Two recent changes in health policy will likely negatively impact state budgets and the health of low-income Californians with chronic disease. The new cost-sharing for medical visits, pharmaceuticals, and inpatient stays in California’s Medcaid program (Medi-Cal) and the exclusion of the undocumented and individuals who have been legal residents for less than five years from the insurance expansions that The Patient Protection and Affordable Care Act of 2010 provides will reduce medical care utilization and may raise, rather than lower, state costs. Based on historical Medi-Cal utilization patterns, people living with HIV (PLWH) would average $514 in cost-sharing fees annually. The undocumented may lose coverage entirely and face even higher costs. The charges are high relative to the low incomes of both Medi-Cal recipients and the undocumented and are likely to discourage relatively inexpensive, but productive, medical care. Increasing patient costs harms patient health, harms public health, and increases state spending on medical care.