California Governor Gavin Newsom (D) has approved a $2.8 billion bailout to address a growing deficit in the state's Medicaid program, largely due to the expansion of coverage to illegal immigrants, Fox News reports. The bailout, verified by Newsom's office, follows a request to state legislators for a $3.4 billion advance from the general fund to manage approximately $6.2 billion in unpaid expenses related to Medi-Cal. These funds will sustain the program until June for around 15 million California residents, including those without legal status.
Republican leaders have criticized the loan, arguing that the current Medicaid structure is unsustainable with the inclusion of illegal immigrants. State Senate Minority Leader Brian Jones stated that access to healthcare is deteriorating and that legal residents are being given a lower priority. He called for halting new enrollments for illegal immigrants to control the program.
"Meanwhile, healthcare access is plummeting. Wait times are growing. Democrats have made their choice: legal residents come second," Jones wrote on X, adding "We must stop new enrollments of illegal immigrants and rein in this unsustainable program before it collapses entirely.”
Republicans have argued that the current Medicaid program cannot be sustained if illegal immigrants continue to be included in the coverage, according to Fox News.
"That’s a staggering $6.2 billion over budget...and the costs keep climbing with no end in sight," California Senate Republican Minority Leader, Brian Jones, wrote in a post on X on Monday. "Californians should not be forced to shoulder the burden of radical Democrats' reckless financial mismanagement.”
State statistics show that approximately 1.6 million illegal immigrants are receiving Medi-Cal benefits, part of the overall 15 million beneficiaries. Initial projections estimated the expansion would cost just under $6 billion for the fiscal year 2024–2025, but recent estimates now project the cost at $8.4 billion for 2024–2025, followed by $7.4 billion the following year.
In response, state House Republicans are proposing to cut $880 billion, mainly from Medicaid, over the next decade to curb what they argue is irresponsible government spending.