As states such as California brace for steep cuts, the more than 400 hospitals statewide have already laid off more than 3,400 health care workers as of mid-March,<\/a> with as many as 1,600 coming from Santa Barbara to Orange County and the Inland Empire area, according to a tally of layoffs provided by the state\u2019s Employment Development Department and data collected by Paul Young, senior vice president of public policy and reimbursement with the California Hospital Association of Southern California.<\/p>\n \u201cWhat I see happening in health care is a shifting of the workforce, meaning that a lot of the positions that you see eliminated are much, much less those on the clinical side with most in the administrative areas,\u201d said Annette Walker, president of City of Hope Orange County. \u201cWe\u2019re trying to minimize any impact that might touch the patient.\u201d<\/p>\n Last September, Duarte-based City of Hope, one of the largest cancer care networks in the United States, announced it would lay off roughly 200 workers<\/a> \u2014 or 1.3% of the nonprofit\u2019s total workforce of 15,000 people \u2014 in an alignment with \u201cstrategic priorities.\u201d The cuts hit the cancer care provider\u2019s business support and operations teams across all levels, including management.<\/p>\n No staff reductions occurred at City of Hope Orange County, which recently opened a comprehensive cancer care center<\/a> and hired 600 workers.<\/p>\n \u201cLike almost all jobs we recruited, those are clinical people, nurses, people who are going to work in the hospital and help support the clinical function, as opposed to people like me, who has an administrative job,\u201d she said. \u201cNobody\u2019s healed because of what I do. I facilitate systems for those people. So when you look at the layoffs across the industry, you\u2019re going to see most of them are not going to be in the clinical areas. \u201c<\/p>\n Some analysts see more cuts coming as HR 1 is rolled out in coming years.<\/p>\n \u201cThe impact of cuts hasn\u2019t really hit us yet, since certain hospitals are basically preplanning for more pending cuts from the legislation (HR 1) that impacts Medi-Cal more greatly in 2027,\u201d said Young, who estimates that 48% of hospitals in California are already operating in the red and face a fiscal cliff due in part to labor shortages during the pandemic.<\/p>\n The UC Berkeley Labor Center<\/a> estimates the Medi-Cal cuts could lead to a loss of 72,000 to 145,000 health care jobs throughout California, representing 3% to 5% of the state\u2019s 2.65 million health care positions. These job losses include positions in hospitals, clinics and home care.<\/p>\n \u201cHR 1 is going to have serious consequences for our health care system,\u201d said Kristof Stremikis, director of market analysis and insight with the California Health Care Foundation, an Oakland-based nonprofit that works to improve the health care system for poor people.\u00a0 \u201cAt the end of the day, this is about $30 billion in federal cuts to our health care system in California every year, once we\u2019re sort of fully phased in by 2028. Within the next couple of years, we\u2019re staring down about a 20% to 25% reduction in federal funding.\u201d<\/p>\n Stremikis said that the full impact of the federal cuts \u2014 from a low of $25 billion estimated by the Rand Corp.<\/a> to a high of $30 billion by the state\u2019s Health and Human Services Agency<\/a> \u2014 won\u2019t fully hit the system for another year or two.<\/p>\n \u201cWhen you\u2019re talking about a reduction of this size, that\u2019s going to have very serious consequences for any organization that takes care of medical enrollees,\u201d Stremikis said. \u201cThey\u2019re going to be needing to make very difficult decisions, operational decisions, about what services they offer and the size of their workforce. It\u2019s just math. These are pretty significant federal financial cuts, and California is in no position to make that up with state revenue.\u201d<\/p>\n Revenue losses<\/p>\n There are several buckets of potential revenue losses, but one of the largest may be the one involving undocumented immigrants.<\/p>\n For instance, Young said, the state froze new enrollment in Medi-Cal of undocumented California adults<\/a>, effective Jan. 1. Young cited a new requirement of HR 1 that says the \u201cunsatisfactory immigration status\u201d population \u2014 or undocumented workers \u2014 will need to recertify for benefits with the state every six months, beginning in 2027.<\/p>\n That process has effectively scared many people away from filling out paperwork to recertify with Medi-Cal due to fears of being outed by the federal government, which is cracking down on undocumented immigrants by apprehending and deporting them.<\/p>\n The state\u2019s Medi-Cal program covers more than 15 million lower-income residents, including 1.6 million undocumented immigrants. The estimates are far from precise, but 289,000 Medi-Cal members may lose coverage by June , rising to 400,000 by 2029-2030, according to the Department of Health Care Services<\/a>, the state\u2019s health care agency that administers Medi-Cal for more than a third of Californians.<\/p>\n Keeping a close eye on the undocumented immigrant population, which Medi-Cal began doing\u00a0in 2024,<\/a> is challenging as funding shrinks and expenses continue to rise for such organizations as Orange-based CalOptima Health, a county-organized health system that manages programs funded by the state and federal governments, and L.A. Care Health Plan, the nation\u2019s largest publicly operated health plan.<\/p>\n Also see: CalOptima reports steep membership drop as providers brace for suge in uninsured patients.<\/a><\/p>\n While CalOptima has kept steady at 1,645 full-time workers over the past three years, the organization has hired conservatively and not filled some positions in order to keep pace with a shrinking membership base, said Michael Hunn, chief executive officer of CalOptima, in an interview.<\/p>\n \u201cAt this time, even with all of the changes in funding, we are not looking to do any staff layoffs or reductions in force,\u201d Hunn said.<\/p>\n CalOptima has about 819,000 members, down 8% from 886,000 in July 2025<\/a> when HR 1 became law, and when the organization began to see a sharp decline. Hunn said roughly 134,000 of CalOptima\u2019s members are classified as undocumented immigrants. Over the past year, an estimated 20,000 undocumented members became ineligible to enroll with CalOptima, according to Hunn.<\/p>\n \u201cIt\u2019s hard for us to determine exactly what\u2019s going to happen,\u201d Hunn said. \u201cWe are are going to be watching this trend very carefully as some of the new rules go into effect in January.\u201d<\/p>\n More cuts coming?<\/p>\n The story is different at\u00a0L.A. Care Health Plan, <\/a>which earlier this month laid off 225 workers, or 3% of its workforce of 7,500. More cuts may be coming.<\/p>\n The health organization, which is the largest health plan in Los Angeles County serving about more than 1 of every 4 people in the county, 25.5% of the county\u2019s 9.8 million people.<\/p>\n In a statement issued to the Southern California News Group, Martha Santana-Chin, chief executive officer of the plan, said the layoffs were driven by federal and state Medi-Cal budget cuts and an \u201corganizational restructuring.\u201d She declined to elaborate.<\/p>\n \u201cThis restructuring is intended to strengthen critical capabilities and position us for the future,\u201d Santana-Chin said. \u201cBy the end of 2028, we project losing up to 650,000 members \u2014 this is almost a 30% drop in enrollment,\u201d wrote Santana-Chin, noting that it currently has 2.5 million members.<\/p>\n \u201cUnfortunately, these cuts will not only impact those covered by Medi-Cal,\u201d she added. \u201cThey also will impact individuals who purchase coverage through our state\u2019s marketplace, Covered California, those who have private insurance, and those who have employer provided health plans. When individuals lose health coverage, they stop using preventive care and end up in emergency rooms, incurring higher costs that they can\u2019t afford to pay. \u201c<\/p>\n Covered California is the state\u2019s official health insurance marketplace under the Affordable Care Act, also known as Obamacare.<\/p>\n Ripple effects<\/p>\n The ripple effects of the funding cuts have hit every part of the state.<\/p>\n In rural areas, Palo Verde Hospital in\u00a0Blythe filed for bankruptcy in September\u00a0<\/a>\u00a0\u2014\u00a0laying off nearly 100 <\/a>\u2014 Oroville Hospital and its parent, OroHealth,\u00a0filed for bankruptcy in December<\/a>,\u00a0and\u00a0Southern Inyo Hospital<\/a>\u00a0in Lone Pine sought emergency funds to keep it going.<\/p>\n In the Bay area, a plan to lay off 183 workers at Alameda Health System<\/a>\u00a0was delayed while the\u00a0Alameda County Board of Supervisors formed a working group<\/a> to close a $91.7 million deficit and save the hospital, and Lucile Salter Packard Children\u2019s Hospital<\/a> in Palo Alto announced plans to lay off 87 in December.<\/p>\n In August, Roseville-based Adventist Health underwent a restructuring to address a $244 million operating loss and cut 296 jobs<\/a>.<\/p>\n Cuts in Los Angeles\u2013area hospitals and health organizations also aren\u2019t immune \u2014 the region accounts for most of California\u2019s layoffs to date.<\/p>\n Last October, Children\u2019s Hospital of Los Angeles<\/a>\u00a0laid off 439<\/a>,\u00a0Kaiser Permanente laid off 216 workers<\/a> across Southern California, including some in Corona, while the University of Southern California cut 259 jobs<\/a>\u00a0to tackle a rising operating deficit of more than $230 million.<\/p>\n About 151 of those job cuts occurred on the USC Health Sciences Campus, including several at the Keck School of Medicine, which includes a teaching hospital, specialized cancer hospital, community hospitals and outpatient clinics throughout Southern California, and the USC Norris Comprehensive Cancer Center.<\/p>\n Planned Parenthood of Orange and San Bernardino Counties<\/a>, which was forced to close its primary care practice Melody Health in October, laid off 81 staff members.<\/p>\n The organization said it was making \u201ccuts as a direct result of the Trump administration unjustly defunding Planned Parenthood,\u201d and blocking it from receiving federal Medicaid funds.<\/p>\n![\"A](\"https:\/\/www.newsbeep.com\/us-ca\/wp-content\/uploads\/2026\/03\/1774734248_228_LDN-L-HOSPITALS-TROUBLE-03xx-03-SR.jpg\")
A person uses Children\u2019s Hospital Los Angeles\u2019 bridge over Sunset Boulevard on Friday, March 20, 2026. California hospitals including Children\u2019s Hospital are facing healthcare cuts in the form of layoffs as a result of the \u201cOne Big Beautiful Bill Act.\u201d (Photo by Sarah Reingewirtz, Los Angeles Daily News\/SCNG)
\nFiscal cliff<\/p>\n![\"CalOptima](\"https:\/\/www.newsbeep.com\/us-ca\/wp-content\/uploads\/2026\/03\/1774734248_363_OCR-L-HOSPITALS-TROUBLE-03xx-26.jpg\")
CalOptima currently has about 819,000 members, down 8% from 886,000 in July 2025 when H.R. 1 became law, and when the organization began to see a sharp decline. (Photo by Leonard Ortiz, Orange County Register\/SCNG)<\/p>\n![\"Above,](\"https:\/\/www.newsbeep.com\/us-ca\/wp-content\/uploads\/2026\/03\/1774734249_52_OCR-L-PP-MELODY-CUTS-1014-two-01_1098686684.jpg\")
Above, a patient has her blood pressure taken at a health clinic run by Anaheim-based Planned Parenthood of Orange and San Bernardino counties, which announced in Oct. 2025, that it laid off 81 people as it shuttered Melody Health, its primary care practice. (Courtesy of Planned Parenthood)<\/p>\n