Gov. Newsom criticized for Medicaid benefit elimination proposal for disabled immigrants

California Gov. Gavin Newsom vowed he would not fix the state's budget deficit by taking away health insurance from low-income adults living in the country without legal permission, calling the state's policy “something I believe in.”

But Newsom would eliminate an important health benefit for some low-income immigrants with disabilities, angering his allies who are now accusing the second-term governor of breaking his word.

California was one of the first states to give free health insurance to all low-income adults regardless of their immigration status. The multibillion-dollar project, completed in January, made more than 1 million people eligible for California's Medicaid program, including many people who had never before had health insurance.

Now, just five months later and with California facing an estimated $45 billion deficit, Newsom wants the state to stop paying for caregivers to come to the homes of some disabled people — who are living in the country without legal permission — to help them with cooking, cleaning and other tasks so they can stay out of nursing homes. Everyone else would keep that benefit.

The Newsom administration says this would save about $94 million and impact fewer than 3,000 people out of the more than 15 million who are enrolled in the state's Medicaid program, known as Medi-Cal. But eliminating the benefit would also keep thousands more from becoming eligible in the future.

Newom's proposal “is a betrayal,” said David Kane, an attorney with the Western Center on Law and Poverty. Ronald Coleman Baeza, managing policy director for California Pan-Ethnic Health Network, called it “indefensible” and compared the proposal to a notorious ballot proposition from the 1990s that sought to bar immigrants from accessing government assistance programs.

“I think it could move us back in the sense of treating undocumented as different,” said state Sen. Maria Elena Durazo, a Democrat from Los Angeles who has pushed for the Medicaid expansion for years.

Newsom’s proposal for immigrants would impact a benefit known as in-home supportive services that’s becoming more expensive for the state to provide. The average hourly wage for caregivers has gone up 6% since 2014. And starting this year, with some emergency federal funding provided during the pandemic expired, there have been cost increases of about $200 million.

Once people qualify for the program, they get to hire their own caregiver. It’s often a relative, meaning the program often acts as financial assistance for families.

Marvin Estela Pineda, a 42-year-old woman originally from El Salvador who now lives in California’s Central Valley, lost her eyesight at 30 because of glaucoma. She started getting in-home supportive services earlier this year.

Her daughter, Mayde Pineda, said the government has been paying her $16.50 per hour for a total of 84 hours a month to care for her mother, which includes things like cooking, cleaning and laundry. Mayde Pineda, 22, said the money helped stabilize the family financially while she finished college.

“Without (this program) I won’t be able to care for her without significant hardships,” Mayde Pineda said.

The California Department of Social Services, which administers the program, said it would work “to mitigate any negative impact to currently assisted individuals,” which includes helping them find other government-funded programs that could provide similar services. One option would be Medi-Cal's community-based adult services program, which pays for things like personal care, food and professional nursing services.

Asked for comment on his proposal, the governor’s office pointed to remarks Newsom made earlier this month when he announced his budget plan that included an array of painful cuts.

“We don’t find any joy in this — but we’ve got to do it, we have to be responsible. We have to be accountable. We have to balance the budget,” Newsom said.

Newsom for much of his tenure has basked in the praises of progressives as he used a string of historic surpluses to expand government services. But back-to-back multibillion-dollar deficits are forcing Newsom to make some hard choices that have put him on a collision course with some of his most vocal supporters.

Navigating these conflicts will be critical for Newsom, who has been building his national profile ahead of a potential presidential campaign. So far, Newsom has been moving quickly to address them. When the state's largest teachers union ran ads criticizing him for his proposed cuts to education, Newsom struck a deal with them that resolved much of their concerns. That deal still must be approved by the state Legislature.

Other negotiations will be more difficult. Newsom’s health care proposal for immigrants is just one of many proposed cuts across the state’s wide array of social services programs.

The state Legislature, which is controlled by Democrats, plans to pass their own version of the budget by June 15 that would restore nearly all of those cuts, including the health care cuts for some immigrants. Their plan does this by increasing a temporary tax hike on businesses while also slashing about $1 billion from the state's prison budget.

“We have ensured that the budget is not balanced on our most vulnerable populations,” said Assemblymember Corey Jackson, a Democrat from Moreno Valley.

Newsom and legislative leaders will negotiate over the next few weeks on a final spending plan, with the goal of passing a budget around the start of the new fiscal year on July 1. While the Legislature votes on the budget, Newsom has a lot of influence. He decides whether to sign the budget into law. California lawmakers have rarely ever overturned a governor's veto.