Update on the State Budget

Following up on from our message about the May State budget revision, I wanted to give you a brief update on where things stand now.

Since May, the Legislature and Gov. Newsom have continued negotiating and the State passed its 2025-26 budget, which will take effect July 1. While this latest version of the budget reflects several compromises negotiated by lawmakers, it will still have a concerning impact on our community, especially adult undocumented immigrants. Here are a few of the health-related line items:

• The State will re-establish asset tests to determine Medi-Cal eligibility. Individuals with $130,000 in assets and couples with $195,000 in assets won’t be eligible for Medi-Cal anymore.
• Starting Jan. 1, 2026, the state will freeze enrollment in Medi-Cal for adults with undocumented immigration status (although those who already have Medi-Cal will be grandfathered in).
• Undocumented adults still on Medi-Cal will have to pay a monthly $30 premium to retain their benefits (down from $100 in the Governor’s May proposal) after Jan. 1, 2027.
• Dental benefits for undocumented adults on Medi-Cal are being eliminated after July 1, 2026.
• The State will also end enhanced reimbursement rates for undocumented adult visits at our Federally Qualified Health Centers starting July 1, 2026. As I mentioned before, this means we would receive much less funding for the same care.

There are roughly 50,000 adults on Medi-Cal with unsatisfactory immigration status in Contra Costa who are patients at CCRMC & Health Centers. It will be critical to get the uncovered portion of this population enrolled in Medi-Cal before the January 1 cutoff date.

I am worried that as a result of the changing Medi-Cal rules we will see more people delaying care and ending up in our emergency room – or worse -- when their conditions become critical.

It’s still to be determined exactly how all these changes will affect our operations. Obviously, some parts of the department (such as the Health Plan and our delivery systems that are funded largely by Medi-Cal) will be more impacted than others (regulatory programs like Environmental Health that rely on local fees). Meanwhile, the federal budget is still being negotiated and we don’t yet know how that will further change our outlook.

As things become clearer, department leadership will remain in contact with you all and share the latest information. Whatever happens, just remember -- our mission will remain the same and we will proudly continue to be the safety-net provider for our community.