UC Health Policy Updates Impact of Historic Medicaid Cuts and Advocacy Efforts

The University of California's Health Services Committee convened on July 13, 2025, to discuss significant changes in health policy following the recent reconciliation bill signed into law on July 4. This legislation marks the largest cut to Medicaid in history, reducing spending by a staggering $1 trillion over the next decade. The implications for California's Medi-Cal program, which is crucial for the state's academic health centers, are profound.

Tam Mahers, the Associate Vice President of Health Policy and Regulatory Affairs, highlighted that Medi-Cal accounts for 20% of the net patient revenue for UC's health facilities, with federal funds covering two-thirds of its costs. The recent cuts threaten to destabilize this essential funding source, potentially leaving an estimated 1.5 to 2 million Californians uninsured by 2034.

Kent Springfield, Director of Health and Clinical Affairs, detailed the advocacy efforts undertaken by UCHealth to mitigate the impact of these cuts. The UC advocacy network mobilized over 2,800 advocates, sending nearly 5,000 emails to California's congressional delegation, emphasizing the potential harm of Medicaid reductions. Despite these efforts, the final bill included provisions that will limit states' abilities to finance Medicaid programs and increase barriers to enrollment.

Key changes include a freeze on state-directed payments, which are vital for UC's reimbursement for Medicaid services, and a reduction in the federal matching rate for emergency Medicaid services for undocumented immigrants. These adjustments are expected to result in a cumulative reduction of approximately $100 million for UCHealth.

The bill also introduces new eligibility requirements, including work mandates for Medicaid recipients, which could complicate access to care for many. The committee expressed concerns that these changes would lead to increased emergency department visits as patients forgo necessary specialty care due to new cost-sharing requirements.

Looking ahead, the committee plans to monitor the implementation of these provisions closely and continue advocating for the state's interests. They aim to educate policymakers about the far-reaching impacts of the reconciliation bill and explore opportunities to delay or mitigate the effects of these cuts on California's healthcare system. The discussions underscored the urgent need for ongoing advocacy and strategic planning to navigate the challenges posed by these significant policy changes.