SAN FRANCISCO, USA – For the past 10 years, Karen Sanchez has been working in the outpatient laboratory of a hospital in rural Los Angeles County’s Antelope Valley, seeing S., a 30-year-old man with Down syndrome, every few months.
Mr. S, who arrived with his official caretaker, smiled when he saw the now familiar purple-haired Mr. Sanchez waiting in the lobby. She ushered him in for blood tests, but they didn’t see each other for several months after that.
Recommended stories
list of 4 itemsend of list
Sanchez said she stays up late thinking about S. and other patients with complex medical conditions, many of whom she has seen since they were children. President Donald Trump’s One Big Beautiful Bill Act (OBBBA), passed in July 2025, would require Mr. S. and others like him to fill out forms every six months to determine their eligibility for Medi-Cal, California’s version of the federally funded health care program known as Medicaid.
This is a complex task for patients like S., whose name has been withheld to protect patient privacy.
“It’s difficult for him to even understand the changes,” Sanchez said.
OBBBA sought to save $100 billion in costs by asking patients to fill out eligibility forms more frequently, increasing work requirements to maintain insurance for those who can work, and eliminating those who are ineligible.
“He doesn’t understand why he has to fill out forms so often,” Sanchez said of S.. For now, he has a caregiver, but under the new system, “patients like him could fall through the cracks,” he said.
Sanchez is part of the California chapter of the Service Workers International Union for Health Care Workers (SEIU-UHW), which is proposing a millionaire tax, a one-time 5% tax on people with more than $1 billion in assets, to make up for lost money from federal layoffs.
Democratic Sen. Bernie Sanders of Vermont plans to launch a campaign to gather 875,000 signatures at a rally in Los Angeles on Wednesday night so Californians can vote on the tax in November’s midterm elections. If passed, it would be retroactive to January 1 for anyone living in the state at the time.
The proposed tax has already sharply divided the state.
Google co-founders Larry Page and Sergey Brin reportedly bought a house in Florida and moved some companies in an effort to change their tax status.
“This is not a tax on billionaires. This is a tax on California’s economy,” said Patrick Cullerman, vice president of the Bay Area Council, a San Francisco-based business group.
“This $100 billion tax increase is a tax that no one can afford because it will not only rob California’s most successful entrepreneurs, it will weaken the entire economic ecosystem that supports jobs, investment, wages, and public services for everyday Californians,” California Business Roundtable President Rob Lapsley said in a statement ahead of Sanders’ rally.
California is the world’s fourth-largest economy, thanks to the Bay Area’s tech giants. If a tech billionaire leaves the country, it could destabilize the state’s finances.
Gov. Gavin Newsom, who recently announced a nearly $3 billion budget deficit due in part to federal funding cuts, has already distanced himself from voting measures.
He told Bloomberg News that billionaires shouldn’t move out of state because of the tax, which is unlikely to pass.
Cullerman of the Bay Area Council said California should avoid policies that “may unintentionally discourage investment or make it difficult for employers to expand here.”
But even as Sanders begins his statewide campaign this week, Sanchez is already spending most evenings after work at a nearby brewery collecting the signatures needed by the end of April deadline.
Extreme wealth masks deep poverty
The impact of federal restrictions on Medicaid will be felt across the country, but California has more beneficiaries than any other state in the country, with 14.5 million people.
More than one-third of all residents and half of the children in the state attend Medi-Cal. Mark Joffe, president of the Contra Costa Taxpayers Association and visiting fellow at the California Policy Center, said this is not only because the state is the most populous, but also because it doesn’t conduct eligibility tests as aggressively as other states.
But some believe California’s extreme wealth masks a coexistence of deep poverty. SEIU-UHW Chief of Staff Suzanne Jiminez said nearly 200,000 current beneficiaries could lose coverage due to the increased paperwork.
Darien Shanske, a law professor at the University of California, Davis, said the “moment of crisis” created by OBBBA is what prompted them to draft a tax on the state’s estimated 200 millionaires. As he explored various alternatives to make up for the funding lost by President Trump’s bill, he was thinking about “getting income taxes out of reach of the ultra-wealthy.”
But critics of the millionaire tax, such as Mr. Joffe of the California Policy Center, say the estimates of how many people will lose coverage may be overstated.
For example, those who are able to work could be required to work, participate in the community or attend college in exchange for coverage, he said. New illegal immigrants will no longer be eligible for coverage this year and will have to pay a $30 premium starting next year.
“It’s not as big a deal as the unions say,” Joffe told Al Jazeera.
Above all, what is raising hackles is the taxation of intangible assets, including stocks. Successful startup founders often retain their wealth in the form of company stock and become billionaires. But taxing it would “punish innovative people,” Joffe said. “There’s an emotional side to it, an aspect that seems unfair.”
This sentiment may be at the heart of a spate of moves out of state. Facebook founder Mark Zuckerberg is in talks to buy a $200 million home in Miami, according to the Wall Street Journal, potentially becoming the latest of several billionaires to move from California as the prospect of a billionaire tax looms.
Days before the tax went into effect on January 1, 2026, Google’s co-founders fired or moved 15 affiliate companies out of the state, according to the New York Times.
Billionaires are also funding opposition to this tax. Palantir Chairman Peter Thiel also reportedly moved out of state and donated $3 million to the California Roundtable political committee to oppose the measure. It is expected that such donations will continue to flow into the future.
But SEIU-UHW’s Jiminez said the idea of flight of capital and talent is “a fear tactic that will not be implemented.”
“I will take the case all the way to the Supreme Court.”
Sanchez’s hospital is already seeing more patients paying part of their premiums while the state pays part of the cost. Her hospital is the only trauma hospital within about 65 kilometers (40 miles), and a reduction in Medi-Cal payments could lead to a decline in hospital services, she said.
“I keep imagining people driving long distances with heart attacks and gunshots,” she told Al Jazeera.
Rural hospitals like Sanchez Hospital and home health care could be particularly affected by OBBBA’s job cuts, analysts said. They are also a strong source of employment in these communities.
Sanchez spent Valentine’s Day night and most evenings this month collecting ballot signatures from customers at a brewery near her home while her children did their homework at a table nearby.
“It’s important to note that the government is not going to be able to do that,” said Daniel Schnur, a political analyst and professor at the Institute of Government at the University of California, Berkeley. [the measure] “They were not eligible to vote in November,” he said, adding, “The timing could be very effective.”
Many voters who hoped to get rich may have admired Silicon Valley billionaires, but they are becoming increasingly disillusioned, he said.
In the 2025 Harris Poll, 94% of respondents said there is a disparity between rich and poor, and that corporate tax loopholes are the biggest cause of the disparity. About 71% of respondents said they supported a wealth tax.
California’s billionaire tax plan also found support in a January poll of Republican strategists conducted by the Melman Group, with 48% of respondents saying they supported it and 38% saying they did not support it.
Newsom, in his final term as governor, could face a difficult balancing act amid deep divisions between state unions and high-income taxpayers.
“What is the governor’s plan?” Sanchez asked about increased paperwork and the potential loss of Medi-Cal coverage for many residents.
Signing this bill could be just the beginning of a bumpy road ahead, given that taxpayer losses from the proposed millionaire tax could negatively impact an already unstable state budget.
“Governor Newsom will likely try to find a legislative solution to this. If movers are accepted, the Legislature could seek amendments to the bill,” Schnurr said.
The California Policy Center’s Joffe said the bill could face legal challenges if voted on in November, “and it would probably be litigated all the way to the Supreme Court.”
Chamath Palihapitiya, a venture capitalist and conservative commentator, said $1 trillion has already flowed out of the state due to tax projections as billionaires relocate their homes. It is unclear how he arrived at that number.
But “this is paper mobility,” said Shanske, the bill’s co-author.
“The destruction of the people’s club of talent and amenities and health care will make the state less attractive.”
