Gov. Gavin Newsom called on Wednesday for California to reduce health care coverage for undocumented immigrants to help balance the state budget, stepping back from his goal of “universal health care for all.”
This decision comes two days after the Trump administration targeted another state-funded program for immigrants in California and warned it would continue to scrutinize benefits for undocumented people.
In his budget presentation, Newsom proposed freezing enrollment of undocumented adults in California’s Medicaid program, Medi-Cal, beginning in January. He also plans to introduce a $100 monthly fee for those who stay in the program starting in 2027. Together, these changes could save the state $5.4 billion by the 2028-29 fiscal year.
The Trump administration has used federal authority to pressure Democratic-led states to cut benefits for undocumented immigrants. Homeland Security Secretary Kristi Noem recently said, “If you are an illegal immigrant, you should leave now. The gravy train is over,” while targeting a California cash aid program.
However, Newsom described the proposed cuts as a fiscal necessity rather than a shift in philosophy.
California faces a $12 billion deficit within a proposed $321.9 billion budget, Newsom explained, due to rising spending amid economic and financial market volatility. The deficit could grow if the federal government reduces funding to states, a possibility currently under Congressional review.
Newsom, a Democrat, partly attributed the budget shortfall to a drop in tax revenue caused by President Trump’s trade wars, calling the economic impact a “Trump Slump.”
For months, it has been evident that California’s Medi-Cal program has overspent by billions, raising doubts about the state’s ability to sustain its progressive health care goals.
Providing health care to undocumented immigrants has proven much more expensive than California officials expected after expanding Medi-Cal last year to cover all low-income residents regardless of immigration status. The state funds these benefits entirely on its own.
