Key Takeaways
• California spends over $22 billion annually on migrant services, with $8.4 billion for Medi-Cal health benefits.
• New York City projects migrant-related costs to reach $12 billion by the end of fiscal year 2025.
• Governor Newsom proposes freezing Medi-Cal enrollment for undocumented adults starting January 2026 to address budget deficit.
California, New York, and New Jersey have become the focus of a growing discussion on how much states are paying for migrant costs. The arrival of large numbers of undocumented immigrants and asylum seekers is putting extra pressure on their budgets. As states try to provide basic services like health care and education for everyone, they face tough choices about where money should be spent.
Let’s look closer at what is happening in these states, how much they are paying, and what this might mean for people living there, including immigrants, local families, and policymakers.
California’s Growing Migrant Costs
California has always provided many public services to residents, even if someone is undocumented. But over the last few years, the state’s spending on benefits and services for undocumented immigrants has grown sharply. Reports show that California now spends more than $22 billion each year for things like:
- K-12 education for children
– Medical care, mainly through Medi-Cal (California’s Medicaid program) - Housing help
- Food and nutrition programs
- In-state tuition for undocumented students at public colleges
A large part of these costs comes from health care spending. In 2025, the state expects to pay more than $8.4 billion of taxpayer money so that undocumented immigrants can get Medi-Cal health benefits. This new spending is much more than what experts expected when the program was opened up in January 2024 to all low-income residents, regardless of their immigration status.
The expanding Medi-Cal program in California has been praised by some for giving health coverage to those who might otherwise go without. However, as more undocumented immigrants sign up, the costs to the state keep rising.
State Budget Problems
California is not only spending more on services—it is also running out of money. The state is facing a $12 billion deficit for the coming fiscal year, with even bigger budget gaps expected in the future. Governor Gavin Newsom, facing this financial squeeze, has proposed freezing enrollment in Medi-Cal for undocumented adults starting January 2026. If lawmakers go through with this plan, adults who are not already signed up by then would not be able to join.
Other suggestions include cutting long-term care coverage for certain groups and reducing money for safety-net programs that many immigrants rely on. For families, these changes could mean less access to medical care or social support if the budget is passed as it stands.
A summary from the California Assembly Budget Committee stressed that this expansion “is proving far costlier than originally projected and is already straining the Medi-Cal program that vulnerable Californians rely on.” This means that the programs could become less stable overall—not only for immigrants but for everyone who depends on Medi-Cal in California.
The state is now trying to find a balance between supporting newcomers and protecting benefits for people who have been in California longer, sometimes forcing uncomfortable cuts to social programs.
New York Faces a City-Level Crisis
New York is handling its own challenges, especially in New York City. Since spring 2022, about 100,000 asylum seekers have arrived in the city. The mayor’s office expects to spend more than $12 billion by the close of Fiscal Year 2025 to care for all these newcomers.
Breakdown of Recent Spending
During only a short period—from July 1 to late summer 2024—New York City spent about $308 million to help migrants. Over the last two years, the total cost is close to $5 billion, and if more people arrive, officials believe the city could spend twice as much next year.
The biggest migrant costs for New York include:
- Nearly $2 billion for shelter and rent
- About $2 billion for services and supplies, such as legal help and administrative work
- $500 million for food
- $500 million for medical expenses
New York’s laws require that everyone who needs shelter must be offered a bed. Because of this legal requirement, the city cannot refuse to provide housing, even when so many asylum seekers arrive at once. Meanwhile, social services like food and health care take up more of the city’s budget each year.
Worries for the Future
The size and speed of new arrivals are straining New York’s spending power. Officials are trying to slow down or limit spending in other areas. Still, the pressure of helping thousands of new arrivals is not expected to get easier anytime soon.
Some city leaders worry that the federal government is not helping enough. Yet, New York City must find the money for housing, food, health care, and emergency needs right away—even if it means cutting spending somewhere else.
New Jersey’s Annual Services Bill
While New York and California often get the most attention for their struggles with migrant costs, New Jersey is facing its own large bills. According to a May 2023 study, New Jersey spends about $7.3 billion every year to help its nearly 900,000 undocumented residents. These costs cover:
- Health care
- Public education
- Welfare-related services
- Criminal justice activities
Local governments in New Jersey are also feeling the pressure as more people turn to them for help. In a recent debate, the state considered giving $500 checks to certain tax filers who use an Individual Taxpayer Identification Number (ITIN). This ID is often used by people who don’t have a Social Security Number, including many immigrants. However, this proposal was not included in the most recent state budget as lawmakers worried about rising migrant costs and the overall popularity of new cash handouts.
Comparing the States
To better see the differences in spending, let’s compare the key numbers:
- California: About $22 billion each year on migrant-related services, with Medi-Cal health costs over $8.4 billion.
- New York: City crisis cost is $5 billion so far, but projected at $12 billion through 2025, focused mainly on shelter, food, and medical needs.
- New Jersey: $7.3 billion every year, across many state and local support programs.
The costs are split across health care (especially Medicaid programs like Medi-Cal), public education, housing assistance, and social services. While all three states are under stress, California’s spending is the highest. This is matched by some of the country’s most generous welfare and health access rules for people regardless of legal status.
California’s budget plan, which includes limits or freezes on Medi-Cal for undocumented adults, represents a new turning point in how far the state is willing to go in covering newcomers’ needs considering the overall funding shortfall.
Who’s Paying the Price?
These rising migrant costs are causing concern across many groups. State and local governments have to decide whether to cut other important programs, such as support for children, seniors, or low-income families, to keep services for immigrants going. Immigrants themselves, especially those who came for safety or a new start, are worried that promised programs could end or change.
There is a political battle as well, as lawmakers weigh competing ideas:
- Should states cut support for undocumented immigrants to help close gaps in education or health funding for everyone?
- Should the federal government pay more of the bill since border and immigration are mostly national responsibilities?
- How can states keep healthy budgets while still acting with compassion?
Leaders in some areas have noted that although immigrants do contribute tax dollars (for example, about $31 billion each year nationally), at this time their use of Medicaid and other social programs is costing states more than those contributions cover.
Governor Newsom in California, for instance, pointed out that freezes on new benefits—in particular, Medi-Cal for undocumented adults—are directly tied to the state’s growing deficit. These choices are painful but viewed by some as needed to protect existing safety nets for the most vulnerable residents.
The Medicaid Question: What Changes Could Mean for Families
Medicaid, known as Medi-Cal in California, is often the single biggest source of health care for lower-income families. Expanding Medicaid to include undocumented immigrants has been controversial because even small changes can affect millions of people.
For immigrants, having access to Medicaid means they are less likely to avoid hospitals or doctors out of fear of costs or deportation. For everyone else, the rising cost of these programs may mean cuts to other health areas, longer waits for care, or even higher taxes in the future.
California’s plan to freeze Medi-Cal for undocumented adults is a warning to other states thinking about similar moves. According to reports, the rapid growth in enrollment is making it hard for the state to keep up. Local lawmakers argue that the system works best when everyone—including immigrants—can get care. Opponents claim the unlimited expansion is too expensive and unsustainable.
According to the Centers for Medicare & Medicaid Services, Medicaid is designed for those with limited resources, but every state has some control over who gets covered. California’s choices in the coming months could set a major example for how other states handle these tough decisions.
Political Tension Over Responsibility
Blue-state leaders have often said they are committed to helping immigrants, yet the strain on local budgets is causing some to rethink those promises. The question is not only about money but about values and responsibility.
Some leaders say the federal government should pay more because national policy about the border and asylum affects who arrives in states like California, New York, and New Jersey. While some federal dollars do go to these states, they say it covers only a small part of total spending. As a result, more states are considering slowing or cutting back on programs to undocumented immigrants, hoping to close budget holes.
Locally, there is also tension among voters—some who support aid for newcomers and others who think charity at home should come first. Lawmakers must weigh what is best: keeping budgets balanced or keeping their doors wide open.
What’s Next for California, New York, and New Jersey?
The future will depend on several things:
- How many more migrants arrive in the next year or two
- Whether the federal government gives more support to cover state and city bills
- Which programs state leaders decide to protect, freeze, or cut
- How local voters respond if cuts hit communities hard
Right now, the trend in all three states is clear: without new money, programs for undocumented immigrants—especially costly ones like Medicaid/Medi-Cal—are most at risk for cuts or freezes. As reported by VisaVerge.com, these choices will shape not just the future of immigrants but also the strength of social services for everyone living in these states.
What Should Residents and Immigrants Do?
If you are living in California, New York, or New Jersey and rely on programs like Medicaid/Medi-Cal, it’s important to keep up with budget changes in your state. These changes could affect health coverage, education, and housing help.
Residents can check their state or local government websites for updates on benefits and available help. For the latest information about Medicaid eligibility or changes, you can visit the official Medicaid website.
Lawmakers are listening carefully to feedback from the public, so sharing your thoughts can also make a difference.
Summary
Migrant costs are shaping policy across California, New York, and New Jersey in new and important ways. The pressures on budgets are leading all three states to think hard about spending, with Medicaid and other key programs facing possible cuts or freezes. For both immigrants and longtime residents, these choices will likely influence the quality and amount of help states can offer in the future. Now, more than ever, understanding these decisions—and the numbers behind them—matters for all who call these places home.
Learn Today
Medi-Cal → California’s version of Medicaid, providing health care coverage to low-income residents regardless of immigration status since 2024.
Deficit → When government spending exceeds collected revenue, causing financial shortfalls that may require service cuts or new funding.
Undocumented Immigrants → People residing in a country without official legal authorization or documentation.
Asylum Seekers → Individuals who flee their home country and request international protection due to danger or persecution.
Individual Taxpayer Identification Number (ITIN) → A tax processing number for individuals, including immigrants, who do not qualify for a Social Security Number.
This Article in a Nutshell
California, New York, and New Jersey face rising migrant costs, straining budgets and leading to tough policy decisions. Medicaid expansions, especially California’s Medi-Cal, drive expenses. With deficits mounting, states debate freezing benefits for undocumented immigrants, potentially impacting services for all. These fiscal choices will shape immigrant and resident support across key programs.
— By VisaVerge.com
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