This month marks the tenth anniversary of Medi-Cal expansion under the federal Affordable Care Act (ACA). California’s embrace of the ACA has transformed the state’s health coverage landscape: over the past decade, uninsured rates have plummeted to historic lows and millions more people have gained health coverage. Most of these gains have been driven by Medi-Cal expansion.
Medi-Cal enrollment increased by more than 7 million between 2013—when the state launched some pre-ACA initiatives (e.g., county-level low-income health programs)—and April 2023, when enrollment peaked. By far the largest increase (214%) was among adults under age 65, many of whom became newly eligible under the ACA. Enrollment also increased among children (12%) and older adults (55%); while these groups were not significantly affected by the ACA, the state funded Medi-Cal expansions to undocumented immigrants in these age groups during this time period.
Federal policy responses to the pandemic also led to sizable increases in Medi-Cal enrollment. Under federal Medicaid rules, enrollees must undergo annual redeterminations to make sure they are still income-eligible. This process was paused during the pandemic to ensure insurance coverage. As a result, Medi-Cal enrollment increased about 26% between February 2020 and April 2023, when the federal public health emergency ended and the redetermination process resumed. Enrollment has declined since then; as of October 2023 (the most recent month of data available), about 14.9 million people were enrolled, a decrease of nearly 7%—and enrollment is likely to drop further by May, when all enrollees who skipped redeterminations during the pandemic should have had an annual redetermination.
As of November 2023, about 1.1 million people have had been disenrolled—the vast majority were dropped for procedural reasons (e.g., failure to complete required paperwork). It is difficult to know how many of those who have been disenrolled have access to other health coverage, but one study estimated that about 20% of people who lost Medi-Cal coverage once redeterminations restarted would become uninsured. Monitoring the redetermination process can help maintain the coverage gains over the past decade.
An especially important issue is making sure Medi-Cal enrollees can get needed health care services. Medi-Cal payment rates are lower than those of other health insurance coverage, and this has long raised concerns about whether the program provides adequate access to care. Several recent policy initiatives have focused on this issue; most recently, AB 119 (2023) authorized a new Managed Care Organization (MCO) tax intended to support increased Medi-Cal payment rates for certain providers in 2024 and 2025.
The state lacks good information on how many providers serve Medi-Cal enrollees, which makes it challenging to evaluate the effectiveness of these rate increases. New data sources are under development, which could help, but devising better ways to track provider participation in the Medi-Cal program should be a priority.
According to the governor’s 2024–25 budget proposal, state and federal Medi-Cal spending will exceed $150 billion—making it by far the largest state program. While the federal government covers about 70% of Medi-Cal’s costs, state General Fund expenditures are projected to be about $35 billion this fiscal year. Despite the state’s current budget challenges, the proposed budget maintains sizable new state investments for Medi-Cal expansions to undocumented adults. This underscores the crucial role the program plays—and reinforces the importance of making sure Medi-Cal enrollees have access to health care providers.