Newsom signs law as Californians brace for loss of healthcare coverage

Gov. Gavin Newsom signed a law this week in response to the Trump administration’s gutting of Medicaid last year that will likely help millions of primarily low-income Californians, who will soon need to prove that they work in order to keep their healthcare coverage.

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The law comes a year after President Donald Trump signed the One Big Beautiful Bill last summer, which is projected to cut an estimated $911 billion from federal Medicaid spending over the next decade and add work requirements for the program. Medicaid primarily provides healthcare for low-income people and people with disabilities, and in California’s program, called Medi-Cal. The new work requirements were criticized by Democrats and patient advocacy groups, who warned that putting more paperwork on already vulnerable populations will leave more Americans uninsured. 

Starting this January, patients ages 19 to 64 who do not have dependent children must prove they are working 80 hours a month in order to receive coverage, and enrollees will be required to submit proof of work every six months. The Department of Health Care Services projects that by next June, almost a quarter of million Californians will lose Medi-Cal coverage and another 1.4 million by the following year as a result of the work requirements.

The Trump administration said they are designed to encourage enrollees to get off Medicaid and find a job that can pay for their insurance. 

But Democrat Assemblymember Mia Bonta, who chairs the Assembly Health Committee, argued that people will lose healthcare because of paperwork, not because they aren’t working. Her proposed bill, which Newsom signed this week, does not change the federal work requirements, but it requires state and local agencies to prioritize maintaining Medi-Cal coverage for enrollees. The measure includes new notifications to people before they are dropped from coverage and requires counties to check available data before asking beneficiaries for paperwork. The bill is projected to cost as much as $1.3 billion over the next four fiscal years, .

She called her law a “modest” change but said that it will help limit the application of what she said are “onerous” rules.

“Let’s be clear, work requirements are not about work. They’re about paperwork,” she said in April during an early hearing for the bill. “They’re about throwing a hurdle that results in people losing coverage, even when they are working, eligible and trying to comply.”

The final version of the bill was opposed by 11 Assembly Republicans and nine Senate Republicans in its final voting tally this August.

Under the guidelines set by the Centers for Medicare & Medicaid Services, some enrollees are exempted, including pregnant women, parents, veterans with disabilities, those in active drug treatment programs and former foster youth. But the agency in June released even stricter guidelines that redefined the rules so that disabled or sick patients undergoing cancer treatment still have to prove that they’re working. California and 24 other states along with the District of Columbia the Trump administration, alleging that the agency is overstepping with those restrictive requirements.

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Bonta emphasized that there are a lot of moving parts to the new federal rules, and she hopes her bill will make the federal law a little easier to navigate.

“There’s a lot going on here,” Bonta said during that hearing before the Senate Standing Committee on Health when discussing the need for her bill.

A 2022 report from the Congressional Budget Office said that requirements can slightly increase employment rates or average earnings, but they delay access to care because they create additional barriers. 

Linda Wei, a representative from Western Center on Law and Poverty, a co-sponsor of Bonta’s bill, testified in July that previous work requirements implemented in Arkansas and Georgia have led to a decrease in health coverage with no positive change in employment outcomes. 

The Arkansas program lasted nine months starting in 2018 and heading into 2019 and only applied to adults ages 30 to 49. It put around 18,000 adults out of coverage.

Recipients who can work are already working, Wei said, citing 63% of “nondisabled, non-elderly adults.” She also noted that another 14% are not working are due to being caretakers for a family member, while 8% are students.

Newsom recently required immigrants without legal status on Medi-Cal, who were not immediately affected by Trump’s work rules, to also prove they are working to receive benefits. Bonta said that will put even more Californians at risk of losing coverage.