AB 1415 strengthens California’s Office of Health Care Affordability to monitor private equity and hedge fund acquisitions of hospitals and medical providers.
- Daniel McGreevy
- Communications Coordinator
- (916) 319-2589
- Daniel.McGreevy@asm.ca.gov
SACRAMENTO – Today, Governor Newsom signed AB 1415, authored by Assemblymember Mia Bonta (D-Oakland), Chair of the Assembly Health Committee, strengthening the ability of the Office of Health Care Affordability (OHCA) to analyze healthcare spending and help lower costs for working-class Californians. As Californians face rising healthcare costs and increasing private equity takeovers of hospitals and clinics, AB 1415 expands OHCA’s authority to review and oversee major transactions in the healthcare sector.
Specifically, the new law requires private equity groups, hedge funds, and Management Services Organizations (MSOs) to notify OHCA when they undertake major transactions, including mergers or acquisitions, involving hospitals, physician organizations, skilled nursing facilities, or other MSOs.
“Californians deserve a full picture of the billions spent annually in our health care system by large private equity firms. AB 1415 ensures that our Office of Health Care Affordability has the authority to monitor these transactions and protect patients from rising costs and reduced access to care,” said Assemblymember Mia Bonta. “Access to affordable, high-quality care is essential for Californians across the state, and I’m proud to see this bill signed into law to deliver on that promise.”
The Office of Health Care Affordability was created in 2022 to tackle the health care affordability crisis facing Californians, as health care costs continuously surpass inflation and strain working families’ budgets. OHCA gathers and examines data on health care spending, promotes strategies to improve affordability, quality, and equity in health care; enforces cost-growth benchmarks for the state; and reviews health care transactions to assess their impact on competition, prices, access, quality, and equity.
AB 1415 was supported by organized labor, nurses, and health advocates to control healthcare costs and safeguard patients’ care amid rising consolidation:
Private equity acquisitions of health care providers in California totaled $4.31 billion between 2019 and 2023, accounting for one-third of the state’s health care deals.
The share of community hospitals owned by a larger health entity increased from 53% in 2004 to 68% in 2022.
Doctors working in a hospital or practice partially owned by another hospital or healthcare system went from 29% in 2012 to 41% in 2022.
Research shows that as market consolidation rises, so do prices. Over the past decade, hospital mergers have steadily increased often leading to service reductions or closures as profits are prioritized over community needs.
“By signing AB 1415 today, Governor Newsom has better ensured that consumers and the state understand the impacts of private equity deals in health care on our communities and health care system,” said Katie Van Deynze, Senior Policy and Legislative Advocate for Health Access CA. "California's Office of Health Care Affordability now has the needed authority to fully review private equity mergers in health care for potential harm to consumers. Private equity groups often treat our hospitals and doctors' offices like any other asset, maximizing profits for their investors at the expense of patients' access and ability to afford care. This new law will ensure that communities have the full picture of these transactions before they happen, what it means for their health care, and hold the new owners accountable to promises made about benefits for the community."
AB 1415 goes into effect on January 1st, 2026.
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Assemblymember Mia Bonta represents California’s 18th Assembly District encompassing the East Bay including Oakland, Alameda, and Emeryville. She also chairs the Assembly Health Committee.
Courtesy photos can be found HERE.