Health bills on Newsom’s desk

Gov. Gavin Newsom has until Oct. 12 to approve or veto these measures.

Making prescription drugs more affordable

Rising drug costs are one of the leading drivers of increased health spending. Between 2022 and 2023, the most recent year state data is available, spending on prescription drugs increased by nearly 11%.

That’s part of why state lawmakers are trying to make prescription drugs cheaper for consumers by limiting out-of-pocket costs and cracking down on companies that control prescription drug benefits.

Newsom vetoed a proposal to cap insulin costs two years ago, pointing to a $100 million state initiative to manufacture low-cost insulin instead. But with that project — named CalRx — yet to produce any insulin, lawmakers returned with a new push to bring immediate relief to diabetes patients.

Reintroduced this year by Sen. Scott Wiener, Senate Bill 40, which passed unanimously in the Senate and Assembly, would cap monthly out-of-pocket spending on insulin at $35. It’s a life-saving drug, but its high cost, which can be hundreds of dollars per month, can lead patients to skip doses and ration medication.

Wiener said he brought this measure back in the hopes of helping patients find financial relief as soon as January. “Whatever happens with CalRx is not mutually exclusive with the goal of capping (out-of-pocket) costs for insulin,” he said.

Wiener focused a lot of attention on prescription drug costs this year. Another of his measures, Senate Bill 41, would create some of the strongest regulations in the country for pharmacy benefit managers.

Pharmacy benefit managers serve as intermediaries between health insurance companies and drug manufacturers. They manage claims, negotiate the price of drugs under a complex system of rebates, and control the list of prescription drugs that insurers will cover.

In California, they’ve gone largely unregulated.

Wiener’s proposal would prohibit pharmacy benefit managers from “steering” patients to specific pharmacies or charging patients more for a drug than they reimburse the pharmacy. It would also, among other regulations, require them to pass all savings negotiated with drug manufacturers on to patients.

Opponents of the measure argue that it would prevent pharmacy benefit managers from effectively negotiating lower drug costs with manufacturers and will cost the state billions of dollars. They also contend that enough regulation was inserted into a budget deal Newsom made in May requiring pharmacy benefit managers to be licensed by the state and note that the state finance department is opposed.

“Californians simply cannot afford policies like SB 41 that would enrich pharmaceutical manufacturers by raising costs across the state’s patients and small businesses,” according to an unsigned statement from the Pharmaceutical Reform Alliance, a group that blames price increases on drug manufacturers.

Helping Californians with timely access and hospital bills

Thousands of Californians struggle with health care delays and unpaid bills each year. Health advocates say these issues cause many people to wait in limbo while their condition deteriorates or forgo health care altogether.

One of the reasons for delays is prior authorization, a process in which medical providers must get approval from health insurance before they can provide a service or dispense medication. Insurers say prior authorization is needed to keep health spending down by preventing people from getting unnecessary or duplicative services, but doctors and patients criticize it because it can delay care. 

Two Democrats, Sen. Josh Becker from Menlo Park and Assemblymember John Harabedian from Pasadena, want to make it easier for patients to get the care recommended by their doctors without waiting for insurance to weigh in. 

Becker introduced Senate Bill 306, a measure that would eliminate prior authorization requirements for treatments that health insurance plans approve 90% of the time. Harabedian’s measure, Assembly Bill 512, would speed up the process by shortening the time health insurers have to respond to prior authorization requests. Insurers would have to make decisions for requests made electronically within three days for standard requests and 24 hours for urgent ones. 

“Doctors should be spending their time with patients — not drowning in paperwork for treatments that nearly always get approved anyway,” Becker said in a statement earlier this year.

The state’s doctor lobby sponsored both bills. Meanwhile, health insurers opposed them, arguing that current prior authorization rules are necessary for safe and cost-effective care. 

Lawmakers also voted for legislation that aims to make it easier for patients to receive financial assistance from hospitals.

Research has shown that many patients do not know about or do not apply to hospital charity care programs even though they may qualify. Assembly Bill 1312 by Assemblymember Pilar Schiavo, a Santa Clarita Democrat, requires hospitals to check whether patients are eligible for financial assistance or discounted payments before sending them a bill. 

Under the proposal, hospitals would have to presume that people who are enrolled in means-tested programs, such as food stamps and cash assistance, are eligible for financial aid, along with people who are experiencing homelessness. Hospitals would have to proactively screen patients for charity care eligibility if they are uninsured, enrolled in Medi-Cal or in a Covered California health plan. 

If signed, the bill would take effect in 2027.

Protecting sensitive medical information 

As the Trump administration pushes the limits on immigration enforcement and pushes norms on abortion restrictions, California lawmakers are seeking to boost privacy protections for sensitive medical information. 

Sen. Jesse Arreguín, a Berkeley Democrat, sought to add protections for immigrants in medical facilities. His bill came as incidents where immigration agents showed up at hospitals raised questions and confusion, as well as fear among patients and health workers.

Senate Bill 81 would require hospitals and clinics to designate “nonpublic spaces” in their facilities and restrict immigration agents from entering those spaces unless agents can present a judicial warrant. The Fourth Amendment already protects people from unreasonable searches in places where they can expect privacy, such as a medical exam room. If signed, this bill would add a state-level layer of protection. 

“This legislation is urgent and necessary,” Arreguín said in August. “No one should have to choose between seeking medical care and fearing detention or deportation.”

Lawmakers are also attempting to safeguard abortion information after Texas and other states that heavily restrict or ban abortion enacted laws allowing their residents to sue out-of-state abortion providers.

Already doctors in California and New York have been sued for providing abortion medication to residents in states where the procedure is not allowed.

If signed, a bill authored by Assembly Majority Leader Cecilia Aguiar-Curry would allow doctors, pharmacists and other authorized prescribers to prescribe abortion pills without putting their names or the patient’s name on the prescription label. The Davis Democrat’s measure aims to create an added level of legal protection for abortion providers in California during a time marked by conflicting inter-state laws.

In a statement, Aguiar-Curry said the proposal “is about making sure Californians can get the care they need without fear or politics getting in the way.”

CalMatters.org is a nonprofit, nonpartisan media venture explaining California policies and politics.