Blog: Children’s Health Coverage Under Threat

Key Takeaways & Calls to Action from the LA Partnership’s March 2026 Legislative Briefing

California families – especially young children and low-income communities – are facing a mounting crisis driven by federal and state policy decisions.

On March 5th, the LA Partnership hosted a legislative briefing with policy experts and health leaders to discuss urgent actions needed to protect and expand health coverage for our youngest stakeholders as state policymakers and Governor Newsom agree on the final upcoming year state budget.

Here’s a snapshot of what’s at stake:

The Federal Threat is Real – H.R. 1, the Republican “megabill” moving through Congress, would gut Medi-Cal and CalFresh to fund corporate tax cuts – shifting an estimated $2.3 to $5.1 billion in food assistance costs to California and up to $9.5 billion annually in health and food assistance costs onto county governments. Hospitals, food banks, and public health clinics are already feeling the strain, with hiring freezes and clinic closures underway.

The Governor’s Budget Falls Short – Despite projected reserves exceeding $20 billion and significant revenue growth, the Governor’s proposed 2026–27 budget does not address corporate tax loopholes, underfunds immigrant communities, and lacks a plan for the anticipated loss of Medi-Cal funding related to managed care organization taxes.

On-the-Ground Impact:
Large-scale coverage losses would significantly increase uncompensated care costs for safety-net providers, further straining hospitals and clinics already operating on narrow margins. Historically, such funding disruptions have resulted in service reductions, emergency department overcrowding, delayed preventive care, and, in some cases, facility closures or consolidations – particularly in communities with high Medi-Cal enrollment. The LA County Department of Public Health has already reported the closures of several clinics this year.
Increased ICE activity is intensifying health hesitancy. Pediatricians report delayed prenatal care, declining vaccination rates, and families hesitant to seek treatment.
Further, the Governor’s budget includes plans to impose work reporting requirements on undocumented Californians enrolled in Medi-Cal, something that is not required by H.R.1 and will increase barriers for low-income families seeking health coverage.
Relatedly, ICE activities are expected to result in an economic downturn in Los Angeles County, which is home to 950,000 undocumented residents who the LA County Department of Economic Opportunity and Economic Development Corporation report generate $254 billion annually in economic output.
For Los Angeles County, the consequences extend beyond individual coverage losses. Medi-Cal funding underpins the region’s health care infrastructure – sustaining public hospitals, community clinics, Federally Qualified Health Centers (FQHCs), behavioral health providers, and maternal and pediatric care systems that collectively serve millions annually.
Closures or downsizing of medical facilities would have profound economic consequences for Los Angeles County. Health care is one of the region’s largest employment sectors, employing thousands – including physicians, nurses, community health workers and behavioral health professionals. Instability in Medi-Cal financing risks workforce displacement, reduced local economic activity, and cascading impacts on vulnerable neighborhoods.

The moment requires unified, cross-sector advocacy. The communities most at risk cannot wait.

We sincerely thank the speakers at the LA Partnership for Early Childhood Investment’s 2nd annual Legislative Briefing for their insights and critical work on behalf of the youngest Californians: Chris Hoene, Executive Director, California Budget & Policy Center; Stephen Cheung, President & CEO, Los Angeles County Economic Development Corporation (LAEDC); Dr. Shannon Thyne, Director of Pediatrics, Los Angeles County Department of Health Services; Chief of Pediatrics, Olive View-UCLA Medical Center; Jennifer Vanore, PhD, President & Chief Operating Officer, UniHealth Foundation; and, Joseph Villela, Director of Government Relations, The California Wellness Foundation.