The announcement has sparked debate over the program's expansion to include undocumented immigrants, with some Republicans calling for cuts while the governor's office cites broader factors for the financial strain. Assembly Member Carl DeMaio, a Republican, argues that the loan is "only the beginning" of Medi-Cal's financial troubles. "This is only the first of many loans that will have to be made if we continue to give free taxpayer funded handouts for health care to illegal immigrants," DeMaio told CBS 8.

He said the program has been pushed "to the brink of bankruptcy" and is calling on Governor Gavin Newsom to suspend Medi-Cal coverage for undocumented immigrants.