“Canary in the coal mine” closures are harbinger of more to come — voters can pass billionaire tax in November to backfill cuts that threaten care
LOS ANGELES, CA – California’s health care system is facing a growing crisis as hospitals lay off thousands of workers and brace for even deeper cuts, according to new reporting by the OC Register. More than 400 hospitals statewide have already laid off more than 3,400 health care workers as of mid-March. The wave of layoffs comes after billions of dollars in federal and state health care funding have been slashed, pushing nearly half of hospitals statewide into financial distress.
To counteract cuts, a growing list of organizations and lawmakers are supporting the California Billionaire Tax Act, a one-time 5% emergency tax on the state’s roughly 200 billionaires as a direct response. The commonsense measure is designed to ensure that billionaires pay their fair share to stabilize and protect the state’s vast healthcare infrastructure, including California hospitals, nursing homes, community health centers, and home care services.
Over the past year, hospitals across California have eliminated thousands of jobs, with particularly heavy losses concentrated in Southern California. Health systems in regions spanning Santa Barbara, Orange County, and the Inland Empire have already reported significant workforce reductions, while major providers, including community hospitals, health plans, and nonprofit systems, continue to scale back operations to stay afloat.
Experts warn this is only the beginning. Hospital leaders are now signaling a second wave of layoffs as funding cuts tied to recent federal policy changes are phased in over the next several years. These cuts are expected to reduce federal health care funding in California by as much as $30 billion annually by 2028, forcing hospitals to make difficult decisions about staffing, services, and patient care.
“This is a direct threat to patient care across California,” said Suzanne Jimenez, Chief of Staff at SEIU United Healthcare Workers West (SEIU-UHW), lead sponsor of the California Billionaire Tax ballot measure. “When hospitals lose funding, they lose staff. And when they lose staff, patients face longer wait times, fewer services, and reduced access to lifesaving care. Without urgent action, communities across California will lose access to the care they depend on.”
While many hospital systems have attempted to shield frontline clinical staff by targeting administrative roles for cuts, the scale of the funding reductions is making it increasingly difficult to avoid broader impacts. Some facilities, including Pomona Valley Hospital Medical Center, have announced plans to lay off hundreds of workers due to significant budget shortfalls, raising concerns that deeper cuts to services and staffing may be unavoidable without voter intervention.
The consequences are already being felt across the system. Health organizations have implemented layoffs, hiring freezes, and program closures, while some providers have been forced to shut down entire service lines. Safety-net providers serving low-income communities are among the hardest hit, as reductions to Medi-Cal and declining enrollment further strain already fragile budgets.
Statewide, projections show the cuts could result in the loss of up to 145,000 health care jobs, impacting hospitals, clinics, and home care providers alike. At the same time, hundreds of thousands of Californians are expected to lose health coverage in the coming years, increasing reliance on emergency care and driving up uncompensated costs for hospitals.
“Every day I come to work thinking about my patients, making sure they get the care they need, that they feel safe, that they’re not alone. Now, I’m also thinking about whether I’ll still have a job next month,” said Mayra Castaneda, an ultrasound technologist at a hospital in Lynwood, CA. “We’re already stretched thin, and the idea that more staff could be cut is terrifying. It doesn’t just impact us as staff. It impacts every patient who walks through our doors. You can’t keep taking resources out of health care and expect people not to suffer.”
Without revenue from the California Billionaire Tax, federal healthcare cuts will force hospitals and ERs to close. Healthcare costs will increase and insurance premiums will skyrocket. All Californians will feel the effects of these cuts, but they will hit seniors, children, veterans, and people with disabilities especially hard.
Measures such as the Massachusetts Fair Share Amendment and Washington State’s capital gains tax have generated billions in new revenue for public services, and the number of high-income residents AND their cumulative wealth in both states have increased since the policies went into effect.
In addition, tax experts have underscored that what makes the billionaire tax unique is how it’s designed to be fair and enforceable — so billionaires can’t avoid responsibility by moving their assets or claiming residency elsewhere after the now-passed January 1, 2026 deadline for residency changes.
The Billionaire Tax ballot measure will give Californians the opportunity to vote “yes” to save their healthcare, with 90% of funds raised going toward stabilizing the state’s healthcare system and protecting healthcare for all Californians, and 10% funding food aid and supporting K-14 public education.
Impact of federal healthcare cuts
- Dozens of hospitals and ERs will close; dozens more will be forced to cut back services and lay off healthcare workers. The patient care crisis will worsen as patients are forced to wait longer and drive further for medical care.
- Up to 3.4 million Californians could lose their healthcare coverage under Medicaid, including many seniors, children, veterans, and people with disabilities
- The state could lose about $30 billion in federal healthcare funding every year — destabilizing the health care system and driving up health care costs for everyone.
- Insurance premiums for Californians who purchase Affordable Care Act plans could rise as much as 97%, and an estimated 400,000 Californians could be priced out of healthcare altogether.
Impact of food assistance cuts
- Currently, 5.5 million Californians benefit from food aid. 3.5 million are senior citizens and children.
- At least 754,000 people could lose their entire monthly benefit, with over 3 million households facing reductions.
- The estimated funding loss is $2.5 to $4.5 billion annually.
The SNAP/Cal-Fresh cuts, if not backfilled by other funding mechanisms, are expected to cost California approximately 400,000 jobs over the next nine years.
About the California Billionaire Tax Act
The California Billionaire Tax Act proposes a one-time emergency tax on the wealth of the state’s ultra-high-net-worth individuals to safeguard Medi-Cal, keep hospitals and emergency rooms open, expand food assistance, and support public education. The initiative is a direct response to federal healthcare cuts under HR1 that threaten healthcare access and economic stability for millions of Californians.
| Paid for by Save California Health Care and Public Education, Sponsored by Service Employees International Union – United Healthcare Workers West. Committee’s Top Funder Service Employees International Union – United Healthcare Workers West |
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