California’s Massive Medicaid Shortfall Would Disappear If It Quit Paying $8B For Illegals’ Health Care Recently, California Democrat Gov. Gavin Newsom informed the legislature that the state would need to borrow $3.44 billion — the maximum amount permitted by law — to tide the Medicaid program over through the end of March. Days later, Newsom said he would need to raid the state’s general fund by another $2.8 billion to cover the Medicaid shortfall between now and the end of California’s fiscal year. That’s a total of $6.2 billion in Medicaid bailouts just to help carry the program until the end of June. Newsom’s office claimed the spike in Medicaid costs relates more to broader national trends than to the immigrant program specifically. (States do not receive federal Medicaid matching funds to cover illegal immigrants, except for emergency care, but they can finance these populations with state funds.) Those arguments don’t hold up to close scrutiny on multiple levels.