Insurance Commissioner Ricardo Lara has initiated the first comprehensive study examining the fiscal and economic impacts of expanding Medi-Cal and Covered California coverage to undocumented Californians. The research, commissioned by the School of Public Health at San Diego State University (SDSU), aims to deliver independent, data-driven insights into the costs, savings, and economic outcomes of these healthcare expansions.
Purpose and Scope of the Study
The study will quantify and analyze the financial impacts of extending healthcare access by:
- Evaluating how expanded access affects healthcare utilization, spending, financing, and labor market outcomes in California.
- Providing policymakers with essential insights into net fiscal impacts—whether cost-saving, cost-neutral, or more costly in the short and long term—for individuals, employers, and the state.
- Informing future healthcare policy discussions with evidence-based findings.
Commissioner Lara emphasized the importance of factual, nonpartisan data to guide decision-making. “By partnering with one of our leading public research universities, this independent study will be vital for fiscal decision-making in Sacramento, especially as vulnerable communities often face cuts during budget crises,” Lara said. “Rather than avoiding this issue, I want to confront it directly with real answers, not rhetoric, to guide policymakers and the next governor with factual data for informed decision-making.”
Research Leadership and Approach
The California Department of Insurance selected SDSU’s School of Public Health within the College of Health and Human Services to lead the study, citing its expertise in public health, healthcare policy, and advanced economic modeling. The school has a strong record of producing research that translates into actionable policy recommendations.
“This study offers an important opportunity to understand how California’s expanded access to care has shaped the lives of residents and the state’s health system,” said Wilton Choi, assistant professor of health economics at SDSU and principal investigator of the study. “Our goal is to provide a clear, evidence-based picture that can help inform future decisions and policy discussions at the legislative level.”
Methodology and Timeline
The SDSU research team will use advanced modeling and data integration methods—including tax simulation and economic impact models—commonly unavailable to legislative or budget offices. These techniques will help assess how expanded healthcare coverage affects state and local economies, healthcare spending, and household finances.
The study marks the first detailed evaluation of California’s Medi-Cal expansions that cover all income-qualified residents, regardless of immigration status. It will provide empirical assessments of coverage changes, costs, healthcare utilization, financing, payments, and labor market effects since the phased expansion began in 2016.
The results will serve as a neutral foundation for understanding the fiscal and economic impacts of these policies and guide future decisions on healthcare access and financing in California. Work on the study will begin this year, with completion anticipated in 2027.
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