Image by Julio César Velásquez Mejía from Pixabay
State Budget Includes More Than $1 Billion this Year to Protect Health Care, including $250 Million to Support Public Hospital Systems and Lifesaving Care
August 11, 2026 - SAN JOSE, CA – Assemblymember Patrick Ahrens (D-Cupertino) and Assemblymember Ash Kalra (D-San Jose) joined with County of Santa Clara and Santa Clara Valley Healthcare leaders, the California Association of Public Hospitals, SEIU California healthcare workers, and County doctors and nurses for a press conference in front of O’Connor Hospital in San Jose to highlight landmark state investments to protect health care access for Californians including $250 million for public hospitals, while vowing to continue to fight for long-term solutions to ensure access to lifesaving health care services put at risk by draconian federal cuts.
Sweeping federal budget cuts in H.R. 1, the so-called “One Big Beautiful Bill Act” enacted into law by Donald Trump and Congressional Republicans, exceed $1 trillion to health care programs across the nation, including more than $3 billion annually to California’s public hospitals, and $1 billion in the County of Santa Clara. Overall, California’s Medicaid program, known as Medi-Cal, is estimated to lose up to $30 billion per year in funding.
Assemblymember Patrick Ahrens, Chair of the Assembly’s Committee on Aging & Long-Term Care, and a member of the Budget Committee, said, “Because of unnecessary federal budget cuts, hospitals, clinics and other healthcare services will shutter and access to care will be severely restricted resulting in avoidable death and cruel inflicted pain to families, but I fought for and California invested record levels of state funding in our healthcare system including $250 million for public hospitals to reduce the immediate risks and protect people. This will impact everyone, even if you and your employer pay for your healthcare, with less access to care and higher prices. The worst impacts of federal cuts are still to come, so I will continue to work with colleagues, public officials, stakeholders, and citizens alike to find and implement solutions to ensure all people have access to life-saving care.”
In addition to $250 million supporting public hospitals, California’s 2026-27 budget includes $300 million for the Covered California State Subsidy Program to reduce health insurance costs, $200 million for loans to protect distressed hospitals, and $420 million to support counties implementing H.R. 1-imposed Medi-Cal and CalFresh eligibility changes, including surge staffing capacity. H.R. 1 requires that Medi-Cal and CalFresh eligibility now be reestablished twice per year - instead of annually - doubling bureaucratic paperwork and workload on already overburdened county workers.
“I’m grateful we secured critical investments in this year's state budget that will help stabilize our public hospitals, preserve access to care, and fill in the funding gaps that the federal government has created with HR1,” said Assemblymember Ash Kalra. “But as we heard today, the work is far from over. We must continue looking for every possible solution to protect access to healthcare and ensure that our communities are not left to bear the burden of the poor decisions made in Washington.”
The unprecedented reductions of federal healthcare funding in H.R. 1 amount to the largest cut in Medicaid’s 60-year history, projected to result in more than 2 million Californians losing health coverage, and up to 83 California hospitals – and untold numbers of clinics – are at-risk of closing or reducing life-saving care. Even without accounting for hospital closures, Yale University and University of Pennsylvania health researchers projected more than 51,000 preventable deaths each year would occur because of the federal cuts. Recent analysis by the UC Berkeley Labor Center and UCLA Center for Health Policy Research projected California’s health uninsured rate could double to 15% by 2030.
“Thanks to Assemblymember Ahrens’ leadership, this year's state budget includes $250 million to help keep public hospital systems open and life-saving services accessible to millions of Californians who need them,” said Katie Rodriguez, Interim President and CEO of the California Association of Public Hospitals and Health Systems. “This funding is a critical step, but a permanent solution to the financial fallout of H.R. 1 is still needed. Public hospital systems are on the front lines of a looming but preventable health care crisis: facility closures, fewer care choices, longer wait times, and higher costs we all pay. The decisions California’s leaders make now will determine how painful and deadly this crisis becomes.”
California’s public hospital systems, which include county-owned or affiliated systems - like Santa Clara Valley Healthcare (SCVH) - and five University of California academic medical centers, comprise just 8% of the state’s hospitals overall. Yet, they operate 67% of the state’s burn beds, 32% of psychiatric beds, and 15% of neonatal intensive care beds while training half of all new doctors in hospitals. Because of H.R. 1 cuts, public hospital systems could be forced to close facilities or cut life-saving services, restricting health care access for their 3.7 million patients, resulting in increased wait times, longer commutes for care, higher costs for everyone, and more preventable illness and even deaths.
Santa Clara County Supervisor Susan Ellenberg said, “We see the impact of these federal cuts every day — longer ER wait times, fewer providers, and residents being told their coverage has ended. Santa Clara County has done everything in our power to protect access to care: voters stepped up with Measure A, our hospital system identified hundreds of millions in efficiencies, and departments made deeper cuts to stretch every possible dollar. And now when our community and county needs further support, state legislators like Assemblymember Ahrens and Kalra are stepping up, because without continued state leadership this crisis will deepen and lives will be put at risk.”
SCVH operates 4 hospitals and 15 major health centers, including two of the three trauma centers and the only burn center in the region, and it is the largest public hospital system in Northern California and the second largest in the state. Every 11 minutes, someone is taken by 9-1-1 ambulance to a SCVH hospital, which provide care for nearly half of all ER visits and 80% of trauma cases in Santa Clara County. County-run healthcare facilities are lifelines for the community and our state that we cannot afford to lose.
“The $250 million in public hospital funding provided by the State legislature has played a critical role in bridging the funding gap this year to help maintain and support vital healthcare services in our community,” said Santa Clara Valley Healthcare Chief Executive Officer Paul E. Lorenz. “The County and our residents are grateful to Assembly Member Ahrens and the State legislature for their partnership and support in keeping high-quality healthcare available for everyone.”
Because of H.R. 1, the County of Santa Clara will lose more than $1 billion annually in federal funds, putting access to life-saving health care at risk. No single solution – other than the federal government restoring previous funding levels - can close a funding gap of this magnitude. The County is focused on three coordinated approaches to protect health care access and keep County-run public hospitals and clinics operating: using voter-approved Measure A funds responsibly, advocating for stronger State partnership, and streamlining operations to reduce costs.
“Santa Clara County has been out front in responding to unprecedented federal healthcare cuts, from the passage of Measure A last year to the leadership of Assemblymember Ahrens and our state delegation in securing critical funding for public hospitals in this year’s State budget,” said County Executive James R. Williams. “Yet even with these important steps, the County still faces a more than $1 billion annual shortfall as the impacts of H.R. 1 continue to unfold. Without sustained, long-term support from the State, public hospital systems like ours cannot maintain the critical, life-saving services our community depends on. We look forward to continuing our collaboration with State leaders to keep public hospitals and access to care a priority.”
In 2025, Santa Clara County voters approved Measure A to increase the local sales tax and establish a critical buffer against the most severe service cuts to our County-run healthcare system, including public hospitals and clinics that everyone depends on.
“Tens of thousands of public hospital frontline service providers across California are grateful Assemblymember Ahrens rallied state leaders to protect public hospitals in this year’s state budget,” said Riko Mendez, Chief Elected Officer of SEIU Local 521. "The fight isn’t over because the impacts of H.R. 1 are only just starting. The health of millions of Californians is on the line and the mission-driven care provided at public hospitals regardless of insurance status or ability to pay must be protected. Every single elected official in California must take this seriously.”
Dr. Joseph David Cooper, an Infectious Disease & HIV physician caring for patients at Santa Clara Valley Healthcare and Secretary for Valley Physicians Group (VPG), the County’s public employee doctors said, "On behalf of Valley Physicians Group, the union for publicly employed physicians, podiatrists and dentists of Santa Clara Valley Healthcare and the patients we serve, I want to commend Assemblymember Ahrens on his advocacy and perseverance in the fight for budget resources to protect public hospitals in California, and in Santa Clara County - allowing critical healthcare services to thrive and ultimately help keep our community healthy."
Assemblymember Patrick Ahrens represents the Silicon Valley in the California State Assembly for District 26. He is Chair of the Committee on Aging & Long-Term Care, and serves on the Committees on Budget, Business and Professions, Health, Transportation, and Budget Subcommittee No. 2 on Human Services. Assemblymember Ahrens is the Co-Chair of the California Legislative Technology & Innovation Caucus, and a member of the California Legislative Jewish and Bay Area Caucuses.
Source: Assemblymember Patrick Ahrens
