News Analysis: The healthcare cuts approved by Trump, Republicans go well beyond Medicaid

Los Angeles Times

3 days ago

SACRAMENTO — The federal safety-net healthcare system for low-income and disabled Americans, Medicaid, won't be the only medical coverage devastated by the package of spending cuts and tax breaks signed into law by President Trump on the Fourth of July.
Covered California, the state's Affordable Care Act health insurance marketplace, estimates that as many as 660,000 of the roughly 2 million people in the program will either be stripped of coverage or drop out due to increased cost and the onerous new mandates to stay enrolled. Those who do stay could be hit with an average monthly premium increase of up to 66%.
This is Phil Willon, the L.A. Times California politics editor, filling in for columnist George Skelton this week.
To find out more about how the millions of Californians who rely on Covered California for health insurance will be affected by Trump's megabill, I spoke with Jessica Altman, the organization's executive director.
We spoke on Thursday, while the Republican-led U.S. House of Representatives was voting to approve the reconciliation legislation. According to estimates by the nonpartisan Congressional Budget Office, the package will lead to 11.8 million more people going without health insurance nationwide over the next decade.
Covered California serves as a marketplace exchange for state residents seeking healthcare insurance under the federal Affordable Care Act, widely known as Obamacare, allowing them to select from name-brand insurance providers and choose from a variety of coverage plans.
'A quarter of the people we cover are sole proprietors. That's everything from mom-and-pop Etsy shops to a consultant, a highly educated tech worker in San Francisco doing contract work. We really have that full spectrum,' Altman said.
Covered California also serves as a health insurance sanctuary for residents whose income rises enough for them to lose eligiblity for Medi-Cal, as Medicaid is known in California, or those who work for companies that don't provide benefits.
The current cost for basic coverage ranges from $0 a month for individuals earning around $21,000 — just above the income eligibility for Medi-Cal — to 8.5% of the income of people making $75,000 or more, Altman said.
The vast majority of Californians receive federal subsidies to lower their premiums, including many middle-income families who had become eligible when Congress expanded the financial assistance in 2021.
Those subsidies were not renewed in the Trump megabill. In theory, the Republican-led Congress could remedy that before the end of the year but, given that Trump spent most of his first term in office trying to repeal the Affordable Care Act, the odds of that appear slim.
'We have many, many people paying less than $10 a month for their health insurance. We're going to lose that price for sure,' Altman said. 'We also have people, that person making $75,000 a year … they're going to lose all of their tax credits and potentially pay hundreds more a month.'
And that price increase will start to hit home in four months, when Covered California's open enrollment signup period begins for 2026.
Thousands of Californians will drop their coverage because they can no longer afford the expense, Altman predicts.
'This is a moment where Americans and Californians are so financially strained: Their rent, their food, their gas, their child care, all of their transportation, all of these things,' Altman said. 'They are not in a position today where they feel like any of those costs can rise by 66%.'
Altman said the governor and California Legislature budgeted an additional $190 million for Covered California, which hopefully will help reduce the number of residents who will lose their healthcare coverage. But, she said, it's nowhere near enough to make up for the federal cuts.
Approximately 112,000 lawful immigrants in California also will be stripped of premium tax credits and cost-sharing support, essentially pushing health coverage out of financial reach, she said. That includes immigrant groups that have been eligible for assistance for years, including those with work and student visas, refugees, asylees and victims of human trafficking.
'They are limiting it so only green card holders and a couple of very nuanced categories of certain Cuban immigrants and certain immigrants from Pacific Island nations can get financial assistance,' Altman said.
Immigrants who grew up in the United States after being brought here illegally as children, a group known as 'Dreamers,' will be stripped of their eligibility, Altman said.
Thousands more Californians likely will drop coverage because of new burdensome verification requirements, including increased tax filings, and bureaucratic hurdles that must be overcome to maintain eligibility.
California Gov. Gavin Newsom already has warned that the cuts to Medicaid in what Trump calls the 'Big Beautiful Bill,' a cornerstone of his second-term agenda, will lead to hospital and clinic closures, especially in the state's underserved rural areas.
Altman said that impact will be exacerbated by the tens of thousands of Californians expected to lose their medical insurance they secured through Covered California. Medical facilities received higher compensation to care for patients who secured health insurance through Covered California than they do for patients on Medi-Cal. And hospitals and clinics will now take an even greater financial hit for caring for Californians with no health insurance, raising healthcare costs for everyone else.
'We know people will get less healthcare. They will not get their preventive care, they will not get their primary care at the rates that they do when they're covered,' Altman said. 'But when they really need care, they're going to go get it. They're going to get it at the emergency room, and our system is going to pay for it anyway.'
The must-read: Valadao votes for a Trump megabill expected to disrupt healthcare for many in the Central Valley The TK: Gov. Newsom will visit South Carolina, a pivotal presidential primary state The L.A. Times Special: Kidnappers or ICE agents? LAPD grapples with surge in calls from concerned citizens
—Was this newsletter forwarded to you? Sign up here to get it in your inbox.