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The California Legislature is concluding its 2025 regular session amid high-stakes negotiations on climate, healthcare, and budget policy, with proceedings extending into very early Saturday morning. As a reminder this is the first year in a two-year session. When they gavel down (likely in the early Saturday hours), all bills transmitted to the Governor will need to be acted on by October 12, 2025. ACHD continues to work on several high-priority measures, including recently introduced trailer bills, and will keep members appraised of the final actions.
Bills:
SB 7 – Employment: Automated Decision Systems- Assembly Floor
SB 7 (Sen. McNerney) addresses the use of automated decision systems (ADS), especially those powered by artificial intelligence, in employment practices. The bill prohibits employers from using such systems for certain employment decisions unless stringent transparency and fairness protections are met. – ACHD High Priority Oppose
SB 596 – Health Facilities: Nurse-to-Patient Ratios- Assembly Floor
SB 596 (Sen. Menjivar) adds a statutory definition for on-call list for the purposes of relief under the nurse-to-patient ration. ACHD, in collaboration with our Advocacy Committee and broader membership, were able to agree to amendments to remove our opposition. These amendments removed the 10% requirement, added in the use of float pools, and removed ambiguity on by unit or by hospital lists. – ACHD Neutral
SB 669 – Rural Hospitals: Standby Perinatal Services- Senate Concerns Vote
SB 669 (Sen. McGuire) establishes a five-year pilot program allowing small rural and critical access hospitals to operate standby perinatal (maternity and newborn) units. The bill was taken up on the Assembly floor on Tuesday and received a unanimous vote, 80-0. It now heads to the Senate for a concurrence vote. – ACHD High Priority Support
SB 29 – Permanent Recovery of Non-Economic Damages in Survival Actions- Assembly Floor
SB 29 (Sen. Laird) permanently removes limitations on the recovery of non-economic damages (such as pain and suffering) in survival actions following a decedent’s injury or death. Previously subject to a sunset, this legal change aligns California with national trends and is especially important for victims’ families in medical negligence and other personal injury cases. – ACHD High Priority Oppose
AB 339 – Local Public Employee Organizations: Notice Requirements - Governor’s Desk
AB 339 (Asm. Ortega) institutes clear, mandatory timelines for public agencies to notify employee organizations before contracting out work traditionally done by bargaining unit employees. Agencies must provide at least 45 days’ written notice before issuing RFPs or renewing contracts for such work, closing gaps that previously led to disputes over outsourcing and labor negotiations. - ACHD Oppose
AB 1331 – Workplace Surveillance Regulations – Senate Floor
AB 1331 (Asm. Elhawary) targets the expanding use of workplace surveillance technology by regulating how and where employers can monitor workers, both in public and private sectors. Surveillance in sensitive employee-only areas (like bathrooms and breakrooms) is generally prohibited, with exceptions for safety and security under strict conditions. The bill grants employees the right to be free from surveillance during off-duty hours and is widely supported by labor but opposed by employer groups. - ACHD Oppose
H.R. 1:
As Cathy mentioned in her message, in the wake of the passage of H.R.1 the legislature held two hearings to discuss the matter, preliminarily. ACHD monitored both hearings and will be engaging with the process as the legislature debates how to move forward amidst significant cuts, delays, and changes. The hearings highlighted that H.R. 1 will cut roughly $28 billion in Medicaid (Medi-Cal) funding to California, potentially causing up to 3.4 million residents to lose their health coverage. In addition, restrictions on how California raises its share of Medicaid funding will jeopardize vital revenue sources such as the Managed Care Organization (MCO) tax and the Hospital Quality Assurance Fee, which fund key safety-net healthcare providers. ACHD will be convening our H.R 1 subcommittee (ad hoc committee of the Advocacy committee) soon and will keep the membership updated. The California Budget Center has shared this document with ACHD, and will also be presenting at our Annual Meeting on September 25.
Senate & Assembly Health Joint Hearing
➠ Hearing Agenda
➠ Background Document
➠ DHCS Presentation
Assembly Budget Subcommittee #7
➠ Hearing Agenda
➠ Legislative Analyst's Office Handout on HR 1
➠ Assembly Budget Committee No. 7 Hearing
Rural Transformation Fund:
The federal Rural Transformation Fund, enacted as part of national budget reconciliation, creates a $50 billion, five-year program (2026–2030) to support and transform rural healthcare delivery. This Kaiser Family Foundation (KFF) summary does a good job of explaining the program.
The Department of Health Care Access & Information (HCAI) convened an informational webinar to share what they know from CMS, and the process they will be using to gather stakeholder information to submit for the Rural Health Transformation Program grants. Director Elizabeth Landsberg kicked it off and noted the Medicaid cuts included in HR 1 are formidable and so we need to think outside the box – cuts to coverage will be significant and so we must get together on new ways to support health care in rural areas and the Department looks forward to suggestions. States are required to submit plans by December 31, 2025 in order to access yearly funding (a baseline of $100 million plus further allocations depending on rural needs and capacity). The fund is not intended to backfill prior Medicaid/Medicare cuts, but to support hospitals, clinics, and health systems in building sustainable, modern rural care, including workforce and infrastructure investments. Stakeholder input and innovative rural care models are encouraged in the planning process.
The state cannot backfill the financial shortfall with this funding, it is simply not enough.
When submitting, consider where there are fewer resources, and where considerable resources have already been spent (example – Behavioral Health Transformation grants).
Important Links and Resources:
✴️ CMS RHTP Landing Page.
✴️ CMS Overview of RHTP - Aug 2025
✴️ HCAI - Office of Rural Health - RHTP page
Please note, definition of rural may be different per CMS, so the Notice of Funding Application will have more information about the metrics to be used. Per census data, there are 2.3 mil people living in rural census blocks. The focus will be on improving health outcomes, so HCAI will be checking in with DMHC and DHCS about timely access and network adequacy as part of the application.
This is high priority for ACHD, and we are engaging with HCAI, the Administration and key stakeholders. ACHD will be convening our H.R. 1 working group on the matter as well as a sub-set of our rural members.
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