California projects $11.9 billion shortfall; May revise proposes Medi‑Cal enrollment freeze and new premiums

The governor submitted California’s May revision Thursday, saying the state faces an $11.9 billion shortfall in the budget year and a projected two‑year revenue downturn of about $16 billion tied to federal actions.

“We estimate the impacts … we’re gonna see an impact about a $16,000,000,000 downturn,” the governor said as he introduced the May revision to the Legislature and press.

The revision sets a $321.9 billion total budget, including $226.4 billion in general fund spending and $15.7 billion in total reserves. Officials said the decline stems largely from lower capital gains, reduced wage and corporate profit projections and broader economic uncertainty linked to federal policy and tariffs.

Why it matters: Medi‑Cal (California’s Medicaid program) is the largest single driver of growth in the state budget. The governor’s package includes a series of proposals meant to reduce projected Medi‑Cal general fund growth without withdrawing coverage from people already enrolled.

Key proposa…