To: Board of Supervisors
From: Dr. Grant Colfax, Health Services Director
Report Title: Impacts of H.R. 1 and the State Changes to Medicaid Policy on the Health Services Department
☒Recommendation of the County Administrator ☐ Recommendation of Board Committee
RECOMMENDATIONS:
1. CONSIDER accepting the report on the impacts of H.R. 1 and State changes to Medicaid policy; and
2. CONSIDER directing the Health Services Director to review and amend eligibility requirements and standards for the Basic Health Care program established by Resolution No. 2002/312; and
3. DIRECT Contra Costa Health (CCH) to return to the Board in early 2026 with proposed amendments or alternatives to the Basic Health Care program.
FISCAL IMPACT:
This informational report has no direct fiscal impacts. It reviews the fiscal and operational effects of H.R. 1 and recent Medi-Cal policy changes on CCH, highlighting challenges, priorities, and proposed actions to address adverse impacts on healthcare services.
BACKGROUND:
Signed into law on July 4, 2025, H.R. 1 introduces significant changes to Medi-Cal, including financing restrictions and eligibility barriers that will reduce federal support and make it more difficult for residents to obtain or maintain coverage. State changes further reduce eligibility and reduce reimbursement to Federally Qualified Health Centers for care provided to adults with Unsatisfactory Immigration Status (UIS).
Healthcare Coverage Loss
Estimates from the Employment and Human Services Department (EHSD) suggest that as many as 93,000 Contra Costa residents may lose Medicaid coverage by 2029.
Eligibility changes between 2026 and 2029 include asset reporting requirements, elimination of dental coverage for UIS adults, new work requirements, biannual renewals, copays, and enrollment freezes. These changes are projected to result in a loss of as many as 83,000 Contra Costa Health Plan (CCHP) members and as much as $41 million financial impact to CCHP.
Potential Financial Loss
Over the next four years, CCH anticipates a cumulative funding reduction of as much as $328 million, including $180 million from disenrollment and $148 million from reduced supplemental funding
Uncertainty and Risk
Uncertainty surrounding implementation and enforcement of these federal and state policies escalates over time, with the most significant impacts expected between FY27 and FY29.
Immediate Response
Immediate priorities include determining fiscal effects on Contra Costa Regional Medical Center (CCRMC) and CCH Clinics, optimizing operational efficiency, collaborating with EHSD and other community partners to keep residents enrolled in Medi-Cal, and determining the most effective means for the county to fulfill its section 17000 obligations.
CONSEQUENCE OF NEGATIVE ACTION:
This item provides information to County leadership and the community about the impacts of federal and state policies on the impacts of federal and state policy changes that impacts CCH financial outlook, operations, and the people we serve. Without this item, the Board will not be able to provide direction to CCH staff on next steps for implementation and analysis of these impacts.