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The television industry has changed dramatically over the last decade, but one tradition that won’t die is the annual gathering of ad-buying execs in Manhattan to hear the pitches of networks and streamers looking to sell their commercial time.

This past week’s lavish presentations, known as the upfronts, included the usual array of big-name actors (Arnold Schwarzenegger and Jennifer Lopez), NFL legends (Tom Brady and Mike Tomlin) and “Real Housewives,” past and present.

Jennifer Lopez and Brett Goldstein speak onstage during the 2026 Netflix Upfront at Sunset Pier 94 Studios on May 13.

(Dimitrios Kambouris/Getty Images for Netflix)

The selling buzzwords are far different from the days when the presentations were a vehicle for networks to boast about their ratings and present new program line-ups. The 2026 upfronts talked a lot about “connections” and “community” as the personalized nature of TV viewing brought on by streaming video-on-demand has been fully integrated into the buying and selling of commercials.

“Three of us could be watching the same show, maybe at a different time, maybe at the same time, but receive very different advertising based on what ad technologies, know about us as an audience segment,” said Josh Mattison, executive vice president of digital revenue pricing, planning and operations for Walt Disney Co. “The old model would be, hey, did 10 million people watch this ad? 
I think the new model is, which 10 million people watch this ad.”

Here’s a sampling of what ad executives were seeing and hearing this week:

Using new ad tools that target viewers

Every company presentation touted advancements in the ability to target consumers now that advertising has become the main source of revenue growth in the streaming business. They also played up new services — such as NBC’s Performance Insights Hub — providing advertisers with up to date information on the effectiveness of their advertising so they can adjust accordingly.

Streamers can take the consumer research collected by advertisers and align them with the viewing habits of their subscribers. The data are analyzed in a secure room to protect consumer privacy.

Netflix doesn’t ask subscribers for personal information in the sign-up process, as it can discourage people from buying the service. But the company does use the viewer habits on the platform to help advertisers reach the customers they seek.

“We are seeing where there is overlap and use that to help our advertisers target better,” Amy Reinhard, president of advertising for Netflix, told The Times. “It’s all based on viewer preferences.”

Every company is turning to AI to respond to the needs of advertisers. NBC now offers them the chance to insert commercials that relate to the action seen on the screen during live sports events.

Creators are going mainstream

YouTube’s annual upfront gatherings used to have the feel of an alternative show business universe, with personalities who built their rabid followings on the streaming platform far away from the audiences for traditional TV.

Now creators such as the sports stunt group Dude Perfect have their own studios. Beast Industries, the corporate home of MrBeast, held its own invitation-only breakfast for marketing executives at a high-end New York venue . YouTube stars, such as Jesser, are landing shows on other platforms.

At YouTube’s presentation at Lincoln Center, longtime favorites such as “Call Her Daddy” podcast mogul Alex Cooper and “SubwayTakes” host Kareem Rhama appeared on stage to announce new projects on the platform, looking more like established show producers rather than social media renegades.

Ten years ago, YouTube advertisers had to worry about their spots running next to Islamic State videos. Now it’s become common for marketers to embrace YouTube stars and fully integrate products and messages into their programs.

“When creators talk about your products on YouTube, viewers are 13 times more likely to search for your brands and five times more likely to buy,” said Paul Downey, president of Americas & Global Partners for YouTube.

Mary Ellen Coe, chief business officer for YouTube, told The Times that advertisers can determine if a creator is right for their brand by looking at audience numbers, subscriber data and comments from their communities of fans. But many have their own personal focus groups at home that introduce the hottest YouTube personalities.

“Most of these advertisers have children and teenagers and they go nuts for them,” Coe said.

YouTube is the most watched TV platform according to Nielsen, accounting for nearly 13% of all TV viewing. But that share is much higher among younger consumers.

“My kids don’t watch TV — they watch YouTube,” said Anthony Pedalino, vice president and head of media investment at the ad buying firm Giant Spoon. “So I think this is a bit of future proofing.”

Other companies are seeking creators for their platform.

Amazon Prime Video introduced an alternative feed of some of its NBA games on its streaming platform Twitch, which will turn them into a “CreatorCast.” The streamers who are regulars on the site call the action live in an effort to bring in younger fans. The format will be used in WNBA games in the league’s new season.

Fox touted its creator initiative that develops programs for Tubi, the company’s fast-growing ad-supported streaming platform that now has 100 million active users. The company also has a partnership with TikTok to support creators who want to turn their short-form clips into full-length programs.

There’s always room for comfort food

Amid all the innovations in ad buying and audience measurement presented during the week, many of the programs and personalities offered up by the major networks and streamers were extremely familiar.

“They may be resigned to the fact that people are going to go to emerging platforms for more niche and esoteric programs,” Pedalino said.

Oprah Winfrey made an entrance on the Beacon Theatre stage to promote the move of her podcasts to Amazon Prime Video.

Disney rolled out the cast of “Scrubs” to announce another 10-episode order of the early 2000s sitcom for Hulu. The series had a successful reboot as Gen Z viewers continue to devour vintage programs. Amazon Prime announced “The Greatest,” a Michael B. Jordan-produced mini-series on legendary heavyweight fighter Muhammad Ali, not exactly uncharted territory.

Fox introduced a reboot of “Baywatch,” which was canceled after a single season on NBC in 1990, but went on to become a worldwide hit in syndication over the decade that followed. The slow-motion shots of toned lifeguard bodies running into Venice beach waters are coming back without a hint of irony.

Netflix brought out the set of “Pop Culture Jeopardy” at its presentation at Sunset Pier 94 Studios, NBC previewed comedies with proven prime time stars and touted its 100th anniversary which will be celebrated with an old-fashioned variety special later this year.

Vice President JD Vance said Wednesday that the Trump administration is deferring $1.3 billion in Medicaid reimbursements to California over concerns the state is allowing “fraudsters” to drive up costs to taxpayers, including by pushing unnecessary medications on unsuspecting patients.

“There are California taxpayers and American taxpayers who are being defrauded because California isn’t taking its program seriously. But also, you have people who’ve been prescribed medications that they don’t even need,” Vance said. “Sometimes they’ve had drugs put into their bodies that they don’t need because fraudsters have actually encouraged false prescriptions and false administration and medications.”

Vance, standing alongside Dr. Mehmet Oz, the administrator for the Centers for Medicare and Medicaid Services, said the administration is also sending letters to all 50 states informing them that if they do not “effectively and aggressively prosecute Medicaid fraud in their states,” they will see federal funding cut off as well.

“We want California to get serious about this fraud,” said Vance, who President Trump named his “fraud czar” last month.

Oz called out what he said was widespread fraud in hospice services and similar in-home care programs nationally — and particularly in the Los Angeles region — and announced a six-month moratorium on new Medicare enrollment for hospices and home health agencies.

“A third of all these programs in the entire country are in Los Angeles. Ask yourself, how is that possible? It’s not,” Oz said. “They’re not that many people dying in Los Angeles. We’re not talking about California, just Los Angeles.”

He said he and others in the administration determined that “at least half of the hospices, in the entire area around Los Angeles, are fraudulent,” and had shut down 800 of them that last year had “charged the federal taxpayer $1.4 billion,” which “will no longer be paid.” That is a major increase from the 450 providers the administration said it had suspended as of last month.

The announcement was the latest attempt by the Trump administration to highlight and rein in fraud in federal healthcare benefits programs, particularly in blue states. The actions were met with immediate push back from California officials.

“We hate fraud. But that’s NOT what this is,” Gov. Gavin Newsom’s office posted on the social media site X. “Vance and Oz are attacking programs that keep seniors and people with disabilities OUT of nursing homes. Pretty sick.”

Newsom’s office said that the growth of In-Home Supportive Services placements in California was “simple,” and due to California “keeping more people OUT of far more expensive nursing homes!”

Such services cover assistants who help people with daily tasks such as bathing, laundry or cooking; provide needed care such as injections under the direction of a medical professional; and accompany them to and from doctor’s appointments. A 2020 report by the California state auditor found that nearly three-quarters of IHSS caregivers assist a family member.

Newsom’s office wrote IHSS care costs $30,000 a year, while nursing home care costs $137,000 a year. “SAVING TAXPAYERS: $107K per person,” it wrote.

California Atty. Gen. Rob Bonta also criticized the administration’s moves.

“Once again, California appears to be targeted solely for political reasons,” Bonta said. “The Trump administration is planning to defer over $1 billion in Medicaid funding for vital programs that helps seniors and people with disabilities remain safely in their homes.

“My team is carefully reviewing all available information. We have not hesitated to challenge unlawful actions by the Trump administration, and we will continue to act whenever Californians’ rights or access to critical services are threatened,” he said.

Democratic Sen. Alex Padilla also lashed out at the Trump administration.

“The Trump Administration is attacking California over claims that they can’t back up,” Padilla wrote on social media. “Let’s be real, this isn’t about fraud — it’s about punishing a state that didn’t vote for him. Political retribution plain and simple.”

Fraud in California’s hospice industry has been a problem for years.

Authorities in the state promised to crack down on the issue after a Times investigation in late 2020 revealed that unscrupulous providers were billing Medicare for hospice services and equipment for patients who were not actually dying — with the hospice industry in the state exploding in size.

California’s Medicaid program, known as Medi-Cal, is expected to cost about $222 billion for the budget year starting July 1, including both state and federal funding. Roughly 15 million Californians, more than a third of the state, are on Medi-Cal.

Vance, a potential 2028 presidential hopeful, has taken up his work as “fraud czar” with vigor, traveling around the country to drive home the idea that the Trump administration is working diligently to bring down healthcare costs by addressing waste, fraud and abuse that is rampant across the system.

He has said that waste and abuse is particularly prevalent in Democratic-led states such as California, New York and Minnesota.

“We have red states and blue states that go after fraud aggressively, but we also, unfortunately, have some states, mostly blue states, unfortunately, that do not take Medicaid fraud very seriously,” he said Wednesday.

Vance specifically threatened to cut off what he said is billions in federal funding for state-run fraud control units that are meant to prosecute people who abuse the system, but which he said aren’t doing the work. “This is a tool that we want the states to use, but unfortunately, a lot of states aren’t using these tools at all,” he said.

The focus on fraud comes against a backdrop of criticisms that other policy measures pushed by the administration have driven healthcare costs up or made it harder for people to access healthcare — including cuts to Obamacare subsidies and new work requirements in Medicaid, which are expected to strain hospitals around the country and led to millions of people losing healthcare coverage.

Democrats and Republicans have argued over who is to blame for rising healthcare costs, and Vance and Oz have clashed with California leaders before.

In January, Newsom filed a civil rights complaint against Oz after he posted a video accusing Armenian crime groups of carrying out widespread healthcare fraud in Los Angeles. In the video, Oz was shown driving around Van Nuys, saying about $3.5 billion worth of Medicare fraud had been perpetrated by hospice and home care businesses — and “run, quite a bit of it, by the Russian Armenian mafia.”

Newsom called Oz’s claims “baseless and racist.”

The administration previously launched investigations into potential healthcare fraud in at least five states — California, Florida, Maine, Minnesota and New York — and halted some $243 million in Medicaid payments to Minnesota over fraud concerns.

The Centers for Medicare & Medicaid Services has also acknowledged using errant figures to justify a fraud probe in New York, deepening concerns in the administration’s methods for identifying problematic activity.

Vance said the deferral of funds to California and the letters warning other states to get serious is not about political retribution, but a wake up call. He said the Trump administration wants to help states root out fraud and abuse, including with new technologies — but can’t do so if they are not “willing to help themselves” first.

“We don’t want to turn off any money. What we want to do is ensure that people are taking fraud seriously. We want to protect Medicaid, we want to protect Medicare,” Vance said. “But we can’t do that if the states that are administering those programs are allowing those programs to be fleeced by fraudsters.”

The Associated Press contributed to this article.

Here’s a riddle for you: A conservative Republican senator, a top economic advisor to the Trump White House and a venture capitalist walk into a conference room at a financial conference and claim a new government program will be a boon for all American families.

Question: Do you think these people are looking out for your interests?

If you trust Sen. Ted Cruz, economic advisor Kevin Hassett and millionaire Brad Gerstner to do so, feel free to stop reading here.

If you’re skeptical, read on.

But keep in mind that Cruz (R-Tex.) was last seen in these pages promoting yet another big tax break for the 1%, Hassett appeared the other day on Fox Business arguing that while Americans are spending a lot more on gasoline, “they’re spending more on everything else too” on their credit cards, as if forcing households to max out their credit is a good thing; and Gerstner is, well, a millionaire tech investor.

At their panel discussion on May 4 at the annual Milken conference, Cruz, Hassett, Gerstner and their interlocutor, Michael Milken, talked as though the Trump accounts would be so fabulous for average American families that they would obviate the need for Social Security.

“Here’s the dirty little secret,” Cruz said. “Trump accounts are Social Security personal accounts.”

Milken echoed that thought: “Do you have the right to decide where your money goes, or should you be giving it to the government and [letting] them decide where it goes?”

That gave the game away — this is yet another effort by Republicans and conservatives to end a program they’ve been trying to kill, and to give Wall Street firms a bigger bite of your retirement resources.

Let’s start with a primer about the Trump accounts, which were part of last year’s GOP budget bill and will be open to investment starting on July 4.

The headline pitch for these accounts is that they’ll be seeded with a one-time $1,000 government contribution for children born from 2025 through 2028, unless Congress extends the government donation. Accounts can be opened for children born before or after those dates, but they won’t get the government donation.

Families can add up to another $5,000 in contributions every year until the child reaches 18, but those donations won’t be tax-deductible.

The money must be invested in low-cost stock index funds or exchange-traded stock index funds, and can’t be withdrawn for any reason without penalty until age 18. After that, the funds can be withdrawn without penalty for certain purposes such as educational expenses or the purchase of a first home. The accounts eventually become converted to conventional individual retirement accounts, or IRAs, and distributions will be taxed as ordinary income, though family contributions will be returned tax-free.

That $1,000 donation is the best feature of the accounts. But that may be their only good feature. For almost all the financial goals confronting average American families, such as saving for college or retirement, they’re inferior to tax-advantaged savings plans already on the books.

Like those programs, they’re much more advantageous for wealthier than to low-income families: Wealthier families typically have the wherewithal to make their annual contributions, and get a larger break from the tax deferrals of investment growth within the accounts because their tax rates are higher.

Though their promoters claim that the accounts will level the economic playing field for all families — “helping the bottom 10%,” Hassett said on the panel — that’s not the case. “Clearly, the program is structured to subsidize savings for those who already have the capacity to save, rather than meaningfully closing the wealth gap,” observes Sheryl Rowling of Morningstar.

Another drawback cited by economists and financial planners is that the accounts are locked into corporate equity investments. Before the beneficiary reaches age 18, the investment mix can’t be adjusted. That’s dangerous because portfolio concentrations in corporate shares are inherently risky.

“A high school senior who plans to enroll in college next year cannot change the investment to a lower-risk portfolio,” say, to a mix of equities and bonds, notes Greg Leiserson of the Tax Law Center at NYU. “If the market crashes the summer before she plans to enroll, the Trump Account is of greatly reduced use.”

Trump account promoters have massively overstated the potential wealth gains for ordinary Americans. At the Milken conference, Cruz said that a child with a Trump account will have about $170,000 in it when he or she reaches 18 and $700,000 at age 35. “And very quickly after that, you get into the millions,” he said.

Cruz did acknowledge that those figures apply to households that “contribute regularly.” In fact, they apply largely to households that contribute the maximum $5,000 every year.

The White House estimates of potential returns are based on questionable assumptions about stock market gains over the 18-year periods in which the accounts will grow on a tax-deferred basis.

According to the government’s own estimates, the account of a family taking the $1,000 seed money but making no contributions beyond that would have as little as $2,577 in their account after 18 years if stock market returns come to 5.4% over that period.

The government estimates, however, that the account would hold $730,395 if the family contributes the maximum every year and the stock market returns more than 18%. Another 10 years of growth at that level, and the account would grow to $1.9 million when the child reaches age 28.

The problem with long-term market estimates, such as the ones offered by the White House, is that they’re highly variable. No 18-year periods are the same. One thousand dollars deposited in a hypothetical account invested in a Standard & Poor’s 500 index fund would grow to about $6,600 if its 18-year lifetime culminated in 2025; if the 18 years ended in 2008, however, that deposit would have grown only to $3,960. In the 18-year period that ended in 1960, the account would have grown only to $2,940. What will the next 18 years bring? Who knows?

Variability like this, along with the sheer uncertainty of stock market projections for the future, helped sink George W. Bush’s 2005 attempt to convert Social Security into private accounts, which was also pitched as a key to minting millionaires by the millions through the magic of the market.

I asked the White House to respond to these criticisms. Spokesman Kush Desai called my questions “both a stupid and out-of-touch take,” asserting that the accounts are “already shaping up to make a generational difference for working-class children.”

The truth is that if Trump were really intent on taking steps to “strengthen the financial security of American workers” and creating a “path to prosperity for a generation of American kids,” as he claims to be, he and his GOP followers in Congress wouldn’t have scissored away the American safety net, which is what they’ve done.

They wouldn’t have imposed new work requirements and narrowed eligibility standards for food stamps, resulting in the exclusion of more than 3 million people from the program, a decline of 8%. They wouldn’t have cut nearly $1 trillion in funding for Medicaid over 10 years, jeopardizing coverage for 3.6 million young adults. They wouldn’t have allowed Affordable Care Act premium subsidies to expire, resulting in a drop in Obamacare enrollments of about 1.2 million Americans this year compared with last year.

If they really cared about educational opportunities for “a generation of American kids,” they wouldn’t have narrowed eligibility for higher education Pell grants, and wouldn’t slash research grants for universities coast to coast.

So how can families better prepare for college and retirement expenses? For education, 529 plans are probably preferable to Trump accounts. The investment choices are more flexible, withdrawals are tax-free at the federal level and sometimes at state levels if used for most education expenses, and there are no federal limits on contributions (contributions aren’t tax-deductible).

For retirement, advisers have been favoring Roth IRAs. Contributions are not tax-deductible, and this year can be made by couples filing jointly with taxable income up to $242,000 ($153,000 for singles) and are limited to $7,500 a year ($8,600 for those 50 and older). But withdrawals aren’t taxed if you’ve held the account for at least five years and you take the money out after you turn 59 1⁄2.

The bottom line, then, is this. Take the $1,000 if your child is eligible. As Rowling wisely advises, “Any time the government offers free money, you should take it.”

As for the rest, treat any claims offered by Trump account promoters as inherently suspect.

SACRAMENTO — Newborns won’t be leaving the hospital empty-handed in California.

Gov. Gavin Newsom announced on Friday that the state is partnering with Baby2Baby to provide 400 free diapers to every newborn. Baby2Baby is a national nonprofit based in California that provides clothing and other basic necessities to children.

The governor said it would help families with the rising cost of living.

“Since the pandemic, we have seen the cost of diapers go up by 45%,” said Newsom, speaking at a press conference in San Francisco. “One out of four families skip meals to pay for diapers.”

The new program, dubbed the Golden State Start, will launch this summer. Participating hospitals will distribute the diapers to families at the time of discharge. Forty million diapers will be distributed during the program’s first year, with a goal of later expanding the program to provide 160 million.

Newsom said the state will prioritize hospitals that serve large numbers of parents enrolled in Medi-Cal, California’s version of the federal Medicaid program providing healthcare coverage to low-income Americans. The state plans to later expand to additional hospitals and birthing centers.

The governor described the program as the first of its kind in the nation.

“We are not imitating; we are a model to others,” he said.

Kim Johnson, secretary of the California Health and Human Services Agency, said the initiative would help families enjoy their first few weeks at home with a new baby.

“The first days at home with a newborn should be focused on the love, connection, and joy of an expanded family, not stress about affording diapers,” Johnson said in a statement. “This program helps ensure families can begin that journey with greater stability and peace of mind.”

The National Diaper Bank Network, a national nonprofit that tracks diaper insecurity, found about 60% of low-income families nationwide struggle with the cost of diapers and rely on less-frequent changes to get by. The organization said dirty diapers leave babies at risk of developing rashes or urinary tract infections.

SACRAMENTO — One of Gavin Newsom’s top goals as he winds down his final year as California governor is to leave the state with a balanced budget.

After years of the state spending more money than it brings in, it’s Newsom’s last opportunity to fix a chronic deficit or dump the problem on the next governor.

How far he goes to solve the state’s structural spending imbalance will define his legacy as a steward of trillions in taxpayer dollars. As a potential candidate for president in 2028, he could also have a political incentive to do as little as possible.

“Any cuts you make are going to cause people to scream,” said Darry Sragow, a veteran Democratic strategist. “Any increases in taxes are going to cause people to scream and in terms of what’s best for a presidential run, it would be nice if people weren’t screaming.”

As California’s 40th governor, Newsom expanded publicly funded healthcare to income-eligible undocumented immigrants, increased state-subsidized child-care slots and provided free meals for schoolchildren among a wishlist of progressive wins since he took office in 2019.

His achievements have helped struggling Californians live in an increasingly unaffordable state and given him bona fides to tout to voters if he launches a bid for the White House.

But the state could never afford to pay for existing services and the new programs that Newsom and Democratic lawmakers enacted, according to an analysis of ongoing state spending since before the pandemic released by the Legislative Analyst’s Office last week.

Spending from the state’s principal operating fund has grown about $100 billion since Newsom’s first full fiscal year in office in 2019-20, mostly due to the growing cost of existing programs that he inherited. State spending has outpaced California’s strong revenue growth by about 10%, creating a perennial budget shortfall — a structural deficit — that Newsom and the Democratic-led Legislature solve with largely temporary fixes each year.

Instead of making across-the-board program cuts or raising taxes to align spending with revenue, Democrats have tapped into reserves designed to preserve social services for the state’s most disadvantaged communities during economic downturns.

While the California economy remains stable and state revenue has increased, Newsom and lawmakers have taken $12.2 billion from the rainy day fund. Democrats have borrowed $28 billion more from other state funds to cover their spending in recent years, according to the LAO.

“Taken together, these trends raise serious concerns about the state’s fiscal sustainability,” Legislative Analyst Gabriel Petek wrote in a review of Newsom’s January budget proposal.

Fiscal watchdogs have warned that the spending trends will leave California in a precarious position if the stock market tanks and tax receipts bottom out.

Personal income taxes are driving higher-than-expected revenue now, which analysts attribute to an artificial intelligence boom on Wall Street, and suggest the state could have no deficit in the upcoming year. In January, the Newsom administration anticipated significant operating deficits in the years ahead: $27 billion in 2027-28, $22 billion in 2028-29 and $23 billion in 2029-30.

The LAO, the Legislature’s nonpartisan fiscal advisor, said the state has already solved $125 billion in budget problems over the last three years with mostly short-term solutions.

“This issue is really whether they’re going to take seriously the structural deficit that is several years in the making now, where the spending has outpaced revenue, and to address that, they’re going to either have to make some fairly deep cuts or raise revenue and or both,” said former state Controller Betty Yee, who worked as a budget aide under Gov. Gray Davis and recently dropped her own campaign for governor. “But they have to be real. I think resorting to these one-time solutions has really exacerbated the problem.”

How Newsom wants to address the state’s financial challenges will be revealed on May 14 when he is expected to present his revised budget plan in Sacramento. His January budget proposal did not include any significant reductions or cuts to programs.

H.D. Palmer, a spokesperson for the California Department of Finance, said the governor is looking to solve the budget problem with more than a temporary fix.

“Although he is still finalizing his proposal that he’ll put forth to the Legislature, as he has said, he wants those solutions to be durable, and he wants them to have an impact beyond a single fiscal year,” Palmer said.

To stabilize California’s budget, Democrats will probably have to raise taxes or fees to generate new revenue and cut programs, according to the LAO. At least 40 cents for every dollar in revenue is dedicated to education under the state Constitution, requiring policymakers to find between $30 billion and $60 billion annually in additional revenue to cover projected shortfalls in 2027-28 and beyond if relying on new taxes alone.

President Trump’s cuts to healthcare are adding to the problem.

HR 1 will add $1.4 billion in state costs to the general fund. Newsom’s January budget proposal did not include a plan to help millions of low-income Californians who are expected to lose access to healthcare under the federal cuts.

To temper those cuts in California, other groups proposed a new tax on billionaires that appears poised to qualify for the November ballot.

Spearheaded by Service Employees International Union-United Healthcare Workers West, the initiative would apply a one-time 5% tax on taxpayers with assets exceeding $1 billion. If approved by voters, the tax would generate roughly $100 billion, which would fund healthcare programs.

The measure has divided unions and Democrats at the state Capitol.

Newsom has criticized the initiative, citing concerns that increasing taxes on the wealthy will have the opposite intended effect and drive the highest earners out of California. Under a progressive tax structure, the state budget is dependent on income taxes paid by the ultra-rich on earnings largely from capital gains.

Larry Page and Sergey Brin, the co-founders of Google, have already purchased residences in Florida, along with others looking to escape the tax if it goes through in November. Billionaires launched their own ballot measure campaign to undercut the tax proposal.

State lawmakers are also considering avenues to raise revenue, which include repealing a “water’s edge” tax break. Under the change, multinational companies would no longer be allowed to shield the income of their foreign subsidiaries from state taxes. California loses about $3 billion in revenue from the tax break each year.

In its budget plan released in April, the state Senate proposed a new fee on the largest corporations in the state to provide $5 billion to $8 billion annually for Medi-Cal.

The upper house said 42% of Medi-Cal enrollees are full-time workers who are not enrolled in their company’s healthcare plan because their wages are low enough to qualify for state-subsidized healthcare. As a result, corporations aren’t paying for healthcare for many of their employees and instead taxpayers are picking up the bill through Medi-Cal.

SEIU California, the powerful state union council representing over 700,000 workers, endorsed the plan. The union said Trump’s tax policy will reduce corporate taxes by $900 billion, while 3 million Californians lose healthcare.

“In this urgent moment, California’s workers need to see our leaders show us what they’re made of,” said Tia Orr, executive director of SEIU California. “The Senate is showing the courage to demand corporations pay their fair share, rather than making working people pay with their lives.”

The change is being described as a more politically palatable “fee” and not a tax.

“We explored multiple revenue options, and this was the one that felt more narrow, it felt more focused, and it also felt like it was directly going for the subsidy that’s being lost because of the Trump HR 1 cuts,” said Senate President Pro Tem Monique Limón (D-Goleta), who leads the upper house of the Legislature.

Limón said her caucus believes it’s important to address potential revenue streams because of the depth of federal healthcare reductions.

“If we don’t address the structural deficit, we are looking at severe cuts,” she said. “You are looking at people without health insurance. You are looking at hospitals closing down. You are looking at medical providers not being able to take more patients. You are looking at our emergency rooms over capacity, with not enough medical providers. I mean, you’re looking at a place that’s really, really, really difficult, and we feel like we have to, at least, look at what are viable options that are conditional on these cuts coming.”

Newsom has not commented publicly on the Senate’s plan. As governor, he’s been reluctant to embrace new taxes and fees.

Newsom could reject all the proposals for new taxes or fees and continue what he’s done before: take advantage of higher-than-expected tax collections, shift funds around, delay program implementation and borrow money to knock the deficit down to zero, or forecast a surplus, for his last budget year that begins July 1.

If he doesn’t take on California’s larger budget imbalance, then the problem would be the next governor’s to solve. A stock market crash, or economic recession, could force his successor to make drastic cuts across the board with limited reserves to support programs.

Kicking the can again would cement Newsom’s fiscal legacy as a governor who championed bold headline-making policies that bolstered the safety net for low-income Californians, but who failed to provide a solution to pay for his agenda.

“Not only has he not come up with a plan, he has pretended we don’t need one,” said Patrick Murphy, a professor of public affairs at the University of San Francisco.

Newsom’s interest in running for president could seemingly discourage him from slashing the budget and raising attention to the state’s financial woes, Sragow said. Newsom is setting himself up as a potential front-runner for his party. He has said he remains undecided about officially launching a 2028 campaign.

As a Democrat from California, his opponents would automatically label him as financially irresponsible and tax-happy. Calling out the massive budget problem on the horizon, raising taxes and making painful cuts will give them ammunition.

“There’s a long list of things that he’s going to be charged with, and this is likely to be one more,” Sragow said. “But I guess the question is, is he going to be charged with a political misdemeanor or a political felony?”

Former state Sen. Steve Glazer said Newsom is standing on political quicksand either way. State budget projections are based on assumptions about the future that often don’t bear out, leaving his choices exposed to criticism that he went too far, didn’t do enough, and everything in between.

“Whatever the governor decides to do in his May revise and in his final budget, it’s fraught with political risks, because it can be manipulated so easily by all sides,” Glazer said.

If Newsom ignores the spending problem, his successor could blame him for California’s financial woes when they take office in January and provide their own outlook of the state’s fiscal future. At the time, Newsom could be trying to convince America to make him the nation’s next president.

Murphy said Newsom has championed major policies and been reluctant to back off them later when revenue doesn’t pencil out.

In terms of spending, he’s governed similarly to the men who led California before him, with the exception of Jerry Brown, who cut programs to reduce a deficit he inherited in his second stint in the governor’s office and left Newsom with a surplus.

“It’s not all that different than most of the governors have done, which is finding it very hard to say no and finding it very hard to take on a tough choice of going to the ballot to ask for more money or raise taxes,” Murphy said.

On taxation, Newsom is perhaps most similar to former Gov. George Deukmejian, who opposed general tax increases for most of his administration.

Deukmejian left a budget disaster for his successor, Gov. Pete Wilson. Deukmejian publicly claimed he passed a balanced budget in his final year and blamed an economic downturn for the problems Wilson encountered.

When Wilson announced a record $13-billion budget deficit early in his first year in office in 1991, he said the Persian Gulf War, an economic downturn and natural disasters added to a structural deficit in the budget.

The Legislature and Deukmejian, Wilson said, had “papered over” the problem.

OMAHA, Neb. — Nebraska on Friday will become the first state to enforce work, volunteer or education requirements for new Medicaid applicants, eight months before the federally mandated requirements kick in.

Advocates worry that the state is launching so rapidly that key details remain unresolved and some people who are eligible for coverage will lose it.

State officials say they’re prepared, training staff and sending letters, emails and texts to people who could be impacted.

Health policy experts, advocates and other states will be watching closely.

“It can be used as a lesson for other states, both where things go well and where things don’t go well,” said Jennifer Tolbert, deputy director of KFF’s Program on Medicaid and the Uninsured.

The law is expected to leave some without insurance

The work requirement is part of a broad tax and policy law that President Trump signed last year. Nebraska Republican Gov. Jim Pillen announced in December that the state would implement it eight months before it was required, saying the aim was “making sure we get every able-bodied Nebraskan to be a part of our community.”

The state had one of the lowest unemployment rates in the U.S. in February: 3.1%.

The federal policy won’t apply to all Medicaid beneficiaries, just those who are enrolled under an expansion that most states chose to make to allow more low-income people to get healthcare coverage.

Under the change, many Medicaid participants ages 19 through 64 will have to show that they work or do community service at least 80 hours a month, or are enrolled in school at least half-time. They’ll also have their eligibility reviewed every six months rather than annually, so they could lose coverage faster if their circumstances change.

Exceptions will be made for people who are too medically frail to work or in addiction treatment programs, among others.

An Urban Institute report from March estimated that the changes would mean about 5 million to 10 million fewer people nationally would be enrolled in Medicaid than would have been otherwise.

Choices states make about how to run their programs are expected to be a major factor in exactly how many people lose coverage.

“The higher the administrative burden, the more likely people are found noncompliant and disenrolled,” said Michael Karpman, who researches health policy at Urban.

Nebraska plans to use data to help determine who qualifies

Not everyone who has coverage will need to submit proof that they’re working.

The state says it will first match enrollees with other data it has to see if participants are working or exempt. The state says it has that information for most of the roughly 70,000 people enrolled in Medicaid through the expansion.

That leaves between 20,000 and 28,000 who would have to provide more information, plus an average of 3,000 to 4,000 new enrollees each month.

At first, they will just need to show that they met the requirements in just one month of the previous 12. The time frame will shift to six months in 2027.

There’s some flexibility. For instance, instead of showing they work 80 hours in a month, someone could instead provide records that demonstrate they earned at least $580, the amount someone earning minimum wage would make in 80 hours.

People who don’t submit requested information within 30 days of being asked could have their applications denied or lose coverage they already have.

The change is causing worry and confusion

Bridgette Annable, who lives in southwest Nebraska, received a letter saying she must meet the work requirements or lose the benefits that pay for her insulin and diabetic supplies.

The 21-year-old mother now has a part-time job, despite being advised against it to protect her mental health. She’s worried about her ability to keep working.

“I am working 30 to 25 hours a week — as much as my employer can provide,” Annable said. “Although I call out of work often due to fibromyalgia pain and bipolar episodes that leave me too tired to leave the house. I have enough energy to take care of my daughter and do some cleaning, but that’s about it.”

Amy Behnke, the chief executive officer of the Health Center Association of Nebraska, said that staff members who help people enroll with Medicaid and their clients have a lot of questions, including some that the state hasn’t yet answered.

Some examples: Apprenticeship programs are supposed to count for work requirements, but does that apply only to those certified by the state’s labor department? There’s an exemption for people who travel to a hospital for care, but there’s not clarity on how far the journey must be.

KFF’s Tolbert noted that the state issued its 295-page list last week of conditions that could qualify someone as medically frail. “We don’t know if it’s a comprehensive list,” she said.

“The speed at which we are choosing to implement work requirements hasn’t left a lot of space for really meaningful communication,” Behnke said.

And Nebraska could have to make changes after the federal government provides guidance that is expected in June.

Mulvihill and Beck write for the Associated Press. Mulvihill reported from Haddonfield, N.J.