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What federal and state policies affected eligibility and enrollment numbers for California's Medi-Cal expansion?
Executive summary
California’s recent Medi‑Cal enrollment and eligibility shifts reflect a mix of state expansions (undocumented adults and older adults), temporary pandemic-era enrollment flexibilities ending, and 2025–26 budget-driven rollbacks such as restored asset limits and enrollment freezes — all of which the Legislative Analyst’s Office and other state sources tie to measurable caseload changes (senior caseload ~225,000 higher than a pre‑pandemic baseline; at least 165,000 enrolled due to eligibility expansions) [1] [2]. Federal action — notably H.R. 1 (signed July 4, 2025) — also forced statutory changes affecting retroactive coverage, asset rules, and other eligibility mechanics that California is implementing through DHCS guidance and state legislation [3] [4].
1. State expansions drove new enrollees — and higher costs
California’s Legislature purposely expanded Medi‑Cal eligibility in several ways that raised enrollment: making low‑income undocumented immigrants eligible for comprehensive coverage and enacting older‑adult eligibility expansions; those moves “have had their intended effects,” with the senior caseload about 225,000 above a pre‑pandemic baseline and at least 165,000 of those attributable to eligibility expansions rather than pandemic policies, according to the Legislative Analyst’s Office [2] [1].
2. Pandemic-era rules and the “unwinding” affected totals
Enrollment remained unusually high during COVID because of continuous‑coverage mandates and administrative flexibilities; the Legislative Analyst’s Office notes that the end of those policies is expected to reduce enrollment over time, and that some portion (up to roughly 60,000 seniors by their estimate) of recent senior caseload increases were tied to continuous coverage and unwinding flexibilities rather than new eligibility alone [2] [1].
3. 2025–26 budget and AB 116: reversals and savings measures
California’s 2025–26 budget package — primarily implemented through AB 116, the health omnibus trailer bill — reinstated an asset limit for many Medi‑Cal programs (e.g., $130,000 for an individual) and instituted enrollment freezes and other savings measures (e.g., an “enrollment freeze” for undocumented adults 19+ effective Jan. 1, 2026) that the state projects will reduce spending — figures cited in summaries include $45 million in 2025‑26 from asset‑limit restoration and $86.5 million from excluding specialty weight‑loss drugs, with larger ongoing savings projected [5].
4. Federal law (H.R. 1) forced eligibility and process changes
H.R. 1 (the “One Big Beautiful Bill Act”), signed in July 2025, included provisions that alter Medicaid/Medi‑Cal rules — for example, reducing retroactive coverage months for ACA‑expansion members and triggering reinstatement of asset limits and other implementation changes in California. DHCS issued guidance noting provisions from H.R. 1 and announcing forthcoming county letters to implement federal changes [3] [4].
5. DHCS and program‑level operational changes (Medi‑Cal Rx, rates, notices)
DHCS is implementing Medi‑Cal Rx policy changes and pharmacy‑benefit updates (with staged dates beginning Nov. 1, 2025 and more restrictive rules in Jan. 2026) and has posted eligibility and rate guidance to reflect budget and federal law shifts; provider and advocacy groups (e.g., California Medical Association, Medi‑Cal Rx notices) flagged these operational changes as part of the 2025‑26 implementation sequence [6] [7] [8].
6. Who is affected and how enrollment dynamics differ by group
Different policy levers affect groups unevenly: undocumented adult expansion brought new coverage to ages 26–49 (SB 184 and related state actions), senior expansions and temporary elimination of asset tests led to rapid growth in the older adult caseload, while budget rollbacks (asset limits, enrollment freezes) disproportionately target higher‑income or non‑citizen adult groups and aim to constrain future growth [9] [1] [5].
7. Advocacy and watchdog perspectives — competing interpretations
Advocates such as Disability Rights California and legal/consumer groups highlight that H.R. 1 and state budget bills will create concrete barriers (e.g., home‑equity limits for long‑term care, reinstated asset tests, enrollment modifications) and warn about impacts on continuity of care, while state fiscal analyses (LAO) emphasize the intentional tradeoff: expansions increased coverage and caseloads, and recent budget actions are designed to curb spending and enrollment growth [4] [1] [2].
8. Limitations and what the sources don’t show
Available sources document the policy changes, budgetary intent, and LAO estimates about senior caseload impacts, but do not provide a comprehensive, up‑to‑the‑minute accounting of total Medi‑Cal enrollment across every demographic through 2025 or micro‑level churn data by county; they also don’t quantify the full projected enrollment declines (if any) after the 2026 implementations beyond the stated savings estimates [1] [5] [3].
Conclusion — policy tradeoffs are explicit: California’s legislative expansions expanded access and materially increased certain caseloads (especially seniors and undocumented adults), while federal H.R. 1 and the 2025‑26 state budget prompted restorations of asset tests, enrollment freezes, and program changes intended to reduce costs and slow future enrollment growth; sources differ on emphasis — advocacy groups stress access harms, analysts stress fiscal and enrollment consequences [1] [5] [4].