House Republicans released a new Medicaid plan that would significantly cut federal funding for states that provide taxpayer-funded health coverage to illegal migrants.
Under the proposal, any state that offers Medicaid or similar state-funded healthcare programs to illegal migrants could lose billions in federal funds. Seven states — California, New York, Illinois, Oregon, Washington, Colorado and Minnesota — currently provide state healthcare benefits to non-citizens.
Federal law prohibits non-citizens from receiving Medicaid, but several blue states have created workaround programs that mirror the federal system. California was the first to launch a state healthcare plan for illegal migrants, offering full coverage through its Medi-Cal program to anyone under the age of 50 who meets income requirements, regardless of immigration status, the Los Angeles Times reported. The state spent more than $9.5 billion providing healthcare benefits to 1.5 million illegal migrants last year.
The House GOP’s plan would dramatically increase the cost burden on those states. Currently, the federal government covers 90% of the cost of Medicaid expansion, with states paying the remaining 10%. The Republican proposal would drop the federal share to 80% for states that continue covering non-citizens, forcing those states to cover 20% of the costs themselves, according to Axios.
California spent about $3.8 billion last year on Medicaid expansion alone, a $600 million increase from the previous year. With the proposed federal match cut, the total cost of providing health benefits to illegal migrants would exceed $12 billion annually — and those costs are projected to keep rising.
California is currently facing a budget shortfall of at least $10 billion and state analysts expect it to increase to $30 billion by 2028. Much of that funding shortage comes from the state’s Medicaid program.
Governor Gavin Newsom has already dipped heavily into California’s reserve fund to backfill the state’s Medi-Cal program — pulling $6 billion this year alone. The state’s reserves are now down to less than $20 billion, according to the California Budget and Policy Center.
Republican lawmakers in the state have repeatedly blasted Newsom’s spending priorities, arguing that illegal migrants are being placed ahead of American citizens.
“Democrats and the governor are picking priorities, and they’re prioritizing people that have come into our country illegally over people who immigrated here legally, people that are citizens,” Senate Minority Leader Brian Jones said earlier this year.
The House Energy and Commerce Committee is scheduled to hear the GOP’s Medicaid plan on Tuesday.
