On October 15, 2025, the California Hospital Association (CHA) filed suit against the California Office of Health Care Affordability (OHCA) (and affiliated defendants) over claims that OHCA’s cost targets are arbitrary, irresponsible and single out hospitals, and will severely disrupt hospital services, starving hospitals of needed resources.  Starting January 1, 2026, OHCA will begin to enforce cost targets, limiting California hospitals so that total healthcare expenditures do not annually increase by more than 3.5% for most hospitals, and a limit of 1.8% for seven high-cost hospitals. By 2029, these targets drop to 3% and 1.6%, respectively.