How will HR 1 affect Medi-Cal in CA in 2026
Executive summary
H.R. 1, enacted in mid-2025, triggered a series of federal policy shifts that by 2026 materially change Medi‑Cal’s eligibility rules, benefits and federal financing—most immediately by reinstating asset tests for certain adults, freezing full‑scope enrollment for some adult immigrants, and starting a sequence of reduced federal matches and provider restrictions that will pressure state budgets and providers [1] [2] [3]. California agencies, counties and advocacy groups report that these changes will reduce coverage for some populations, raise administrative burdens, and create fiscal shortfalls that the state is trying to mitigate through its 2025 budget actions and implementation guidance [4] [5] [6].
1. Eligibility shifts taking effect in January 2026: who gains and who loses
Beginning January 1, 2026, California will require asset information for applicants and certain current beneficiaries—returning an asset test for adults 65+, people with disabilities, nursing home residents and some families—and will freeze full‑scope Medi‑Cal enrollment for adults 19+ without satisfactory immigration status who apply on or after that date, while preserving coverage for those already enrolled before the freeze [1] [2] [7]. County and plan notices underscore that some adult immigrants will no longer be able to sign up for full‑scope Medi‑Cal and that impacted people need to report assets at renewal or on application [7] [8].
2. Financial hit and downstream access pressures on providers
Analyses from California policy centers estimate sweeping federal funding reductions—figures cited include roughly $30 billion a year in lost federal support for Medi‑Cal—which would shrink program capacity, threaten safety‑net providers, and risk millions losing coverage over several years; these projections underpin state concern about provider viability and access [9] [6]. The Legislative Analyst’s Office warns H.R. 1 alters federal payment rules (for example, family‑planning payment prohibitions and reduced federal match for some emergency services) that could lower federal shares and complicate budgeting for 2026 and beyond [5] [3].
3. New administrative rules that will increase churn and verification burdens
H.R. 1 introduces new requirements—asset verification, changing immigrant eligibility categories, and upcoming community‑engagement (work) rules for some adults—that will demand IT, county eligibility and outreach resources and likely increase casework, renewals hurdles and coverage churn in 2026 [3] [10] [1]. State and local agencies have launched guidance webinars and county notices to help implement changes, signaling active mitigation but also acknowledging practical limits for timely outreach [4] [2].
4. Specific service reductions and timing Californians should expect in 2026
Some service changes are already sequenced into 2026: reductions in dental coverage for certain adult immigrants are scheduled for July 1, 2026, and federal prohibitions on payments to certain family‑planning providers affected service flows earlier in the 2025–26 window [7] [5]. Analysts caution that even when children remain technically eligible, household disruptions and administrative red tape could cause collateral coverage losses among children and families in 2026 [11].
5. State responses, tradeoffs and political agendas shaping outcomes
California’s 2025 budget and agency guidance attempt to blunt H.R. 1’s impacts—some measures phase changes to allow adjustment—but the state faces constrained fiscal capacity and political choices about using state dollars to backfill federal cuts [5] [4]. Advocacy groups frame H.R. 1 as a deliberate rollback that will shift costs and worsen health access [6] [12], while state officials emphasize implementation logistics and mitigation; these competing frames reveal advocacy and fiscal agendas that will shape how many Californians actually lose services in 2026 [4] [6].
Bottom line: what Medi‑Cal will look like in 2026
By calendar year 2026 Medi‑Cal will still operate as California’s Medicaid program but with narrower eligibility pathways for some immigrants, reinstated asset tests for specific groups, new administrative verification burdens, and early service reductions—changes that together reduce enrollment growth and increase strain on budgets and providers unless the state offsets federal retrenchment [1] [2] [9]. Projections vary by source on scale—ranging from hundreds of thousands to millions affected—and much depends on state mitigation choices, county implementation capacity, and forthcoming federal or judicial developments not covered in the cited materials [9] [6] [5].