California's Medi-Cal Faces $3.5 Billion Gap, Borrowing Needed, Immigrant Coverage Scrutinized

California Faces Budget Gap in Medi-Cal Program

California is facing a budget gap in its Medi-Cal program, the state's version of Medicaid, and will be forced to borrow almost $3.5 billion to cover the shortfall. This information was revealed in a letter sent by Governor Gavin Newsom's administration and obtained by Politico.

The borrowed funds would only be enough to pay Medi-Cal bills until the end of the month, according to state Department of Finance spokesperson HD Palmer. This situation is likely to increase scrutiny on the state's policy of providing health insurance to undocumented immigrants, which has proven more expensive than initially anticipated.

Newsom's current budget proposal estimates the state will spend $8.4 billion on providing Medi-Cal coverage to undocumented immigrants in the 2024/25 financial year and then $7.4 billion in 2025/26.

Assembly Speaker Robert Rivas has expressed his support for the policy, stating that "We will not roll over and leave our immigrants behind." However, Senate Minority Leader Brian Jones and Assemblymember Carl DeMaio have criticized the policy's cost, with Jones accusing Newsom's administration of being "secretive" about the rising costs.

Newsom's spokesperson, Izzy Gardon, responded that "Rising Medicaid costs are a national challenge, affecting both red and blue states alike.