For California dentists who treat Medi-Cal patients, 2026 brought a reprieve but not an answer. The state budget signed this summer postponed about $1 billion in planned Medi-Cal Dental cuts for one year. The new date is July 1, 2027. The money behind the program’s higher rates is still on the table, as are dental benefits for some adult immigrants and a voter-approved funding stream that has partly been redirected.
The program is large. According to the California Dental Association (CDA), Medi-Cal Dental serves half of the state’s children and one-third of its adults. A March 2026 issue brief from the Healthforce Center at UCSF, citing state data, counts about 41.4 million dental procedures billed to Medi-Cal in 2024. About 28.3 million were for patients age 20 and younger, and about 13.1 million for adults.
What Proposition 56 pays for
Proposition 56, the 2016 tobacco tax measure, funds supplemental payments on top of base Medi-Cal Dental rates. CDA says the supplemental payments make up about one-third of current Medi-Cal Dental funding, and that losing them would push reimbursement back to 1990s levels.
The supplemental payments have been a budget target for two years running. In 2025 the governor’s revised budget proposed redirecting Prop 56 funds to help close a $12 billion deficit. The Legislature rejected that plan, and the June 2025 agreement kept the payments, along with dental coverage for undocumented adults, through July 1, 2026, according to CDA.
The 2026 budget: a one-year delay
Gov. Gavin Newsom and the Legislature reached a 2026–27 budget agreement on June 26, 2026. According to CDA, it protects all Medi-Cal Dental funding for another year. It pushes the proposed cuts of about $1 billion from July 1, 2026 to July 1, 2027, and keeps current reimbursement rate levels and dental benefits for people without permanent legal status. ADA News, reporting in October, described the same outcome. The American Dental Association’s Health Policy Institute supplied research that CDA used in its advocacy.
The cuts have been delayed, not repealed. CDA and the coalition it convened, Save Our Dental Care, say they will keep pressing to prevent them in next year’s budget.
“They made the right decision and avoided what would be a devastating collapse of the program.” — Robert Hanlon, DDS, CDA president, in a CDA statement on the 2026–27 budget
Immigrant adults: freeze, scheduled cuts, premiums
The 2025–26 budget also made eligibility changes for undocumented adults. A summary published by the California Pan-Ethnic Health Network (CPEHN) lists three:
- A freeze on new enrollment for undocumented adults starting January 1, 2026. People already enrolled can keep coverage if they continue to qualify.
- An end to preventive and restorative dental services for adults 19 and older in these groups, originally scheduled for July 1, 2026, leaving emergency dental care only.
- A $30 monthly premium for adults in these groups starting July 1, 2027.
According to CDA and ADA News, the 2026–27 agreement preserved dental benefits for people without permanent legal status, so the July 2026 dental cutoff did not take effect as originally scheduled. Practices that treat these patients should check current eligibility with the Department of Health Care Services (DHCS) and expect the issue to come back in the 2027 budget.
Proposition 35 and federal pressure
Voters approved Proposition 35 with 68 percent support. It made the state’s managed care organization (MCO) tax permanent and dedicated the revenue to Medi-Cal, including Medi-Cal Dental reimbursement rates starting in 2027. CDA says the 2025 state budget instead diverted Prop 35 money to cover Medi-Cal costs already incurred. In a June 2025 release, the association said this “disregards the will of the voters and raises serious legal concerns.”
Federal law adds uncertainty. CDA notes that the federal budget bill signed July 4, 2025 cuts Medicaid spending by about $1 trillion over ten years and restricts provider taxes, including the MCO tax that Prop 35 depends on. The federal government covers nearly 60 percent of Medi-Cal costs.
Who actually participates
Participation figures help explain why rates matter. CDA credits the Prop 56 payments with a 34 percent increase in Medi-Cal Dental providers and a 37 percent increase in new dental office visits by Medi-Cal patients. It also cites a member survey in which 49 percent of Medi-Cal dentists said they would leave the program if the cuts took effect. Those are the association’s figures, gathered for its advocacy.
The UCSF brief uses a stricter measure. It reports estimates presented to a state advisory council: about 40 percent of California dentists were enrolled as Medi-Cal providers, but only 25 percent submitted a claim in 2019, and only 15 percent saw more than 100 adult patients that year. The authors also note that CalHealthCares, a Prop 56-funded loan repayment program for providers, is paused. They argue that because of funding swings like these, rate increases alone have not changed how many dentists see Medi-Cal patients.
The adult benefit has been cut before. An ADA Health Policy Institute brief cited by ADA News notes that California eliminated most adult Medicaid dental benefits in 2009, leaving about 3 million adult beneficiaries without preventive coverage, and that emergency department visits for nontraumatic dental conditions rose afterward.
What practice owners should watch
- July 1, 2027. This is the new effective date for the Prop 56 cut. The 2027–28 budget, negotiated next spring, will decide whether it holds.
- Prop 35 dollars. The measure’s dental rate funding is set to begin in 2027. Whether it reaches rates depends on state budget choices and federal limits on the MCO tax.
- Patient eligibility. Immigrant adults’ coverage is affected by the enrollment freeze and the 2027 premium. Front-desk eligibility checks will matter more.
- Official notices. DHCS publishes provider bulletins and fee schedule changes through the Medi-Cal Dental provider site. Those notices, not advocacy summaries, govern billing.
For now, rates and benefits are unchanged through June 2027. Owners deciding whether to enroll, expand or limit Medi-Cal patient schedules face the same question they had last year, one year later.
Sources
- California Dental Association, “Medi-Cal Dental funding protected for another year in new state budget” (June 29, 2026)
- ADA News, “ADA, CDA collaboration helps protect Proposition 56 dental funding” (October 2, 2026)
- California Dental Association, “CDA advocacy preserves Medi-Cal Dental funding, but budget uncertainty continues” (2025)
- California Pan-Ethnic Health Network, “Changes to Medi-Cal: Dental Benefits for Immigrant Populations” (January 2026)
- Davis M, Mertz E. “The California Oral Health Workforce: Deficits and Opportunities.” Healthforce Center at UCSF, March 2026
- DHCS, Medi-Cal Dental provider information
