Local health providers are bracing for Medicaid cuts under the new federal spending law. They say the cuts will impact their ability to care for low-income patients, potentially leading to financial strain.
At Raíces y Cariño, a community center in Watsonville, 39-year-old Cordelia (last name withheld to protect her privacy) watches her sons bounce on trampolines in the play room.
She often brings the kids in after finishing her shift picking blackberries at a nearby farm.
“By bringing them here, I’m also saving money and food at home, and that helps a lot,” she said in her native Mixteco. “And, the kids can come and distract themselves and have fun for a while.”
Raíces y Cariño provides support for low-income families, especially farmworkers like Cordelia, by offering family recreational activities and community health services including doula support.
Families donate what they can – up to $5 monthly, and the rest is covered by Medicaid, called Medi-Cal in California, which provides health insurance to millions of low-income people.
Raíces y Cariño founder Nora Yerena is worried the cuts to Medi-Cal could mean they struggle to provide services for families like Cordelia’s.
“It is a very serious risk that I'm aware of and fear that if we can't have sustained funding for what we're doing, it won't exist,” Yerena said.
The changes in H.R.1, signed by President Donald Trump in July, slash federal Medicaid funding by about $1 trillion over the next 10 years. The new law includes work requirements for adults and those who fail to meet them will not qualify for insurance.
According to an analysis by health non-profit KFF, an estimated 1.7 million people in California will become uninsured by 2034, once the changes take effect.
And when this happens, thousands in Central California could lose their individual healthcare coverage. That creates a lot of uncertainty.
California had adopted “Medicaid expansion,” wherein the federal government pays for 90% of coverage for those enrolled. On top of the federal cuts, California’s budget also changes Medi-Cal access for immigrants without legal status. This includes a freeze in enrollment of new recipients.
“They're trying to mitigate some of their own costs in the health care programs through this freeze, or through imposing premiums on certain populations. That's sort of a one-two hit for people in California,” said Kim Lewis, the Managing Director of the National Health Law Program's California office.
The California Hospital Association estimates that hospitals will lose up to $128 billion over the next decade as a result of federal cuts. Hospitals are caught in the quandary of providing care to everyone and losing money.
At Watsonville Community Hospital, 85% of the patients have government sponsored insurance and the hospital gets about half of its patient income from Medi-Cal. Many patients are agricultural workers and 13% speak Mixteco.
In a consultation room, Dr. Katie Gabriel-Cox is checking the heartbeat of a patient's baby in the OBGYN unit, which welcomes 800 births a year.
She fears the Medi-Cal cuts will have devastating consequences for her patients. In the past, the hospital has been able to secure Medi-Cal coverage during pregnancy. But a parent's medical needs don't disappear after a baby is born.
“That is where I worry that we will see even greater impacts, is in that really critical time when the baby is still a newborn and the parent loses (Medi-Cal) coverage,” Gabriel-Cox said.
And she highlights other concerns too, like immigration enforcement, which has increased under the current administration and is making some patients hesitate to seek help.
“I have had patients decline visits with specialists or specialty care that is further from home because of fear of immigration and feeling afraid," Gabriel-Cox said. "We’re certainly already seeing those impacts. ”
Those delays can add another layer of risk. As Central Valley Health Policy Institute’s executive director Tania Pacheco points out, that’s another potential burden for already cash-strapped hospitals. Fewer patients on Medi-Cal mean less revenue for hospitals.
“We have such a high immigrant population that we will see that care is about to get costlier because folks are not going to be accessing care in time or doing the preventative things that we know work,” Pacheco said.
In Monterey County, Salinas Valley Health’s medical center admits over 10,000 patients per year, about 30% of them are on Medi-Cal. The hospital is anticipating that a large number of these patients will lose their insurance entirely.
Salinas Valley CEO Allen Radner said although they’re not feeling the impact yet, Medi-Cal cuts will inevitably cause financial pressure, putting a strain on the hospital's ability to care for low-income patients.
“In California, we're talking about billions of dollars that are coming out that we are unequivocally going to have challenges providing services at the level we've provided,” Radner said.
Dr. Orlando Rodriguez, who runs Salinas Valley's Mobile Clinic, agrees. "It's really like a double-edged sword for us because for our healthcare system, we're seeing a decrease in revenues. But we also know that we're going to see a marked increase in the number of patients coming (to the mobile clinic.)"
Medi-Cal changes won’t kick in till next year. That's when patients and providers will know the full impact.
“I'm hopeful that as things change and if they get more challenging, we can work together as a community to try to make sure that everybody here gets the care they need,” Radner said.
