CSAC warns HR 1 could shift billions in health costs to counties; El Dorado supervisors back letters asking for state mitigation
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Summary
The California State Association of Counties told the board that federal HR 1 could leave counties responsible for large new costs and extra eligibility work; the board approved letters asking the governor and legislative leaders to fund mitigation in the state budget.
Graham Knauss, CEO of the California State Association of Counties (CSAC), told the El Dorado County Board of Supervisors on April 7 that federal legislation known as HR 1 will materially change Medicaid (Medi-Cal) eligibility and could re-establish county obligations for indigent care, resulting in an estimated statewide fiscal exposure in the billions and sharply increased county eligibility workload.
Knauss said county analysis suggests HR 1 could lead to roughly 1.4 million people no longer covered by Medi-Cal; CSAC's planning assumption is that about one-third of those individuals will instead fall to county indigent-care programs, while the rest may receive no coverage. CSAC is asking the state to recognize and mitigate county fiscal exposure in the May budget process.
Key points from CSAC briefing: Knauss described three primary impacts: direct cost shifts where counties would fund care previously paid by Medi-Cal; a near-doubling of workload for eligibility determinations (counties currently perform eligibility functions for state and federal programs); and indirect behavioral-health impacts as people lose mild-to-moderate Medi-Cal coverage and some proportion deteriorate into more acute needs that counties must address.
"Counties are the providers of last resort," Knauss said. He outlined a county-led budget request to the state: approximately $1.9 billion in 2026-27 and larger amounts in subsequent years to hold counties harmless and rebuild clinic capacity where it has eroded since the Affordable Care Act expansion. Knauss emphasized urgency because the governor's May revision (May 14) will shape legislative negotiations.
Board reaction and action: Supervisors expressed concern about rural hospitals and county service capacity. The board approved sending letters to the governor, the Senate president pro tem and the Assembly speaker requesting state action to mitigate the fiscal and operational impacts of HR 1 and asked staff and CSAC to continue legislative outreach. The vote to approve the letters and support CSAC's request passed 4-0 with Supervisor Lane absent.
Next steps: CSAC is coordinating county outreach, legislative briefings and a public/media strategy to elevate the issue before the May revision; the board asked staff to help facilitate meetings with the county's legislative delegation and to consider participation in CSAC-organized advocacy and media outreach.
