Public Hospital Systems and Workers Sound Alarm at State Capitol, Urge Emergency Response to Looming Health Care Crisis
Facing billions in annual losses from H.R. 1 and the Governor’s May Revise budget, California’s public hospital systems and workers call for $500 million in state support to keep life-saving services available for millions of patients who depend on them.
SACRAMENTO, CA — As negotiators finalize a budget for California, lawmakers joined public hospital system CEOs, doctors, nurses, and workers at the State Capitol to urge the inclusion of $500 million as an initial step to stabilize the operations of California’s 17 public hospital systems facing nearly $3 billion in annual losses from the impacts of H.R. 1 and $800 million in annual losses from Governor Gavin Newsom’s May Revise budget.
“No matter how well run, how lean or how committed its staff, no hospital system can absorb financial losses of this magnitude without stark cuts to services that will restrict health care access for millions of patients,” said Katie Rodriguez, Interim President and CEO, California Association Public Hospitals and Health Systems. “We are on the front lines of a preventable health care crisis and we urgently need help. The decisions state leaders make over the next month will decide how painful and deadly this crisis becomes in communities across California.”
“Public hospital systems are the backbone of health care in California,” said Assemblymember Patrick Ahrens (D-Silicon Valley), a member of the State Assembly’s Budget Committee who authored and is championing the $500 million budget request in the legislature. “I was born in a public hospital and refuse to stand by while they are torn apart. Without strong public hospital systems in California, health care access collapses and people suffer. We can prevent this crisis through an emergency response. It’s time for the state to extend a financial lifeline to public hospital systems now.”
Enacted by the federal government last year, H.R. 1 – or the One big Beautiful Bill Act – cuts $1 trillion from the nation’s health care over the next decade. In California, the impact of these cuts will fall primarily on the communities relying on California’s health safety net, or Medi-Cal, and the public hospital systems serving them. Altogether, these cuts will cause California’s public hospital systems to face more than $3 billion in losses every year and nearly 2 million Californians to lose their coverage next year.
Governor Newsom’s May Revise budget makes the troubles of public hospital systems worse, costing them $800 million a year in reduced reimbursement rates for care provided to immigrants through Medi-Cal.
California’s public health care systems, which include county-owned or affiliated systems and five University of California academic medical centers, are the backbone of health care access in the state. Comprising just 8% of the state’s hospitals overall, the 3.7 million patients they serve equate to 35% of all Medi-Cal and uninsured care. They also operate 67% of the state’s burn beds, 32% of psychiatric beds, and 15% of neonatal intensive care beds while training nearly half of all new doctors in hospitals.
“If we are forced to cut services, there is no hospital waiting to fill the gap. Other hospitals will not open a unit to treat burns or provide neonatal intensive care because public funding dried up,” said Dr. Chester J. “CJ” Kunnappilly, Chief Executive Officer, San Mateo Medical Center. “Once those services are gone, they are gone and all of us pay the price through more preventable illness, longer wait times for essential care, and higher costs.”
“Every 11 minutes, someone in Santa Clara County is taken by ambulance to one of our four County‑run hospitals, which handle nearly half of local emergency rooms visits and 80% of trauma cases. This life-saving system is now at risk due to federal funding cuts that could lead to patients overwhelming other area hospitals,” said Dr. Brian McBeth, Hospital Executive, Santa Clara Valley Medical Center. “We’ve restructured services, eliminated vacant positions, maximized reimbursements, and pursued every efficiency possible, but without State action to protect public hospitals, families’ access to care and the future of our emergency rooms remain at risk.”
“I am very concerned that the patients my coworkers and I serve will have worse care options tomorrow than they have today,” said Derrick Boutte, Environmental Services worker at Alameda Health Systems and East Bay President of SEIU Local 1021. “With safety-net health systems moving to layoff critical staff, even if someone reaches a hospital for life-saving care, that hospital might not offer the same services tomorrow that it does today. Unless the state steps up, there will be devastating impacts to communities and families across California.”
“When the federal funding supporting residency programs is cut due to H.R. 1, the effect is not only immediate but will get worse over time,” said Dr. Mark I. Rosenblatt, Vice Chancellor of Human Health Sciences, UC Davis Health. “In five to ten years, in California, we will be further behind than today in terms of educating enough physicians to meet the needs of patients. And you can’t simply rebuild this pipeline quickly. The consequences of state leaders not providing the funding we’re seeking in the state budget will be felt for generations.”
Today, 7.1% of Californians are uninsured – a record low. If state leaders do nothing and stand by while H.R. 1 is implemented, this figure will grow to 15%.
“We expect 660,000 people in Los Angeles County will lose Medi-Cal coverage but they will not stop needing health care. They will still come to our emergency rooms, forcing us to absorb those costs without reimbursement,” said Andrea Turner, Chief Executive Officer, Harbor-UCLA Medical Center. “This pressure will not stay contained within our walls. Every emergency room in the county will feel the strain.”
“For most of our patients in Riverside County managing chronic disease without consistent care access, we are not their last resort. We are their only option.” said Dr. Mike Mesisca, Department Chair, Emergency Medicine, Riverside University Health System. “Today, we call on our state leaders to give the doctors and nurses serving our safety net public hospitals the resources they need to protect our children, parents, friends, and neighbors from preventable deaths in our communities.”
“San Francisco has built one of the country’s most integrated models for addressing homelessness and health connecting patients in our emergency department to social services and wraparound care,” said Dr. Hemal Kanzaria, Chief of Performance Excellence, Zuckerberg San Francisco General Hospital. “This capacity to coordinate care is built on stable funding for us. Cut the funding and the coordination collapses. The patients don’t disappear. They suffer as their well-being worsens.