CSAC + CWDA Counties Demand $6.4B from State Post-May Revise — Counties Threaten to Sue Over 'State Responsibility' Cost-Shift

Following Governor Newsom's May 14 May Revise, California State Association of Counties CEO Graham Knaus issued sharp public pushback: counties want $6.4B over two years to backfill Medi-Cal coverage losses, hospital support, and BH services. Knaus' quote: 'The governor proposes to hide from state responsibility while demanding counties do the state's job for free.' County-by-county requests align with prior figures: Sacramento County (Lutz) wants $1.9B FY26-27 + $4.5B FY27-28; Fresno County is $241M indigent care exposed (already tracked); LA County preserves DPH via $63.2M new ongoing local funds plus reserve drawdowns. CSAC/CWDA may litigate or block budget elements. Affects ALL counties operating clinic systems: LA DHS, AHS (Alameda), SF DPH, Sacramento DHS, San Diego HHSA, Riverside RUHS, Ventura County HCA, Monterey County Health, Santa Cruz HSA, San Bernardino DBH. Strategic implication for FQHCs: (1) county Medi-Cal cost-shifts will likely translate to reductions in county-FQHC contracts (ECM, CalAIM Community Supports, BH crisis services); (2) FQHCs serving as residual safety-net for closed county clinics will absorb uninsured volume; (3) align CPCA/CCALAC advocacy with CSAC/CWDA testimony in June 15 budget conference committee window.