Medicaid is the largest source of revenue for the Santa Clara Valley Healthcare system.
U.S. President Donald Trump, joined by Republican lawmakers, signs the One, Big Beautiful Bill Act into law during an Independence Day military family picnic on the South Lawn of the White House on July 04, 2025 in Washington, DC. After weeks of negotiations with Republican holdouts Congress passed the One, Big Beautiful Bill Act into law, President Trump’s signature tax and spending bill. The bill makes permanent President Donald Trump’s 2017 tax cuts, increase spending on defense and immigration enforcement and temporarily cut taxes on tips, while cutting funding for Medicaid, food assistance and other social safety net programs. (Photo by Samuel Corum/Getty Images)
Medicaid is the largest source of revenue for the Santa Clara Valley Healthcare system.
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Santa Clara County officials fear that Republicans’ “big, beautiful bill” will rip a “seismic tear” in the country’s social safety net as they brace for more than $1 billion in lost federal revenues locally over the next few years.
On July 4, President Donald Trump signed his massive landmark bill into law, putting into motion sweeping tax breaks and some of the largest cuts in history to food assistance and public health insurance programs.
For months, county leaders have tried to prepare for Trump’s federal spending cuts, replacing nearly $60 million of federal funds with local dollars for housing, public health and behavioral health services in its recently adopted $13.7 billion budget. But the passage of House Resolution 1 will now create “an unprecedented fiscal situation for the county,” County Executive James Williams said.
Medicaid — a federally funded public health insurance program that’s known as Medi-Cal in California — is one of the critical services facing cutbacks to the tune of $1 trillion over the next decade. New work requirements to access Medicaid have also been imposed, and more than 12 million people nationwide and roughly 3.4 million California residents are expected to lose their insurance as a result.
In Santa Clara County, one in four residents are on Medi-Cal, and Medicaid makes up the largest source of revenue for the Santa Clara Valley Healthcare system — the second largest county-owned health and hospital system in the state.
At a press conference on Thursday afternoon, Santa Clara Valley Healthcare CEO Paul Lorenz said that reduced federal revenues from Medicaid will impact more than just the individuals who rely on the public health insurance program, which is for low-income individuals.
“Without access to preventative health care, people will turn to the emergency rooms when they are sick and in crisis,” he said. “This results in increased costs, delays in patient care, longer wait times and ultimately it will impact the lives of individuals in our community, our friends and our family members.”
Supervisor Betty Duong called the tax cut bill “cruel,” “insidious” and “nothing short of a death sentence for so many in our community.”
“When emergency rooms are flooded, when our ambulances are tied up and there are none left available, we will all pay as a society,” she said. “We’re not just going to pay now, we’re going to pay for generations to come for what this bill is going to do to undermine the health of our community.”
The Supplemental Nutrition Assistance Program, which provides food benefits for more than 42 million Americans, will also face sharp cutbacks and have new work requirements for eligibility. In California, roughly 5.4 million residents rely on SNAP, called CalFresh locally, including 1.5 million children and nearly 1.1 million seniors.
Bay Area food banks have been sounding the alarm that cutting SNAP could result in the loss of 9.5 billion meals per year nationwide and strain already overwhelmed hunger-relief efforts.
Williams on Thursday called on the state to step up. While he acknowledged that California, which has had its own fiscal challenges this year, can’t fully fill the gap, he wants them to “soften the edges, to mitigate rather than exacerbate those cuts.”
“Public hospitals in California make up only 6% of the state’s hospitals,” Williams said. “But public hospitals like ours represent over 50% of the trauma and burn centers in the state and train over 50% of doctors in California. We are the backbone for that critical care across California.”