California borrows $3.44 billion to Cover Healthcare for Undocumented Immigrants

California’s state-funded health insurance program, Medi-Cal, is facing financial difficulties as the state has loaned $3.44 billion from the general fund to cover expenses for the “white card” benefits, which include coverage for individuals with disabilities, low-income populations, and undocumented immigrants.

Chief Deputy Director of the California Department of Finance, Erika Li, disclosed in a letter to the legislature on March 12 that the department had approved a temporary fund loan of $3.44 billion on March 4 to address the funding shortfall for the state’s Medi-Cal program. Li was appointed to this position by Governor Newsom in November 2020.

Li emphasized that this funding has been approved to fulfill Medi-Cal expenses exceeding what was approved in the state budget for the year 2024, allowing the California Health and Human Services Agency to use this loan to make payments to healthcare providers.

With this significant loan reaching its limit, some state legislators criticized its inclusion of medical expenses for undocumented immigrants. Republican Senate Leader Brian Jones voiced his concerns on social media, stating that it was a “typical secret move by the Newsom administration to quietly issue a destructive notice about using $3.44 billion in loans to fund free healthcare for illegal immigrants.”

Jones further noted that senators would request comprehensive hearings and cost analyses to ensure transparency on where taxpayer money is being allocated.

According to the non-partisan Center on Budget and Policy Priorities, 35 states nationwide currently offer free or low-cost medical services to residents, regardless of their immigration status or insurance coverage.

A spokesperson for Governor Newsom mentioned in an email to Epoch Times that the need for additional funding to support Medi-Cal was outlined in the budget proposal back in January, attributing rising healthcare costs as a nationwide challenge affecting both red and blue states, not exclusive to California.

Ira Mehlman, spokesperson for the Federation for American Immigration Reform (FAIR), stated to Epoch Times that this demonstrates the high cost California and some states bear to accommodate illegal immigrants, potentially leading to unmet needs in other areas within these jurisdictions.

FAIR’s research indicates that California is home to approximately 4.1 million undocumented immigrants and their U.S.-born children, accounting for about 10.7% of the state’s total population. Mehlman highlighted that free healthcare acts as a magnet attracting illegal entry into California, adding to the burden on the state’s dwindling tax revenues.

Republican Assemblyman Bill Essayli echoed similar sentiments on social media, warning that California would go bankrupt by providing free healthcare services to undocumented immigrants, criticizing the lack of restrictions on the number of individuals who could avail themselves of such services.

In recent years, California has incrementally expanded healthcare coverage for undocumented immigrants. Starting in 2016, comprehensive white card benefits were extended to individuals under 19 years old, followed by an expansion to young adults aged 19 to 25 in January 2020. By July 2021, around 286,000 undocumented individuals over 50 years old were granted full white card benefits. By January 2024, California completed the expansion of medical assistance for undocumented immigrants, offering comprehensive healthcare to approximately 760,000 adults aged 26 to 49. Newsom hailed this expansion as a historic step towards universal healthcare coverage, positioning California as the first state to achieve full coverage.

A recent report by CalMatters revealed that California government spending on expanding coverage for undocumented immigrants under the Medi-Cal program exceeded initial projections by $2.7 billion, with around 1.6 million undocumented immigrants enrolling in the white card program.

During a recent state budget hearing, it was disclosed that California’s expansion of the Medi-Cal program for undocumented immigrants is expected to cost around $8.5 billion annually from the state’s general fund. Meanwhile, with California facing financial deficits in the past couple of years, certain programs serving legal immigrants have seen reductions.

(Note: This article is a summary and adaptation of a news source focusing on the financial challenges of California’s state health insurance program, Medi-Cal, amidst criticisms and concerns regarding the funding allocation for undocumented immigrants.)