In spite of my disdain for Proposition 50 and its projected $285 million taxpayer cost, it’s important to recognize the times when Governor Newsom gets it right—especially when it benefits California businesses.
A few weeks ago, I wrote about health care affordability and bills that would hurt businesses.
This time, the Governor listened. He vetoed six (6) health care bills that will save hundreds of millions of dollars in premium cost increases for California employers.
This is a victory for the California Businesses for Affordable Healthcare Coalition, who fought hard, fearing that this legislation would bankrupt California businesses.
The only mandate Governor Newsom signed that was on the opposition list is SB 40 (Wiener), a pro-pharma bill that implements co-pay caps for insulin, essentially giving big pharma the ability to raise prices at will. The bill is expected to cost $10.3 million.
Here’s how each veto protected businesses from new costs and mandates:
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AB 432 (Bauer Kahan): The Governor agreed that the expansive coverage mandate was too far reaching, though he does say that he is asking the CA Health & Human Services Secretary to look at policy changes to address perimenopause and menopause. These subjects—once taboo—are receiving more emphasis. This will appeal to women in California.
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AB 546 (Caloza): Wildfire legislation has been pending since the fire that destroyed Pacific Palisades and parts of Los Angeles. The Governor vetoed this bill due to concerns about creating disparities and inequities for those who suffer from other health conditions, not related to a state emergency, such as a wildfire.
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AB 554 (Gonzalez): Though the Governor wholeheartedly supports affordable and accessible prevention for HIV / AIDS, the 2025 budget he signed has measures in place for no-cost, protective services. He does cite that certain parts of the measure were concerning regarding affordability, which was the theme that seemed to resonate.
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AB 1032 (Harabedian and Rivas): While the Governor shared the authors’ concerns about the increased need for behavioral health services after a wildfire, enrollees in commercial plans already have such coverage for visits, regardless of whether they live in a county where a local or state emergency has been declared.
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SB 257 (Wahab): The Governor commended the author for her commitment to ensuring pregnant women have early access to prenatal care, but felt the bill risked overall affordability for health care spending, citing that the bill risked spending tens of millions of dollars annually. Furthermore, the Governor stated that California is trying to control health care costs at a time when consumers face uncertainty and potential rate increases.
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SB 418 (Menjivar): The Governor said that he was concerned that forcing health care pans and insurers to cover 12-months of FDA-approved hormone therapy and supplies for self-administration would inflate the costs of care, resulting in an increase in enrollee premiums.
In a state where labor interests often dominate policymaking, this outcome proves that well-organized business coalitions can influence legislative outcomes.
And, regardless of Newsom’s motives – whether he really cares about affordability or is simply throwing the business dogs a few bones leading up to the Prop. 50 election next week – I’m glad I played a role.
All businesses need to band together to protect California’s economic engine and employers of all sizes—especially our small businesses who create the majority of jobs.
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