The Weekly Articles

On October 7, 2025, Governor Newsom signed AB 1312, which requires hospitals to screen patients for eligibility under the hospitals’ charity care and discount payment policies before sending patients their first billing statement. The legislation goes into effect on July 1, 2027. The law creates presumptive eligibility where a patient or family member is enrolled in specified means-tested programs (e.g., CalFresh, CalWORKs, WIC, CARE, LIHEAP, HCV) or is experiencing homelessness, and it prohibits requiring patients to apply for Medicare, Medi-Cal, or other coverage prior to screening. Hospitals must notify patients of the screening, offer a signed opt-out form, and ensure any first bill reflects adjustments made under the hospital’s policies.

The new legislation also requires hospitals to add a compliant, written screening process to their charity care and financial assistance policies, post it publicly, and submit it to the California Department of Health Care Access and Information. While many hospitals, especially nonprofit hospitals, will already meet many of the requirements the new legislation imposes, hospital counsel should review AB 1312 against their clients’ current policies and practices to ensure compliance.

Governor Newsom signed two bills to address the influence of private equity groups and hedge funds in health care. The first, Senate Bill 351, by Senator Cabaldon, codifies existing regulatory guidance regarding the ban on the corporate practice of medicine, and grants the Attorney General express enforcement authority for violations of the statute. The enacted bill prohibits private equity or hedge fund interference with the professional judgment of physicians or dentists in making health care decisions, as well as the exercise of control or delegation of power over specified aspects of a medical or dental practice. SB 351 was a pared-down iteration of Assembly Bill 3129 (2024), a bill that sought to grant the Attorney General approval authority over private equity and hedge fund transactions involving certain health care entities, and was vetoed by the Governor due concerns about perceived regulatory overlap with the Office of Health Care Affordability (OHCA).

The second, AB 1415, by Assembly Member Bonta, expands the authority of OHCA to require notices of material change transactions involving private equity groups, hedge funds, or management services organizations (MSOs). Existing law authorizes OHCA to require notices of transactions between two or more health care entities, as defined. AB 1415 expands that authority to include transactions between a private equity group, hedge fund, or MSO, on one hand, and a health care entity or another MSO, on the other. The enacted bill also authorizes OHCA to establish data reporting requirements for MSOs. OHCA is expected to undertake rulemaking to implement its expanded authorities using its statutory emergency rulemaking authority, which would provide truncated public comment and review timelines.

Both laws take effect January 1, 2026. More detailed discussions of SB 351, AB 1415, and last year’s AB 3129, are available in the Watching articles from September 30, 2025 and March 11, 2025.

California’s Assembly Bill 894 (AB 894), authored by Assemblymember Juan Carrillo, enhances patient privacy rights by regulating how hospitals manage internal patient directories. Beginning July 1, 2026, general acute care hospitals will be required to inform patients—or their representatives—at the time of admission, or as soon as reasonably possible in emergencies, that they have the right to restrict or prohibit disclosure of certain protected health information included in the hospital’s directory. The bill adds Health and Safety Code § 1275.9, which mandates that hospitals provide a separate acknowledgment form, either paper or digital, containing only the privacy practices notice and directory information, with a clear checkbox allowing patients to opt out of disclosure. In addition to written notice, hospital personnel must verbally inform patients of their directory rights.

AB 260 (Sexual and reproductive health care)

On September 26th, Governor Newsom signed AB 260 into law, which includes a series of protections for patients and providers in the context of reproductive health services. Among other things, AB 260 provides for the following:

• Anonymous Abortion Prescriptions: Pharmacists are permitted to dispense abortion medications without including the provider name, the patient’s name, or pharmacy details on the label.
• Insurance Coverage: California-regulated health plans are required to cover abortion drugs like mifepristone, even if federal approval status changes.
• Legal Protections for Providers: The new law shields California health care providers from criminal prosecution or civil lawsuits related to prescribing abortion medication, especially from out-of-state legal actions.

AB 260 complements the slate of reproductive health related bills passed in previous legislative sessions, including AB 2091, which prohibits the sharing of patient medical records with abortion related care information in response to subpoenas from out of state entities.

AB 1525 (Attorneys: discipline: sensitive services)

Governor Newsom also signed into law AB 1525, which protects attorneys providing legal services related to certain defined sensitive services from California State Bar discipline. Specifically, AB 1525:  

• Protects Attorneys from Out-of-State Discipline: Lawyers practicing in California cannot be disciplined by the State Bar for providing accurate legal advice about sensitive services that are lawful in California—even if those services are illegal in another state. As defined in existing state law, “sensitive services” include care related to mental and behavioral health, sexual and reproductive health, sexually transmitted infections, substance use disorders, gender-affirming care, and intimate partner violence.
• Shields Applicants to the Bar: An application to the California Bar cannot be denied based on disciplinary actions taken against the applicant in other states for supporting sensitive services that are legal in California.
• Limits Reporting Requirements: Attorneys and applicants are not required to report out-of-state disciplinary actions if they stem from laws that conflict with California’s protections for the provision of legal advice about sensitive services.

The battle to address the role of private equity in healthcare continues in the State Legislature, this time in the form of AB 1415. Like last year’s AB 3129, which Governor Newsom vetoed, AB 1415 seeks to bring certain private equity and hedge fund activities under the review of California’s executive branch. This time, however, the Legislature proposes doing so by working within the already established framework of OHCA and expanding OHCA’s jurisdiction.

Readers may recall last year’s AB 3129 proposed broad oversight of private equity and hedge fund investments in healthcare. Specifically, AB 3129 aimed to regulate private equity and hedge fund acquisitions or change-of-control in health care facilities, provider groups, and other entities. The bill proposed achieving this in part through a review and approval process overseen by the California Attorney General, including the authority to approve, deny, or conditionally approve proposed transactions provided the parties conformed to proposed changes by the Attorney General. In other words, AB 3129 contemplated empowering the Attorney General with strong oversight authority to amend or even stop proposed healthcare transactions involving private equity and hedge funds.

Despite passage by both houses of the Legislature, the Governor vetoed AB 3129, indicating concerns over duplication of the role of the Office of Health Care Affordability (OHCA) in healthcare transaction review. Earlier this year, however, the Legislature tried again, this time in the form of AB 1415, seeking to carry on—in some way—where AB 3129 was stopped short.

AB 1415 proposes to once again regulate private equity and hedge fund activities in the healthcare space, but this time proposes to do so through the existing OHCA framework. The bill proposes to do this first by amending Health & Safety Code section 127500.2 to include broad definitions for the terms “hedge fund,” “management services organization,” and “private equity.” The inclusion of these definitions effectively expands OHCA’s jurisdiction to ensure these newly defined entities will be subject to its transaction-notice and review processes.

This is where AB 1415’s second major change would come in. In addition to expanding OHCA’s jurisdiction to cover new entities in the transaction-notice process, AB 1415 proposes amendments to that process that would cast a wider net and more stringent reporting requirements. Under the proposed language, the transaction-notice requirements would expand to mandate disclosures not just by the noticing entity but also by the healthcare entity or management services organization involved in the transaction, or any entity that owns or controls them, as well as disclosures by a management services organization in any transaction or agreement between it and any other entity.

In other words, AB 1415 can be viewed and described as a compromise bill. It marks another attempt by the Legislature to bring transparency to healthcare transactions by regulating entities still outside of OHCA’s purview and expands the reach of the disclosure process required by OHCA, but it also does not include the veto power or ability to block transactions that AB 3129 would have created. It also does not subject stakeholders to review by another executive branch entity (i.e., the Attorney General). Instead, the bill appears to respond to the Governor’s stated concerns and proposes consolidating and expanding OHCA’s authority rather than creating a separate track for these kinds of transactions.

The Legislature enrolled and presented the bill to the Governor on September 15, 2025, where it waits for either the Governor’s signature or veto. If signed into law, it will mark a significant change for private equity groups, hedge funds, and MSOs engaged in transactions in California, and will expand OHCA’s already important role in the healthcare industry.

Are you passionate about health law and enjoy writing or editing? CSHA's Publications Committee, which produces the quarterly California Health Law News and the Weekly member updates, is now accepting applications for new members. This is a great opportunity to contribute to CSHA’s thought leadership and stay engaged with key developments in the field. Please email co-editors Andrea Frey (afrey@hooperlundy.com) and Kate Broderick (katherine.broderick@providence.org) if you are interested in applying to join the committee. 

In response to significant shifts in federal health care policy—particularly at the Centers for Disease Control and Prevention (CDC)—several states have taken steps to maintain broad access to immunizations. California is among them.

The state’s health officials have expressed concern over declining childhood vaccination rates, citing 20 confirmed measles cases in 2025. To address this trend, California has joined forces with Oregon, Washington, and Hawaii to form the West Coast Health Alliance (WCHA). The coalition aims to provide clear, evidence-based vaccine guidance and counter misinformation about vaccines, including recommending that states follow the CDC’s previous vaccine schedule in effect as of January 1, 2025.

In addition to forming the WCHA, Governor Newsom signed Assembly Bill 144 on September 17, 2025, which, among other provisions, amends Health & Safety Code section 1342.2 to ensure Covid-19 testing and treatment remain covered in California. The legislation also amends Health & Safety Code section 1367.002 to establish the CDC schedule in place on January 1, 2025 as the baseline for vaccine coverage, and payment for childhood vaccines.

Information about vaccines and coverage in the state can be found on the California Department of Public Health (CDPH)’s website.

Senate Bill 81 (“SB 81”), which seeks to address immigration enforcement in the health care setting, has been sent to Governor Gavin Newsom’s desk. Amongst other provisions, SB 81 would treat patients’ immigration status as medical information for purposes of state privacy law and would require health care provider entities to establish nonpublic areas inaccessible for immigration enforcement purposes, subject to limited exceptions.

Key elements of SB 81 include the following:

• Amendments to the California Confidentiality of Medical Information Act (“CMIA”)
  • The definition of “medical information” under the CMIA is amended to include “individually identifying information regarding immigration status, including current and prior immigration status, or place of birth,” if collected in electronic or physical form by a health care provider or health care service plan.
  • Health care providers and health care service plans are prohibited from disclosing medical information for immigration enforcement, except to the extent (1) expressly authorized by the patient, (2) required per Civil Code Section 56.10(b) (CMIA’s mandatory disclosure provision), or (3) permitted per Civil Code Section 56.10(c) (CMIA’s permissive disclosure provision).
• Visitor Access
  • To the extent possible, a “health care provider entity”—defined to include hospitals, clinics, physician organizations, integrated health care delivery systems, and other health care providers—must establish or amend procedures for monitoring, documenting, and receiving visitors.
  • Health care provider entities are encouraged to post a “notice to authorities” at facility entrances.
• Immigration Enforcement Requests
  • Health care provider entity staff must immediately notify management, administration, or legal counsel of any request for access to the site or a patient for immigration enforcement purposes.
  • Health care provider entity staff must immediately provide any document review requests—including through a lawfully issued subpoena, warrant, or court order—to management, administration, or legal counsel.
  • If a request is made to access a health care provider entity site or patient for immigration enforcement purposes, staff must direct that request to management, administration, or legal counsel.
• Designation of Nonpublic Areas
  • A health care provider entity must designate as nonpublic areas where patients are receiving treatment or care, or where a patient is discussing protected health information.
  • Unless required by state or federal law, a health care provider entity may not allow any person access to designated nonpublic areas for immigration enforcement purposes, unless that person has a valid judicial warrant or court order that specifically grants access to the nonpublic areas.

Governor Newsom has until October 12, 2025 to take action on SB 81. If signed into law, SB 81 would go into immediate effect and health care provider entities would have 45 days from the effective date to comply with the visitor access, immigration enforcement requests, and designation of nonpublic areas requirements summarized above.

A recent California court of appeals decision, Hirdman v. Charter Communications, LLC, provides guidance on calculating paid sick leave for exempt employees who are not paid a salary, including physicians paid on an hourly basis. (2025) 113 Cal.App.5th 376.  California’s mandatory paid sick leave law, Labor Code section 245 et seq., requires employers to provide paid sick leave to employees to be used for their own illnesses and doctor’s appointments, those of certain family members and “designated persons,” and other covered absences.  The law contains two clear methods of calculating paid sick leave for non-exempt employees.  The paid sick leave can be calculated using the method to calculate the regular rate of pay to calculate overtime.  Labor Code § 246(l)(1).  Alternatively, paid sick leave for non-exempt employees can be calculated by dividing the employee’s total wages, not including overtime premium pay, by the total hours worked in full pay periods in the prior 90 days of employment.  Labor Code § 246(l)(2).

However, as to exempt employees, the law only states that paid sick leave “shall be calculated in the same manner as the employer calculates wages for other forms of paid leave time.”  Labor Code § 246(l)(3).  This became an issue when the Division of Labor Standards Enforcement (“DLSE”) issued an Opinion Letter concluding that this only applied to salaried exempt employees meeting the executive, administrative or professional exemptions.  DLSE OL 2016-10-11.  The Opinion Letter involved an employee classified as exempt based on the outside sales exemption.  According to the DLSE, the definition of an “exempt” employee under Labor Code section 246(k) only applied to employees who met both the salary and duties test of Labor Code section 515.  Since outside salespeople were not paid a salary, paid sick leave had to be calculated based on one of the methods used for non-exempt employees.

The Hirdman case also involved an outside sales employee, who brought a Private Attorneys General Act case based on his employer’s failure to calculate paid sick leave under one of the non-exempt options.  According to the court of appeal, the commonly understood definition of exempt employee is those who are not entitled to overtime.  If the legislature had intended to limit the definition used in Labor Code section 246 to only employees meeting the administrative, executive or professional exemptions, it would have said so.

This holding applies to exempt physicians who are compensated on an hourly rather than salary basis as permitted under the Labor Code.  Paid sick leave for these physicians may be calculated in the same manner as the employer calculates wages for other forms of paid leave time, for example, based on their base hourly rate, excluding additional premium or production pay.

As previously reported in the Weekly Watching last November, when Governor Newsom vetoed AB 2467 relating to perimenopause and menopause care last year, he instructed the Legislature to continue to work on the subject with a view toward a more tailored solution. That led to the introduction of two bills this legislative session, AB 360 and AB 432. 

AB 360 requires assessment of physician education and training regarding menopause diagnosis and management. Studies demonstrate that only a small percentage of women experiencing perimenopause and menopause receive evidence-based treatment. Studies also demonstrate many physicians lack sufficient formal training regarding menopause, and thus it is often a condition that is unrecognized or even misdiagnosed due to the wide range of symptoms that may occur. In an effort to identify and bridge the education and practice gaps, AB 360 would require the Department of Health Care Access and Information (HCAI) to work with the Medical Board of California, the Osteopathic Medical Board of California, and state higher education authorities to assess physician training on menopause diagnosis and treatment and related trends in practice. HCAI would then be required to report to the Legislature on or before January 1, 2027, regarding any gaps in medical education and training related to menopause and make recommendations. However, the bill was tabled earlier this summer.

AB 432, as originally introduced, targeted two issues: education regarding menopause and insurance coverage of treatment options. With regard to education, the bill would have placed requirements around medical education on perimenopause or menopause for physicians who treat a significant female population. With regard to insurance coverage, it sought to require coverage for evaluation and treatment options for perimenopause and menopause. After several amendments, however, the latest version instead proposes deleting existing law’s requirement of the Medical Board to consider including a course on menopausal mental or physical health in the continuing education of licensees, and instead incentivizing licensees by requiring that, beginning July 1, 2026, licensees who complete CME courses in perimenopause, menopause, and postmenopausal care receive two hours of credit for each hour of coursework completed (limited to eight hours total).  Additionally, while the bill originally sought to require healthcare service plan contracts or policies issued on or after January 1, 2026, to include coverage for evaluation and treatment options for perimenopause and menopause, the latest version limits its application to contracts or policies that cover outpatient prescription drugs, mandating such contracts include coverage for evaluation and treatment options for symptoms of perimenopause and menopause. It would also require such healthcare service plans to annually provide current clinical care recommendations for hormone therapy to providers who treat enrollees with perimenopause and menopause. Committee motions to advance AB 432 have passed, and the bill has been returned to second reading, as amended.