The challenges that California’s hospital field will face in the coming year have never been greater, as the massive federal health care cuts from the One Big Beautiful Bill Act begin to materialize.
According to projections, millions of Californians will lose their health care coverage, and tens of billions of dollars will be drained from California’s health care system. With nearly half of California hospitals already losing money every day caring for patients, hospitals will have to spend an estimated $2.6 billion annually to care for those with no health insurance.
That means hospitals will need meaningful support from the state to maintain — let alone expand — the services that Californians need and rely on. Last week, CHA’s Board of Trustees met to provide early advice on proposed state advocacy priorities for the coming year that, if successful, would take steps to sustain access to care and protect communities throughout California. Of course, CHA will continue to work on all the issues of concern to hospitals, but the Board provides guidance annually on those that rise to the very top of the list so we can allocate resources accordingly.
First, CHA will look to influence the direction of the Office of Health Care Affordability (OHCA), which continues to advance policies that ignore the realities of labor costs, regulatory burdens, pharmaceutical expenses, lifesaving treatment innovations, and more. These policies come at a time when health care providers in California have yet to absorb the impacts of the One Big Beautiful Bill Act, and OHCA policies will undoubtedly hamper access to care.
Second, with a 2030 deadline for all hospitals in California to comply with an “operational standard” for earthquakes, the clock is ticking. Hospitals are already safe from an earthquake — buildings will not fall or “pancake” — but the 2030 standard requires full operational capacity, or the hospitals will be forced by law to close. Without reform, that would mean hospitals closing after Dec. 31, 2029. CHA will be pursuing changes that prevent that from happening.
Third, as the financial headwinds for hospitals grow beyond their negative impact to date — in the past two years alone, there have been four announced bankruptcies, nine service line cuts, and more than 4,000 layoffs — hospitals will need additional resources to survive. CHA will look to the state for additional financial support and examine ways to reduce the cost of delivering care that do not create more budget pressure for state leaders.
Broadly, the Board supports these priorities, understanding that each is a significant undertaking in and of itself. The Board will formally approve an advocacy agenda in December, and these priorities could be revised and refined between now and then, but these three issues appear to be front and center.
As always, your association will be there to convene, support, guide, and lead as we advance these goals together. Stay tuned for the full state advocacy agenda — along with our suite of advocacy materials — once the CHA Board signs off.
