Gavin Newsom’s New Budget Proposal Expands Health Care to the Undocumented

It’s a huge step toward universal health care coverage.

In April of last year, the UC Berkeley Labor Center and UCLA’s Center for Health Policy Research released a report estimating that 3.2 million Californians would remain without health coverage in 2022. Separate research from the Public Policy Institute of California found that nearly half that number were immigrants, and of those a significant number were undocumented. Indeed, the Labor Center’s findings suggest that 1.27 million undocumented immigrants in California lack health coverage.

Three million is a big number, but it’s far fewer than were uninsured in the recent past—and it’s a number that is likely to shrink significantly over the coming years if Governor Newsom’s just-released budget plan for 2022–23 comes to fruition and the state expands MediCal coverage to include undocumented adults of all age groups.

Newsom’s proposal, which has been something of a holy grail for health care reformers and immigrant rights advocates in the state for years, is the latest in a long line of reforms that California has embraced over the past decade, as its political leaders have moved assertively to plug as many gaps in its health care umbrella as possible. The result has been that the proportion of the uninsured in the state has gone from more than 20 percent of its population, or 7 million people under the age of 65,  a decade ago—putting it in competition with states like Texas for the highest percentage of its population lacking coverage—to slightly more than 8 percent today.

In the wake of passage of the Affordable Care Act, the state created its Covered California insurance exchange, and then pumped millions of dollars into PR campaigns designed to get the word out to low-income and minority communities that health care was now affordable and within reach for millions of previously uninsured individuals and families. In 2016, the state picked up the tab to expand MediCal to undocumented children under the age of 18—a reform that the feds wouldn’t pay for. In 2019, legislators raised the age limit to include undocumented residents under the age of 26. The reform kicked in in 2020, just before the pandemic took root. Last summer, Newsom signed a bill that made low-income Californians 50 years old and above eligible for MediCal; overnight, some 235,000 undocumented residents in that age bracket qualified for health care.

Now, with California in the luxurious position of having a budget surplus of many tens of billions of dollars, Newsom is proposing expanding MediCal, beginning in 2024, to cover low-income undocumented immigrants of all ages, as well as hundreds of thousands of other low-income residents, under the age of 65, throughout the state. True, it’s not quite the system of single-payer universal health care envisioned by supporters of Assemblyman Ash Kalra’s AB 1,400, a massive $400 billion proposal that is currently being discussed in assembly committees; but it is a huge step toward universal health care coverage. And given the sticker shock associated with converting a fragmented private health care delivery system into a single-payer system, Newsom’s plan, one of many ambitious proposals contained within his $286 billion budget, is almost certainly more likely to survive battles in the legislature and to command more public support over the coming year than is the single-payer proposal. If it does survive, and if he wins reelection, he will then have four years to seal the deal and effectively move the state toward universal coverage, albeit of a patchwork-quilt kind rather than a single-payer system.

If Newsom’s proposal to make MediCal available to undocumented Californians, regardless of their age, is approved by state legislators, it will cost the state $2.2 billion per year. That’s a lot of money, but given the huge multiyear surplus California is now sitting on—the Legal Analyst’s Office has estimated that it is well north of $30 billion this year; other estimates put the surplus closer to $45 billion—it’s eminently doable.

Across the board, Newsom’s budget proposal thinks big. It expands the state’s child tax credit, pours money into both K-12 schools and higher education institutions, and allocates additional billions of dollars to tackle homelessness. It channels billions more dollars into fighting climate change and protecting the state from the scourge of wildfires, expands state efforts to mitigate the impact of rolling droughts, and allocates billions of dollars to the state’s ongoing efforts to build a high-speed rail network. In the medical arena, it bulks up investments in maternity health care, in mental health diagnostics and services, and in protecting reproductive services during an era in which Roe v. Wade is under mortal threat. It increases state subsidies for the 1.5 million people who purchase their insurance through Covered California. It also seeks funding to reduce MediCal premiums for children, for disabled workers, and for pregnant women, while simultaneously investing hundreds of millions of dollars to train and employ a network of community health workers around the state. And it throws the full weight of California’s purchasing power behind an effort to lower drug prescription costs, particularly those associated with insulin.

Taken as a whole, Newsom’s 2022–23 budget proposal will further reshape California’s economy and its politics. Ten years ago, one in five Californians had no access to health care—a percentage that today still holds in Texas, Mississippi, and many other parts of the Deep South, in particular; now that number is far less than one in 10, and about to get much lower still. Twenty-five years ago, California embraced some of the country’s toughest laws against undocumented immigrants—laws and practices that would be all too familiar today to denizens of Arizona or Texas. Now, by contrast, it is on the cusp of making all of its undocumented residents eligible for some form of health care coverage.

There is a lesson here: that the long game is worth playing. More than a quarter of a century ago, immigrants’-rights groups came together in California to build coalitions against then-Governor Pete Wilson’s demagogic politics. At the time, it would have seemed inconceivable that a future governor would embrace the notion of providing state-subsidized health care to undocumented immigrants. Today, by contrast, such a policy shift is simply deemed  common sense.

Texas today, under Governor Abbott, is, when it comes to health care and immigrants’ rights, about where California was in the mid-1990s. Who knows, maybe by mid-century the Lone Star State, too, will have worked out ways to provide health care to the vast majority of its uninsured population, and will have learned how to treat its undocumented immigrant population with dignity and respect rather than with contempt and cruelty.

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