SB 32 directs three California agencies—the Department of Managed Health Care (DMHC), the Department of Insurance (DOI), and the State Department of Health Care Services (DHCS)—to develop and adopt standards that govern geographic (time and distance) access to perinatal units so enrollees and insureds can obtain timely pregnancy‑related and neonatal care. The standards must be developed through interagency consultation and stakeholder input and reference the regulatory definition of “perinatal unit.”
The measure creates a temporary, aligned framework tying private insurance and plan requirements to the benchmark set for Medi‑Cal managed care by county type. It also builds in administrative flexibility (waivers/exceptions) and a repeal/sunset schedule, making this a defined, near‑term policy experiment on geographic access for maternal and newborn services.
At a Glance
What It Does
Requires DMHC, DOI, and DHCS to adopt time‑and‑distance access standards for perinatal units, with standards for insurers and plans no longer in time or distance than those used for Medi‑Cal managed care by county type. The rules must be developed in consultation with specified stakeholders.
Who It Affects
Managed care plans regulated by DMHC, regulated insurers overseen by DOI, hospitals that operate perinatal units, and pregnant enrollees/insureds—particularly those in rural and underserved counties where perinatal services are sparse.
Why It Matters
Aligns private‑sector network adequacy for perinatal care with Medi‑Cal benchmarks and makes geographic access a discrete regulatory target. The bill contains a July 1, 2027 adoption deadline and a built‑in sunset—the standards become inoperative July 1, 2033 and are repealed January 1, 2034—so affected parties must decide quickly whether to change networks, capacity, or contracting practices.
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What This Bill Actually Does
SB 32 creates three parallel, temporary rulemaking duties: DMHC must adopt geographic access standards applicable to health plans that provide or arrange physician and hospital services; DOI must adopt matching standards for insurers; and DHCS must adopt time‑and‑distance standards for Medi‑Cal managed care that serve as the benchmark. Each statute added to the Health and Safety, Insurance, and Welfare and Institutions Codes requires interagency coordination and consultation with a named set of stakeholders, including ACOG, the California Hospital Association, consumer representatives, labor, and clinicians who provide pediatric and pregnancy‑related care.
The bills reference the regulatory definition of “perinatal unit” in Title 22, section 70545, so the standard applies to units already recognized in hospital licensing rules rather than creating a new clinical definition. The text gives regulators two types of flexibility: DMHC may authorize alternative access standards or issue waivers under existing authority; DOI may issue exceptions for insurers.
That creates a deliberate structure for temporary deviation where meeting the standard is impracticable, but it leaves the mechanics of exceptions and waivers to agency rulemaking.Procedurally, each department must complete rulemaking by the statutory target, and the new sections include an express sunset so the standardized regime is explicitly temporary. The statute does not appropriate money to expand hospital capacity or workforce; it focuses on regulatory requirements for network design and availability.
Finally, because violations of DMHC‑enforced standards fall within the Knox‑Keene framework, the bill folds perinatal access into an existing enforcement regime that includes administrative penalties and, for willful violations of the Knox‑Keene Act, potential criminal exposure.
The Five Things You Need to Know
The departments must complete and adopt geographic (time‑and‑distance) standards for perinatal units by July 1, 2027.
The standards for insurers and plans must be no longer in time or distance than the Medi‑Cal managed care standards established by county type under Section 14197.03.
DMHC may authorize alternative access standards or issue waivers under its existing authority (cross‑referencing Section 1367.03); DOI may grant exceptions for insurers under the new Insurance Code provision.
The bill uses the licensing definition in Title 22, section 70545 to define “perinatal unit,” tying regulatory scope to existing hospital classifications rather than inventing a new clinical category.
The statutory regime is temporary: the provisions become inoperative July 1, 2033, and are repealed January 1, 2034.
Section-by-Section Breakdown
Every bill we cover gets an analysis of its key sections.
DMHC rulemaking for perinatal geographic access
Adds a DMHC mandate to develop and adopt geographic accessibility standards for perinatal units to ensure timely access for enrollees. DMHC must consult DHCS, DOI, and named stakeholders (ACOG, California Hospital Association, consumers, plans, labor, nurses and midwives). The section cross‑references DMHC’s existing authority to authorize alternative access standards or issue waivers, meaning DMHC will rely on preexisting waiver mechanics rather than creating a new exception regime from scratch. The provision references the Title 22 definition of perinatal unit and contains the inoperative/repeal dates that limit the rule to a finite term.
DOI rulemaking and insurer exceptions
Requires the Department of Insurance to adopt comparable geographic access standards for insureds and consult the other departments and stakeholders in the same stakeholder list. Unlike DMHC’s explicit waiver authority, the DOI provision expressly allows the department to issue exceptions for insurers, leaving the form, duration, and criteria for those exceptions to DOI rulemaking or policy. The section similarly ties the scope to the Title 22 definition of perinatal unit and is subject to the same temporary sunset schedule.
DHCS sets Medi‑Cal benchmarks by county type
Directs DHCS to develop and adopt time‑and‑distance standards specifically for Medi‑Cal managed care so that covered benefits are geographically accessible. That DHCS standard functions as the statutory benchmark the other two agencies must match or beat (i.e., insurers/plans cannot have longer travel or wait expectations than the Medi‑Cal standard). DHCS also must consult the same stakeholder universe and may authorize alternative access standards under the statute it adds to the Welfare & Institutions Code. This section frames the county‑type approach that will inform plan‑by‑plan assessments.
No state reimbursement required; criminal‑penalty implication
States that no state reimbursement is required under Article XIII B because the only potential local costs arise from changes to criminal or infraction definitions or penalties. Practically, it flags that violations within the DMHC enforcement framework could create new criminal or infractions exposure for plans, which is why the legislative fiscal language treats the measure as imposing a local program tied to criminal provisions.
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Explore Healthcare in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Pregnant people and newborns in rural and underserved counties — clearer geographic standards aim to reduce travel time and delay for labor, emergency obstetric care, and neonatal services.
- Maternal and infant health advocates and clinicians — the statute makes geographic access an explicit regulatory target and gives advocates a clear metric to use in complaints and policy discussions.
- Hospitals and perinatal units that already meet robust access levels — gain regulatory clarity that can be used in contracting and negotiations, and avoid ad hoc enforcement risk.
- Regulators (DMHC, DOI, DHCS) — receive a statutory mandate and framework for consistent interagency standards, which can simplify oversight and complaint handling across payer types.
Who Bears the Cost
- Health plans and insurers — must redesign networks, alter contracting or out‑of‑network arrangements, or seek waivers/exceptions if their networks do not meet the geographic benchmarks.
- Hospitals and rural perinatal units — may face pressure to expand services or shoulder higher uncompensated care if plans change network patterns; some facilities could confront financial strain if plans consolidate referral patterns.
- County health systems and local governments — may experience increased demand for transport, coordination, or subsidy to keep local perinatal capacity operational, without new state funding in the bill.
- State agencies — DMHC, DOI, and DHCS must devote staff time and administrative resources to coordinated rulemaking, stakeholder engagement, monitoring, and enforcement during the statutory window.
Key Issues
The Core Tension
The core dilemma is straightforward: impose strict, enforceable geographic access standards to protect maternal and neonatal outcomes, or preserve regulatory flexibility given existing limits on hospital capacity, workforce, and funding. Strict standards protect patients but pressure plans, hospitals, and local systems to close capacity gaps that the bill does not fund; too much flexibility undermines the access guarantees the bill seeks to create.
Several implementation questions and trade‑offs could shape real‑world effects. First, the baseline methodology matters: the statute requires alignment with Medi‑Cal managed care standards by county type, but it does not prescribe the specific time thresholds, measurement method (drive time vs. straight‑line distance), or whether emergency transport and obstetric triage follow different standards than routine prenatal appointments.
Agencies will need to set metrics and data sources; different choices materially change which counties or plans are in compliance.
Second, the bill couples a push for geographic access with limited flexibility (waivers/exceptions) and folds enforcement into existing frameworks that include significant sanctions. That creates tension between strict enforcement and the practical limits of workforce distribution, hospital capacity, and finances—especially in rural areas where creating new perinatal units or staffing them with neonatal specialists is expensive.
Because the statute contains no funding for capacity expansion, the most likely near‑term consequences are network redesign, more out‑of‑network authorizations, or increased use of exceptions rather than near‑term construction of new units.
Finally, the temporary nature of the regime (inoperative July 1, 2033; repeal January 1, 2034) cuts both ways: it limits long‑term regulatory burden and frames the measure as a time‑limited policy experiment, but it also discourages large capital investments by hospitals or counties because the regulatory requirements may not persist. Interagency coordination will therefore be central to avoid inconsistent standards and to ensure waiver/exception processes do not become de facto long‑term workarounds that undermine the statute’s intent.
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