Implement a $100 Monthly Premium for Medi-Cal

This proposal suggests introducing a monthly premium of $100 for certain Medi-Cal recipients to generate revenue for the program’s long-term viability amid a projected $38 billion state budget shortfall for fiscal year 2026-27. It is part of the broader effort to balance the state budget while preserving the Medi-Cal expansion that extended coverage to all income-eligible adults regardless of immigration status, adding approximately 1.6 million new enrollees since 2024. The premium would apply to non-disabled adults between the ages of 19 and 64 with household incomes between 100 and 138 percent of the federal poverty level, a group that currently receives fully subsidized coverage. Proponents estimate the premium would generate approximately $800 million annually, based on the assumption that roughly 670,000 enrollees would fall within the applicable income range and remain enrolled after the premium takes effect. However, health policy researchers at the UC Berkeley Labor Center have cautioned that premium requirements in other states’ Medicaid programs have historically led to significant coverage losses, with disenrollment rates ranging from 12 to 25 percent among affected populations. The proposal includes hardship exemptions for individuals experiencing homelessness, those with chronic conditions requiring ongoing treatment, pregnant women, and former foster youth under age 26. Federal Medicaid rules impose limits on premiums for enrollees below 150 percent of the federal poverty level, meaning California would need to obtain a Section 1115 waiver from the Centers for Medicare and Medicaid Services to implement the proposal. The waiver application process typically takes 12 to 18 months and requires a public comment period, making implementation before mid-2027 unlikely even if the proposal advances legislatively. Healthcare advocacy organizations including Health Access California and the Western Center on Law and Poverty have opposed the proposal, arguing that even modest premiums create administrative barriers that disproportionately affect working-poor households with irregular income. Legislative supporters in the Assembly Budget Committee have framed the premium as a shared-responsibility measure that asks beneficiaries to contribute a fraction of their coverage costs, noting that $100 per month represents less than five percent of the average per-member monthly Medi-Cal cost of $2,200. Governor’s office representatives have indicated that the premium proposal is one of several options under consideration and that the administration prefers to explore provider rate adjustments and pharmacy rebate reforms before imposing costs on enrollees. If enacted, the Department of Health Care Services would be required to conduct a coverage impact analysis after the first year of implementation and report to the legislature on whether the premium has resulted in net revenue gains or net coverage losses.