LOS ANGELES — The National Health Law Program (NHeLP) warned today that proposed health care cuts included in Gov. Gavin Newsom’s 2026-27 May Revision budget proposal would jeopardize access to care for millions of Californians already struggling with rising costs and economic uncertainty.
The May Revision comes as California faces rising health care costs, growing affordability challenges, and mounting pressure from federal Medicaid cuts and other threats to the health care safety net under H.R. 1 or the so-called “One Big Beautiful Bill” Act. These federal policies are forcing the state to make difficult decisions that will directly impact the communities who rely on these programs for care and stability.
“While we’re glad to see in this budget a proposal to seek federal authority extend the managed care organization (MCO) Tax to increase revenue and hopefully cushion some of the most drastic losses caused by federal Medicaid cuts, this budget still harms low-income Californians, particularly people with disabilities, older adults and immigrants,” said Kim Lewis, Managing Director of California Advocacy at NHeLP.
The budget proposes to reimpose a $2,000 Medi-Cal assets test which will result in tens of thousands of older adults and people with disabilities losing their Medi-Cal coverage, as well as continuing the proposed January cuts to the In-Home Supportive Services (IHSS) program by shifting the costs of IHSS to counties and eliminating the back-up provider system, resulting in a loss of access to critical home and community based services for these same populations. The May Revise budget further proposes to push some immigrant communities who are losing federal Medicaid under H.R. 1 into emergency-only coverage instead of comprehensive care, as well as increasing premiums to $50 for immigrants who have access to state-only funded Medi-Cal coverage. Finally, the Governor continues to propose eliminating a statewide mandate to provide mobile crisis services under Medi-Cal, which means more people who experience a behavioral health crisis will be unnecessarily hospitalized or be harmed if they cannot get that appropriate community based treatment.
“These proposed cuts to Medi-Cal coverage and services will simply add to the growing number of uninsured Californians who are already struggling to make ends meet and cannot afford to make the untenable decision to either incur medical debt or forgo health care altogether until they are forced to get emergency services. Those who can get Medi-Cal will go without some of the critical home and community based services they need.”
