Story perspectives

Newsom Backs Medi-Cal Tax, Insurers Warn $100 Premiums

By Drooid · Oct 11, 2026, 3:41 PM UTC · How we work

Summary

Story summary

Governor Gavin Newsom backed a revised health-plan tax to fund Medi-Cal.
The tax would raise private health-plan levies starting in 2027 if approved.
Insurers warn premiums could increase $100 per person or $400 per family.
Doctors and insurers sued alleging the measure violates Proposition 35’s tax caps.
California’s borrowing rose from $3.4 billion in March 2025 to $4.4 billion, repayable over ten years.

History

Historical Context

President Barack Obama signed the Affordable Care Act on March 23 2010, creating a federal insurer excise tax projected to raise up to $14.3 billion a year. The law’s insurer levy inspired Governor Gavin Newsom’s 2027 California health-plan tax proposal, which now faces lawsuits from insurers and doctors over its impact on premiums.

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Story summary

Governor Gavin Newsom backed a revised health-plan tax to fund Medi-Cal.
The tax would raise private health-plan levies starting in 2027 if approved.
Insurers warn premiums could increase $100 per person or $400 per family.
Doctors and insurers sued alleging the measure violates Proposition 35’s tax caps.
California’s borrowing rose from $3.4 billion in March 2025 to $4.4 billion, repayable over ten years.

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