SB 173 California Senate · 2025-2026 Regular Session

Health.

SB 173, the "Budget Act of 2025," is a procedural bill that formally expresses the Legislature's intent to enact future statutory changes related to the state's budget process. It does not make specific policy changes or allocate funds itself - it simply states the Legislature’s future goal to revise the Budget Act of 2025. The bill was passed by the Senate on March 20, 2025, and referred to the Assembly for further consideration. This type of bill typically precedes more detailed budget legislation but has no immediate effect on state budgets or programs.
Bill status passed 3 of 5 stages cleared
Introduction
Jan 2025
Committee Review
Mar 2025
Senate Passage
Mar 2025
Assembly Passage
Governor
Introduced Jan 23, 2025 Last action Aug 30, 2026
Maddy AI version diff · 2 comparisons

What changed between versions

01/23/25 - Introduced 08/28/26 - Amended Assembly · 13 edits · Aug 28, 2026
MAJOR
SB 173 was expanded from a one-line placeholder expressing legislative intent regarding the Budget Act of 2025 into a comprehensive health-related omnibus bill covering Medi-Cal provider fraud prevention, 988 Suicide and Crisis Lifeline system implementation, non-citizen Medi-Cal eligibility restructuring, Palomar Health District asset transfer, and multiple other health policy provisions. The amendment adds appropriations totaling approximately $112.8 million from the Federal Trust Fund and makes the bill a state-mandated local program with fiscal committee review required.
Scope change
The bill's scope expanded from a single-section placeholder expressing legislative intent to a comprehensive omnibus health bill amending four different codes (Government Code, Health and Safety Code, Revenue and Taxation Code, Welfare and Institutions Code) across at least 13 distinct policy areas including Medi-Cal administration, 988 crisis services, non-citizen eligibility, hospital regulation, and a special act for Palomar Health District. It also changed from having no appropriation to appropriating approximately $112.8 million, and from not being a state-mandated local program to potentially imposing one.
SCOPE

The bill was transformed from a single-section placeholder into a multi-code omnibus amending Government Code, Health and Safety Code, Revenue and Taxation Code, and Welfare and Institutions Code provisions across at least 13 distinct policy areas.

Palomar Health District: Authorizes transfer of district assets to Palomar UC San Diego Health Authority with conditions including a 10-year covenant to operate for health care services, retroactive application to board approvals on or after January 1, 2025, and expiration if no agreement is executed by December 31, 2028.

REQUIREMENT

Medi-Cal provider enrollment: Requires DHCS to deny or terminate provider enrollment if the applicant has an affiliation within the previous 5 years with a person or entity that experienced a disclosable event, if the department determines the affiliation poses an undue risk of fraud, waste, or abuse. Also makes temporary suspension effective on the date notification is sent rather than 15 days later.

988 Suicide and Crisis Lifeline: Establishes a designated 988 center approval process (DHCS to establish by October 1, 2027), requires all 988 centers to obtain designation by December 31, 2029 or lose funding, extends advisory group meetings through December 31, 2029, requires an interoperable solution between 988 and 911 by December 31, 2029, and creates a 988 System Governance Board until January 1, 2030.

988 funding: Requires DHCS to develop a two-year statewide funding estimate for 988 centers and designated 988 centers, requires annual expenditure/revenues/outcomes reports from fund recipients with DHCS approval or denial authority, and specifies that surcharge revenue supplements rather than supplants other funding sources.

Nurse-to-patient ratio penalties: Extends the existing penalty exemption (for demonstrating prompt efforts to maintain staffing levels) from general acute care hospitals to acute psychiatric hospitals.

LGBTQ+ suicide prevention: Requires the agency to annually determine whether an adequate specialized LGBTQ+ suicide prevention hotline is activated under 988, authorizes requesting SAMHSA approval for a state-level press 3 routing function, and requires contracting with qualified entities specializing in LGBTQ+ suicide prevention within 12 months of SAMHSA approval.

CBAS center closures: Requires DHCS and the Department of Aging to collaborate with certain entities to understand Community-Based Adult Services center closures and requires a report to the Legislature and Legislative Analyst's Office by March 1, 2029.

ELIGIBILITY

Non-citizen Medi-Cal eligibility restructured: Beginning October 1, 2026, individuals with specified immigration status are only eligible for full-scope Medi-Cal if they meet certain criteria. Through June 30, 2027, those not described in certain federal provisions remain eligible for full-scope state-funded benefits. Pregnant individuals and those entitled to postpartum care are exempt from dental service limitations.

Maintenance dialysis: Effective October 1, 2026, medically necessary maintenance dialysis for chronic dialysis and end-stage renal disease becomes a covered service under restricted-scope Medi-Cal regardless of whether it meets the emergency medical condition definition, with state funding required where federal financial participation is unavailable.

FISCAL

Appropriates $105,611,000, $5,975,000, and $1,229,000 from the Federal Trust Fund to DHCS for State Opioid Response Grant and Substance Abuse Prevention and Treatment Block Grant funds, available through June 30, 2027.

DEFINITION

Adds new definitions in Government Code Section 53123.1.5 for 988, 988 center, designated 988 center, behavioral health crisis services, interoperable solution, mobile crisis team, and other terms supporting the 988 system framework.

ENFORCEMENT

Medi-Cal provider moratorium: Removes the existing exception that allowed certain clinics, health facilities, or licensed natural persons to be exempt from a 180-day enrollment moratorium, and requires written notice to the Joint Legislative Budget Committee with renewal every 180 days.

Floor votes · Senate Mar 20, 2025

How they voted

2810
Passed · 2 other
Total votes 40
Mar 20, 2025
D Democratic30
28 Yea 2
93% Yea
R Republican10
10 Nay
100% Nay
Vote distribution
All Yea All Nay Mixed No data
Full legislative history

Actions timeline

Total actions
12
Key actions
2
Committee
2
Amendments
1
Aug 28, 2026
Lower · Passed
From committee with author's amendments. Read second time and amended. Re-referred to Com. on BUDGET.
lower
Mar 24, 2025
Committee
Referred to Com. on BUDGET.
lower
Mar 20, 2025
Upper · Passed
Read third time. Passed. (Ayes 28. Noes 10. Page 454.) Ordered to the Assembly.
upper
Feb 5, 2025
Committee
Referred to Com. on B. & F. R.
upper
Jan 23, 2025
Introduced
Introduced. Read first time. To Com. on RLS. for assignment. To print.
upper
0 primary · 0 co-sponsors

Sponsors

No sponsor information available.