Proposed Federal Medicaid Cuts Harmful to Community Health and Local Economy

CenCal Health advocates to protect healthcare access for all on Central Coast

CenCal Health, the Medicaid managed care plan for Santa Barbara and San Luis Obispo counties, provides health insurance to over 242,000 low-income people on the Central Coast. Recent federal proposals to reduce Medicaid funding and constrict eligibility would negatively impact local hospitals, healthcare providers, businesses, and thousands of area residents.

Santa Maria resident Sara Macdonald knows firsthand what it means to have Medicaid health insurance. In California, Medicaid is called Medi-Cal. “As a low-income senior and a cancer survivor, my life has been extended and is more healthful because I am eligible for Medi-Cal and can see the local doctors I need to get and stay healthy,” says Macdonald, who volunteered to represent Santa Barbara County Medi-Cal members on the CenCal Health Board of Directors. “Because I don’t own a car, I walk or take the bus to get around Santa Maria. At ‘ground level’, I can really see the need for this safety-net program called Medicaid – for babies and school children from low-income families, neighbors with disabilities, seniors, and the unhoused. Our federal government must continue to show compassion for those who truly need assistance. We encourage all concerned to contact Congress in support of our local healthcare system and our most vulnerable residents.”

The health insurance provided by Medicaid plans like CenCal Health secures access to preventive care for children, pregnant women, the elderly, and disabled people, in addition to individuals who earn low wages. Preventive care leads to better health outcomes, keeps people out of the hospital, and supports a healthy workforce. Without health insurance, people defer care, often until it’s potentially life-threatening, which in turn puts a strain on hospitals, leading to avoidable poor health outcomes, and the delivery of healthcare services that go uncompensated.

For every government-funded dollar it receives, CenCal Health spends 93 cents to compensating local providers and hospitals for the medical benefits and services delivered to local health plan members. Federal changes that would decrease this funding and associated revenue streams to providers would impact the local health care delivery system and the local economy. Smaller medical provider groups may need to reduce hours or downsize, employers may need to purchase costly health insurance for their staff, and rural hospitals relying on Medicaid may need to reduce their services or, in extreme cases, close their doors.

In the 463-square-mile district that includes the city of Lompoc, Mission Hills, Mesa Oaks, Vandenberg Village, a portion of Vandenberg Space Force Base, and the area east toward Buellton, the Lompoc Valley Medical Center has served area residents since 1946. “The potential impact of any Medicaid cuts on rural communities remains a concern,” said Yvette Cope, CEO of Lompoc Valley Medical Center. “A reduction in these funds has the potential to limit the range of services we can provide now and, in the future, and could directly impact our ability to provide timely access to those requiring care. We must be able to provide high-quality care to all our residents, including emergency services, surgery, cancer treatment, and other essential healthcare services.”

Destabilizing the safety net by imposing new limitations on Medicaid funding and eligibility would be harmful to the San Luis Obispo and Santa Barbara communities. Medicaid not only supports those insured by the program, but also those hospitals, clinics and businesses – and their employees – that rely on Medicaid funding to sustain their healthcare services. 

“CenCal Health, together with leaders from local government, the healthcare profession and the business community, is advocating against Congressional cuts to Medicaid to protect healthcare on the Central Coast,” said Marina Owen, CenCal Health CEO. “Join us in asking policymakers to protect Medicaid funding. Our families, children and economy are counting on it.”

More information on CenCal Health is available at cencalhealth.org.

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About CenCal Health

CenCal Health is the local Medi-Cal health plan that partners with over 1,800 physicians, plus hospitals, clinics and other providers, in delivering high quality health care services to more than 242,000 members in its two-county service area – one in three residents of Santa Barbara County and one in four residents of San Luis Obispo County. Marking four decades of serving the most vulnerable, CenCal Health prioritizes cultivating community partnerships; advancing quality and health equity; expanding its service role and reach in the community; and organizing for impact and effectiveness. With a vision to be a trusted leader in advancing health equity so that the communities we serve thrive and achieve optimal health, CenCal Health invites the public to review its 2025 Community Report at CenCal2025.org

CenCal Health Contact: Citlaly Santos  (805) 685-9525 ext.9274   media@cencalhealth.org

Media Contact: Sheri Mobley  (213) 509-9816   sheri@seamlesspr.com

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