Millions of Californians at Risk of Losing Health Coverage Amid Federal Cuts

Millions of Californians could lose their health insurance as federal budget changes threaten to slash funding for Medi-Cal, the state’s Medicaid program. State officials warn that the cuts will have a devastating impact on low-income families, children, and seniors who rely on affordable healthcare.

A recent report from the Legislative Analyst’s Office (LAO) revealed that California is facing a $17 billion budget deficit, leaving the state unable to fully compensate for the loss of federal support. The new federal legislation, known as H.R. 1, redirects billions of dollars away from Medicaid and toward tax breaks and border security projects. As a result, analysts estimate that between 1.2 million and 3 million residents could lose their Medi-Cal coverage.

Healthcare leaders say the effects will ripple through the entire system, from hospitals and clinics to emergency rooms and local health programs. “This will touch every corner of our healthcare system,” one official noted, emphasizing that both public and private providers will feel the strain.

The new federal law introduces strict eligibility rules that could make it harder for many Californians to keep their coverage. Starting in 2027, adults between 19 and 64 may need to work at least 80 hours a month, attend school, or complete community service to qualify. In addition, the law removes federal funding from providers that offer abortion services, reduces funding for emergency care for undocumented individuals, and limits how states raise money to support Medicaid.

Governor Gavin Newsom has pledged to do what he can to lessen the impact by increasing state support for healthcare providers and directing more resources to community programs. California Attorney General Rob Bonta has also filed multiple lawsuits challenging the federal changes, arguing that they unfairly harm low-income families and overburden the state. Despite these efforts, officials admit the financial shortfall is too large to completely cover.

Medi-Cal currently provides healthcare to about 15 million Californians, including more than half of the state’s children. In Los Angeles County alone, local officials project an annual loss of $750 million, which could jeopardize the operation of public hospitals and community clinics that serve vulnerable populations.

“This isn’t just about numbers,” one county health director said. “It’s about families who might lose access to doctors, medications, and preventive care.”

As California braces for these sweeping changes, state leaders and advocates are urging Congress to reconsider the funding cuts. They warn that the long-term consequences—for public health, economic stability, and community well-being—could be far more costly than any short-term savings. The coming months will determine how the state manages one of the most serious healthcare challenges it has faced in years, and how millions of residents may be forced to adapt to a new and uncertain healthcare landscape.