What we shared with the Board of Supervisors today

Dear Contra Costa Health team,

Today we presented to the Board of Supervisors about major state and federal policy changes affecting Medi-Cal and public hospital funding, and how Contra Costa Health is preparing. I’m sharing the presentation slides so that you have the same information we shared with the Board.

At a very high level, the presentation covered:

• Significant numbers of residents are expected to lose Medi-Cal coverage as new federal and state rules take effect
• CCH is projecting a structural deficit exceeding $100 million by fiscal year 2028-29, driven by reduced Medi-Cal enrollment and cuts to safety-net spending
• These impacts compound year over year and are affecting public health systems across California and the nation
• The Board has asked staff to return with a proposal to update and strengthen the county’s healthcare supports for residents who have no coverage
• CCH is preparing now through planning, coordination with county partners, and performance improvement work

Four things matter most for staff to understand, especially looking ahead.

1. This is a structural challenge that requires disciplined stewardship.
   Federal and state policy changes will reduce Medi-Cal enrollment and significantly reduce funding for safety-net health systems like ours. These are external decisions, not the result of performance, effort, or commitment by CCH staff. At the same time, how we manage our resources matters. We have a responsibility to prioritize, to make every dollar count, and to be disciplined about where we invest limited resources. That means continuing to look for efficiencies, reduce avoidable costs, and coordinating closely with county partners.
   
   What to expect next: We will continue prioritization and planning work across CCH, informed by countywide collaboration and data. As state guidance becomes clearer, we will refine assumptions, adjust plans and share updates with staff as decisions move forward.
2. The impact is not confined to one department or system.
   These changes affect the entire safety net, including Contra Costa Health, the Employment & Human Services Department (EHSD), and other county departments that serve overlapping populations. Internally, reduced Medi-Cal enrollment and funding create pressure across health care, behavioral health, public health, social services, and the administrative infrastructure that supports them. Every public hospital and county in California is confronting the same challenge.
   
   What to expect next: Preparation and response will require coordination across departments, shared data, and a shared, consistent understanding of the facts across CCH and the broader county. There is no single department or single solution that can absorb changes of this scale on its own.
   
   
3. We are preparing, not panicking.
   We are taking a disciplined, proactive approach to managing constrained resources. That includes internal performance improvement work across multiple areas – workforce, pharmacy, revenue cycle, service optimization, supply chain, facilities, and technology – with a goal of reducing cost and improving efficiency while protecting access to care. At the same time, we will continue strengthening the infrastructure needed to operate a strong public health system, through key leadership roles, system improvements, and continued investment in facilities like the Regional Medical Center campus, so we are better positioned to meet the challenges ahead.
   
   What to expect next: This work will continue through 2026 and inform internal planning and decision-making across CCH. The purpose is to ensure that choices we do make are deliberate, informed and aligned with our mission.
4. Our commitment to equity remains central.
   As coverage changes and pressures increase, working closely with community partners and engaging the communities we serve will be more important than ever. CCH exists to ensure that essential services remain available to people who are most vulnerable, and that commitment does not change during difficult fiscal periods.
   
   What to expect next: We will work closely with community partners and county departments to understand impacts, identify gaps, and inform program design. Equity will continue to guide these discussions so that decisions reflect the needs of the communities we serve.

In the coming months, the state and federal governments will issue guidance and make implementation decisions. As that happens, we will refine our projections and return to the Board with updates. This will be an evolving picture, not a single announcement.

I know this is difficult information to absorb, and that uncertainty can be unsettling. I commit to continuing to communicate frequently, returning to the Board as plans evolve, and keeping staff informed as decisions are made.

Thank you for the work you do every day to care for our community, especially during these challenging times.

Sincerely,

Grant Colfax, MD
Chief Executive Officer
Contra Costa Health