the distinction of being the first state to march off this fiscal cliff. That title belongs to Oregon, where the Healthier Oregon program has been offering full Medicaid-like health coverage to all undocumented immigrants since July 2023. The Oregon Health Authority had previously calculated that there were 55,000 eligible individuals and 80% would enroll. By mid-2024, the OHA reported that more than 100,000 people were on the program.

Only California and Oregon were dippy enough to sing two choruses of “We Are the World” and open their state treasuries without limitation. But other states have offered additional health care benefits to some undocumented residents.

In Illinois, the Health Benefits for Immigrant Seniors (HBIS) program has been providing coverage to undocumented immigrants age 65 and older since December 2020, and the Health Benefits for Immigrant Adults (HBIA) program added adults age 42-64 in 2022.

How’s it going?

The Illinois legislature ordered the state’s auditor to find out. He reported in February that in fiscal year 2023, the HBIS program had 15,831 enrollees, not the 6,700 that had been estimated. The HBIA program serving adults ages 55-64 had 17,024 enrollees, not 8,000 as expected. And the program for undocumented immigrants ages 42-54 had 36,912 enrollees, almost double the 18,800 that state officials had projected.

The costs for the three segments of the program were higher than expected by 84%, 282% and 286%, respectively. HBIS and HBIA have cost Illinois taxpayers $1.6 billion so far.

That’s a cute number, isn’t it? California borrows more than that for breakfast.

Faced with surging costs for the HBIS and HBIA programs, Illinois officials paused new enrollments in 2023, while maintaining coverage for individuals already enrolled.

That’s one way the California government could get out of this situation.

It’s easy to say “health care is a right,” but health care is a service. It has to be provided by skilled and trained people, using facilities and equipment that have to be rented or purchased, maintained and staffed. Somebody has to pay the utility bills, the payroll taxes and the insurance premiums, but Medi-Cal pays very low reimbursement rates.

If the math doesn’t work in the long term, doctors stop accepting Medi-Cal patients, hospitals close, and more than 14 million low-income Californians wait even longer for an appointment, if they ever receive care at all.

What about their rights? Who is in the streets protesting for them?

Write [email protected] and follow her on X @Susan_Shelley