What cuts to Medi-Cal youth gender-affirming care could mean for California's budget

California has been preparing to fill a budget gap for gender-affirming care procedures after the federal government pulled the funds under the direction of President Donald Trump and Mehmet Oz, administrator of the Centers for Medicare & Medicaid Services.

LAist crunched the numbers to see if the state has budgeted enough, and here’s what we found.

Youth on Medi-Cal bill $1 million yearly for hormones

People under 18 covered by Medi-Cal filed about $1 million in claims in 2025 for hormone replacement therapy and puberty blockers, according to data from California’s Department of Health Care Services. That accounted for about 4,000 claims.

Some providers that take trans youth patients on Medi-Cal, like Children’s Hospital Los Angeles’ trans youth clinic, closed last year, though many doctors still were able to write out prescriptions that lasted patients for months after that.

Some care remains covered 

Medi-Cal also covered 4,800 claims for about 1,500 Medi-Cal members under 18 in 2025 for “doctor visits, counseling, surgeries, speech therapy, and other services,” totaling $6.4 million. Gender-affirming surgeries are only recommended for minors in rare circumstances.

However, the restrictions in the federal Medicaid rule only affect puberty blockers, hormone replacement therapy and surgeries, according to health policy organization KFF, so services like mental health treatment would still be reimbursable with federal funds. The rule, which would take effect Oct. 13, also lets states pay for minors’ gender-affirming hormone treatments and surgeries themselves.

The state has already set aside two pots of money to close gaps in funding for gender-affirming healthcare services: a $30 million fund for uncompensated gender-affirming care and abortion services, and a $26 million trust fund specifically for trans healthcare.

While these funds were not established with the intent to backfill Medi-Cal provider reimbursements for trans youth care, California Health & Human Services Agency leaders have said they "are committed to ensuring all people have access to the medically necessary, evidence-based care that will allow them not only to survive, but thrive."

Advocates call for more state funding

In order to protect the previously approved funds from being redirected, advocates are calling on state lawmakers to set aside an additional $10 million in funding to ensure trans youth on Medi-Cal don't have any gaps in healthcare while officials come up with a permanent solution.

"California has made a commitment that transgender people will not be denied medically necessary health care because of who they are," Jennifer Chou, health policy director at LA LGBT Center, said in a statement. "Now is the moment to make sure that commitment means something."

Medi-Cal’s budget

The overall Medi-Cal program budget during this period was almost $200 billion, according to state data. Transgender youth health services, including mental health services, make up just 0.004% of the plan’s budget.

Medi-Cal administers both the federal Medicaid program and the Children’s Health Insurance Program (CHIP) under a Medicaid expansion allowed for by the Affordable Care Act.

“The federal rule applies solely to federal Medicaid and CHIP funding; California will determine any adjustments needed to align with federal requirements,” California Department of Health Care Services spokesperson Anthony Cava said in a statement. “California remains committed to safeguarding access to medically necessary care for Medi-Cal members, including gender-affirming care.”

Medi-Cal agencies like L.A. Care have stated that they are continuing to cover gender-affirming care services.

Issues may still arise

Trans healthcare advocates have noted that some issues may arise due to providers who are unsure how the new rules apply.

The California Legislative LGBTQ Caucus has also said it’s bracing for future budget years to be “even more challenging as federal funding cuts and attacks on targeted investments to marginalized communities continue to threaten critical services.”

Meanwhile, California Attorney General Rob Bonta has denounced the restrictions on federal funding since they were first floated last year. A lawsuit has not yet been announced, but a spokesperson for his office told LAist, “We are closely reviewing the final rule.”