Medicaid Cuts Would Undermine Medi-Cal’s Ability to Provide Affordable Care to Calif.’s Most Vulnerable People

Medicaid Cuts Would Undermine Medi-Cal’s Ability to Provide Affordable Care to Calif.’s Most Vulnerable People

This post is part 5 of our 12-part “Protect Medi-Cal Funding” series. Medi-Cal provides a long-term investment that helps Californians succeed. This blog series highlights the importance of Medi-Cal affordability protections.

California’s Medicaid program, Medi-Cal, makes health coverage affordable for low-income people in the state. Most enrollees pay no premiums or deductibles, and copays for most services are no more than one dollar.

The American Health Care Act (AHCA) passed by House Republicans cuts federal Medicaid spending by $834 billion over ten years and caps Medicaid funds to states. In addition, the recently released White House budget proposes to further cut federal Medicaid spending by an estimated $1.3 trillion over the next decade. These Medicaid funding cuts will shift costs to the state, and invariably lead to California.

Faced with these cuts, the state may seek to:

  • Impose premiums on some low-income individuals and families in Medi-Cal, forcing them to choose between coverage and other life necessities;
  • Enact higher out-of-pocket cost-sharing to restrict or delay access to Medi-Cal services.
  • Allow providers to turn Medi-Cal beneficiaries away from needed care if they cannot afford to pay an out-of-pocket charge.

Placing such financial burdens on populations who can least afford them will harm these Californians by forcing them to delay or forgo care at risk to their own health. Raising out-of-pocket costs is pennywise and pound foolish, since the state will save little money in the short term when Medi-Cal enrollees forgo or delay their care, and will end up paying much more when those enrollees need more expensive care or emergency treatment in the future. Making Medi-Cal unaffordable will also lead to more Californians becoming uninsured and further strain the financial viability of health care safety-net systems and hospitals.

See our Protect Medi-Cal Series, Issue Brief #5, for a “deeper dive” on the importance of Medi-Cal affordability protections, and how they are threatened by Medicaid funding cuts.

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