California could lose up to 217,000 jobs if Congress cuts Medicaid, analysis says
California could lose up to 217,000 jobs if Congress cuts Medicaid, according to a policy brief by the UC Berkely Labor Center.
About two-thirds of the lost jobs (up to 145,000 jobs) would be in health care sectors, including jobs at hospitals, clinics, nursing homes, insurance companies, and home care, according to the policy brief.
Republicans unveiled a legislation earlier this month with at least $880 billion in cuts to Medicaid by 2034 to offset the cost of $4.5 trillion in tax breaks, the Associated Press reported.
The cuts to Medicaid, also known as Medi-Cal in California, over a 10-year period are part of plans to slash trillions of dollars in federal spending to offset the Trump Administration’s proposed tax cuts.
According to the policy brief, released April 28, the federal cuts would not only threaten health care access for 15 million Californians currently enrolled in Medi-Cal, but would also lead to the loss of health care jobs and other jobs in the state, putting hundreds of thousands of people out of work.
“Hundreds of thousands would lose jobs at a time when economists already warn of a potential recession,” said Laurel Lucia, director of the Labor Center’s health care program.
Lucia said Medi-Cal is an essential source of funding for many healthcare providers, including hospitals, clinics and nursing homes.
“If these federal cuts go through, those providers will have fewer resources, and that could impact staffing levels and access to care for people with all types of insurance,” Lucia said.
The state could expect to see between $10 billion and $20 billion fewer federal dollars per year coming to the state’s Medi-Cal program, a key pillar to California’s health care system. More than one-third of the state’s population is covered by Medi-Cal.
According to the Labor Center, approximately 2.65 million Californians (14% of the state’s workforce) were employed in a range of health care sectors.
The potential cut would impact local economies as health care systems serve as major employers and economic engines for their regions.
“Slashing Medi-Cal funding would have disastrous effects, destabilizing community health centers and clinics that would result in cutbacks to health services, reduction in staffing and even clinic closures,” said Anna Marshall, associate director of federal affairs and policy for the California Primary Care Association. The CPCA association represents thousands of community health centers and clinics across the state.
“If Medi-Cal gets cut, it doesn’t just affect Medi-Cal patients in rural areas. It impacts everybody who’s going to need to use those primary and preventative care services when that provider no longer has availability because of staff reductions or actually closes their doors because they can no longer afford to stay open,” Marshall said.
Fresno County would lose between 3,700 to 7,300 job loss if federal Medi-Cal spending is cut by $10-20 billion per year, according to Labor Center estimates.
Madera County would lose between 500 to 1,000 jobs. Merced County would slash between 1,000 to 2,000 jobs and Tulare County would lose between 1,900 to 3,800 jobs.
The estimated job loss in U.S. Rep. David Valadao’s congressional district is between 3,400 to 6,900 jobs in 2026 if Medicare cuts are approved. Many Central Valley families in Valadao’s district at risk of losing health care have urged the Republican congressman to oppose the Medicaid cuts.
Medi-Cal payments to hospitals totaled $820 million, or 50% of net patient revenue in Valadao’s district, according to the California Health Care Foundation.
“More than 41 percent of our patients rely on Medi-Cal for access to essential health services. Cuts of this magnitude would severely destabilize local health care systems like ours, threatening the very foundation of care in the Central Valley,” said Donna Hefner, president and CEO of Sierra View Medical Center in Porterville.
According to the California Health Care Foundation, Sierra View Medical Center in Valadao’s congressional district gets 41% of net patient revenue from Medi-Cal.
The Labor Center estimates that Medicaid cuts would also result in $860 million to $1.7 billion in reduced state and local tax revenue.
This story was originally published May 19, 2025 at 10:10 AM with the headline "California could lose up to 217,000 jobs if Congress cuts Medicaid, analysis says."
