STATE BUDGET

The state has an annual budget cycle, with the fiscal year beginning July 1.  Agencies submit budget requests to the Governor in September, and the Governor submits a proposed budget to the legislature in January.  The legislature adopts a budget in June.  The Governor is required to submit a balanced budget, and the legislature is required to adopt a balanced budget.

STATE LEGISLATURE

The California state legislature consists of the California State Assembly, with 80 members, and the California State Senate, with 40 members.  California has term limits allowing legislators to serve only 12 years total.  The California State Legislature is one of only ten full-time state legislatures in the United States.  Bills carry over from odd to even years.

KEY RESOURCES

• California Legislature
• California Governor
• California Attorney General
• California Health Care Cost Transparency Database

CALIFORNIA KEY CASES

California Hospital Association vs. Office of Health Care Affordability, et al.
The California Hospital Association filed this case on October 15, 2025, and is challenging the California Office of Health Care Affordability’s 2026 hospital cost targets, claiming that they are arbitrary, irresponsible and single out hospitals, and will severely disrupt hospital services.

UFCW & Employers Benefit Trust v. Sutter Health
This class action suit by employers and labor unions, filed on April 7, 2014, accused Northern California health system Sutter of abusing its market power to charge inflated prices, in violation of California’s antitrust law.

Sidibe v. Sutter Health
The class action of individuals and employers who purchased insurance plans in California, filed on September 17, 2012, alleges that Sutter Health used provisions in its contracts with health plans to create healthcare monopolies and charge above-market prices, which were passed on by the plans to consumers.

2025 LEGISLATIVE SUMMARY

California passed SB351 which codifies restrictions on private equity and hedge fund groups engaging in the corporate practice of medicine. The groups are prohibited from patient assessment and treatment, and administrative work. California also enacted AB1415 expanding reporting requirements, with healthcare entities being required to give written notice to the Office of Health Care Affordability about significant agreements or transactions involving material changes in assets, ownership, or control. The bill also expands the Office’s ability to study the impact on cost, quality, and workforce of various healthcare entities and includes new definitions of hedge fund and management services organization.