With Federal Public Charge Rule Pending, California Braces For Possible Medi-Cal Exodus

Updated Nov. 27

A draft Trump administration rule that would penalize immigrants seeking green cards for accessing social services — including Medicaid — could cause thousands of kids to lose their health insurance, some advocates fear.

The proposal says people applying for legal permanent residency may be turned away if they’re deemed a “public charge,” meaning someone who’s become dependent on government assistance. There’s a laundry list of benefits that could be held against applicants, including housing assistance, food stamps and most Medicaid services.

The Department of Homeland security says the rule will “promote immigrant self-sufficiency” and “protect finite resources.”

California health advocates worry that legal citizens from mixed-status families who are entitled to Medi-Cal may drop their insurance for fear of negatively impacting their loved ones’ applications.

Kimberly Chen with the California Pan-Ethnic Health Network said even though undocumented children have been entitled to Medi-Cal since 2016, there’s confusion around what the proposed federal penalty means.

“Perhaps the kids are citizens and the parents are permanent residents,” she said. “Maybe they’re fearful that their use of Medi-Cal to get themselves healthy, that that would endanger their whole family's’ ability to become citizens in the future.”

Advocates are also worried the draft rule will keep some people from enrolling in Covered California this year, even though only Medicaid would be included in the proposal.

An analysis from the nonprofit Institute for Community Health shows that as many as 455,000 California kids with a "current or recent medical diagnosis, disability, or need for specific care" could leave their insurance plans for fear of endangering an undocumented family member. They got the number by tallying the 1.3 million children who fit those criteria, get care through the Medi-Cal program, and live with at least one non-citizen parent, then applying disenrollment rates of 15 to 35 percent.

If these patients drop their coverage but continue accessing medical care, hospitals worry they’ll have to foot the bill.

The California Hospital Association is bracing for an estimated $5 billion loss in federal reimbursements —  $2.9 billion for citizen patients who leave their plans for fear of endangering a non-citizen family member, and $2.2 billion for non-citizens. These estimates are based on 2016 enrollment and reimbursement rates.

The association is requesting that the federal Department of Health Services asking them to withdraw the proposed rule. Comments on the proposal end Dec. 10.

Clarification: This story was updated to reflect the group of children the Institute for Community Health analysis studied. The study looked only at children with a "current or recent medical diagnosis, disability, or need for specific care."