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<ns0:Id>20250SB__108999INT</ns0:Id>
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<ns0:Action>
<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-02-13</ns0:ActionDate>
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<ns0:SessionYear>2025</ns0:SessionYear>
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<ns0:MeasureType>SB</ns0:MeasureType>
<ns0:MeasureNum>1089</ns0:MeasureNum>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Senator Richardson</ns0:AuthorText>
<ns0:Authors>
<ns0:Legislator>
<ns0:Contribution>LEAD_AUTHOR</ns0:Contribution>
<ns0:House>SENATE</ns0:House>
<ns0:Name>Richardson</ns0:Name>
</ns0:Legislator>
</ns0:Authors>
<ns0:Title> An act to amend Section 127693 of, and to add Sections 1374.6 and 130514 to, the Health and Safety Code, to add Section 10123.62 to the Insurance Code, and to add Section 2805 to the Labor Code, relating to health. </ns0:Title>
<ns0:RelatingClause>health</ns0:RelatingClause>
<ns0:GeneralSubject>
<ns0:Subject>Preventive Care Act. </ns0:Subject>
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<html:p>
(1)
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Existing law requires the California Health and Human Services Agency to enter into partnerships resulting in the production of generic prescription drugs, including at least one form of insulin made available at production and dispensing costs, if one does not already exist in the market. Existing law requires the insulin production partnership to consider guaranteeing priority access to insulin supply for the state.
</html:p>
<html:p>This bill, the Preventive Care Act, would require the above-described partnerships to also include the production of at least one glucagon-like peptide-1 (GLP-1) or GLP-1 receptor agonist (GLP-1RA) made available at production and dispensing costs and to consider guaranteeing priority access to GLP-1 or GLP-1RA supply for the state.</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Existing law requires the State Department of Health Care Services to negotiate drug discount agreements with drug manufacturers and to encourage manufacturers to maintain private discount drug programs.
</html:p>
<html:p>This bill would authorize an employer with 100 or more employees to negotiate directly with a drug manufacturer to provide a discount for a GLP-1 or GLP-1RA.</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Existing law sets forth the obligations of an employer in the employment relationship with an employee.
</html:p>
<html:p>This bill would require an employer with 100 or more to offer its employees access to exercise programs, gym memberships, or both, nutrition programs, and coverage for a GLP-1 or GLP-1RA.</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care
service plans by the Department of Managed Health Care, and makes a willful violation of the act a crime. Existing law provides for the regulation of health insurers by the Department of Insurance. Existing law sets forth specified coverage requirements for plan contracts and insurance policies.
</html:p>
<html:p>This bill would require a large group health care service plan contract or health insurance policy issued, amended, or renewed on or after January 1, 2027, to cover weight loss as a medical condition. The bill would require a health care service plan contract that provides coverage for outpatient prescription drug benefits and is issued, amended, or renewed on or after January 1, 2027, to include coverage for at least one antiobesity medication approved by the United States Food and Drug Administration. Because a willful violation of these provisions by a health care service plan would be a crime, the bill would impose a state-mandated local program.</html:p>
<html:p>
(5)
<html:span class="EnSpace"/>
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
</html:p>
<html:p>This bill would provide that no reimbursement is required by this act for a specified reason.</html:p>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
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<ns0:Num>SECTION 1.</ns0:Num>
<ns0:Content>
<html:p>This act shall be known, and may be cited, as the Preventive Care Act.</html:p>
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<ns0:Num>SEC. 2.</ns0:Num>
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Section 1374.6 is added to the
<ns0:DocName>Health and Safety Code</ns0:DocName>
, to read:
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<ns0:Num>1374.6.</ns0:Num>
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<html:p>
(a)
<html:span class="EnSpace"/>
A large group health care service plan contract issued, amended, or renewed on or after January 1, 2027, shall cover weight loss as a medical condition.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
A large group health care service plan contract that provides coverage for outpatient prescription drug benefits and is issued, amended, or renewed on or after January 1, 2027, shall include coverage for at least one FDA-approved antiobesity medication.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
This section does not prohibit a plan from applying utilization management to determine the medical necessity for weight loss under this section if appropriateness and medical necessity determinations are made in the same manner as those determinations are made for the
treatment of any other illness, condition, or disorder covered by a contract.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
Coverage criteria for FDA-approved antiobesity medications shall not be more restrictive than the FDA-approved indications for those treatments.
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<html:p>
(e)
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For purposes of this section, “FDA-approved antiobesity medication” means a medication approved by the United States Food and Drug Administration with an indication for chronic weight management in patients with obesity.
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<html:p>
(f)
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This section does not apply to a specialized health care service plan contract that covers only dental or vision benefits or a Medicare supplement contract.
</html:p>
<html:p>
(g)
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This section does not limit existing prescription drug coverage requirements, including the requirements of Section 1300.67.24 of Title 28 of the
California Code of Regulations.
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<ns0:Num>SEC. 3.</ns0:Num>
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Section 127693 of the
<ns0:DocName>Health and Safety Code</ns0:DocName>
is amended to read:
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<ns0:Num>127693.</ns0:Num>
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<html:p>
(a)
<html:span class="EnSpace"/>
CHHSA shall enter into partnerships resulting in the production, procurement, or distribution of generic prescription drugs, with the intent that these drugs be made widely available to public and private purchasers, providers and suppliers as defined in subdivision (b) of Section 1367.50, and pharmacies as defined in Section 4037 of the Business and Professions Code, as appropriate. The generic prescription drugs shall be produced or distributed by a drug company or generic drug manufacturer that is registered with the United States Food and Drug Administration.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
CHHSA shall only enter into partnerships pursuant to subdivision (a) to produce a generic prescription drug at a price that results in savings, targets failures in the
market for generic drugs, or improves patient access to affordable medications.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
For top drugs identified pursuant to the criteria listed in paragraph (5), CHHSA shall determine if viable pathways exist for partnerships to manufacture, procure, or distribute generic prescription drugs by examining the relevant legal, market, policy, and regulatory factors.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
CHHSA shall consider the following, if applicable, when setting the price of a generic prescription drug:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
United States Food and Drug Administration user fees.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
Abbreviated new drug application acquisition costs amortized over a five-year period.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
Mandatory rebates.
</html:p>
<html:p>
(D)
<html:span class="EnSpace"/>
Total contracting and production costs for the drug, including a reasonable amount for administrative, operating, and rate-of-return expenses of the drug company or generic drug manufacturer.
</html:p>
<html:p>
(E)
<html:span class="EnSpace"/>
Research and development costs attributed to the drug over a five-year period.
</html:p>
<html:p>
(F)
<html:span class="EnSpace"/>
Other initial start-up costs amortized over a five-year period.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
Each drug shall be made available to providers, patients, and purchasers, as appropriate, at a transparent price and without rebates, other than federally required rebates.
</html:p>
<html:p>
(5)
<html:span class="EnSpace"/>
CHHSA shall prioritize the selection of generic prescription drugs that have the greatest impact on lowering drug costs to patients, increasing competition and addressing shortages in the prescription drug market,
improving public health, or reducing the cost of prescription drugs to public and private purchasers.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
In identifying generic prescription drugs to be produced, CHHSA shall consider the report produced by the Department of Managed Health Care pursuant to subdivision (b) of Section 1367.243, the report produced by the Department of Insurance pursuant to subdivision (b) of Section 10123.205 of the Insurance Code, and pharmacy spending data from Medi-Cal and other entities for which the state pays the cost of generic prescription drugs.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The partnerships entered into pursuant to subdivision (a) shall include the production of at least one form of insulin made available at production and dispensing costs, if one does not already exist in the market. Dispensing costs may include related expenses such as transportation, distribution, and market
operations. Any partnership shall also consider:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
Guaranteeing priority access to insulin supply for the state.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
Guaranteeing the manufacture of at least four high-priority drugs for California, as identified pursuant to paragraph (5) of subdivision (b).
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
Creating a state brand identifying biosimilar insulin and generic prescription drugs sold in California under this section.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
The partnerships entered into pursuant to subdivision (a) shall include the production of at least one glucagon-like peptide-1 (GLP-1) or GLP-1 receptor agonist (GLP-1RA) made available at production and dispensing costs, if one does not already exist in the market. Dispensing costs may
include related expenses such as transportation, distribution, and market operations. Any partnership shall also consider guaranteeing priority access to GLP-1 or GLP-1RA supply for the state.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
CHHSA shall prioritize drugs for chronic and high-cost conditions, and shall consider prioritizing those that can be delivered through mail order.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
CHHSA shall consult with all of the following public and private purchasers, as appropriate, to develop a list of generic prescription drugs to be manufactured or distributed through partnerships:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The Public Employees’ Retirement System, the State Department of Health Care Services, the California Health Benefit Exchange (Covered California), the State Department of Public Health, the Department of General Services, and the Department of Corrections and Rehabilitation, or the entities acting on behalf of each of those state purchasers.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Licensed health care service plans.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Health insurers holding a valid outstanding certificate of authority from the Insurance Commissioner.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
Hospitals.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
Before effectuating a partnership pursuant to this section, CHHSA shall consider the volume of each generic prescription drug over a multiyear period to support a market for a lower cost
generic prescription drug, if volume is an important factor in driving down the cost of the drug. For partnerships involving procurement, CHHSA shall determine minimum thresholds for procurement of an entity’s expected volume of a targeted drug from the company or manufacturer over a defined target period. In making advance commitments, CHHSA may consult with the Statewide Pharmaceutical Program and the California Pharmaceutical Collaborative.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
The listed entities in paragraphs (2) to (4), inclusive, of subdivision (d) shall not be required to purchase prescription drugs from CHHSA or entities that contract or partner with CHHSA pursuant to this chapter.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
CHHSA shall not be required to consult with every entity listed in paragraphs (2) to (4), inclusive, of subdivision (d), so long as purchaser engagement includes a reasonable representation from these groups.
</html:p>
<html:p>
(h)
<html:span class="EnSpace"/>
Any partnership entered into pursuant to this section may include representation and involvement with the governance of the contractor entity.
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<ns0:Num>SEC. 4.</ns0:Num>
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Section 130514 is added to the
<ns0:DocName>Health and Safety Code</ns0:DocName>
,
<ns0:Positioning>immediately following Section 130513</ns0:Positioning>
, to read:
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<ns0:LawSection id="id_941B175A-E866-4415-A4C0-EF57B52F1901">
<ns0:Num>130514.</ns0:Num>
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<ns0:Content>
<html:p>An employer with 100 or more employees may negotiate directly with a drug manufacturer to provide a discount for a glucagon-like peptide-1 (GLP-1) or GLP-1 receptor agonist.</html:p>
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<ns0:Num>SEC. 5.</ns0:Num>
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Section 10123.62 is added to the
<ns0:DocName>Insurance Code</ns0:DocName>
, to read:
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<ns0:LawSection id="id_10A33CBF-286B-4FA4-B3D1-CA2880AB3B14">
<ns0:Num>10123.62.</ns0:Num>
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<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
A large group health insurance policy issued, amended, or renewed on or after January 1, 2027, shall cover weight loss as a medical condition.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
This section does not apply to a specialized health insurance policy that covers only dental or vision benefits or a Medicare supplement policy.
</html:p>
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<ns0:Num>SEC. 6.</ns0:Num>
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Section 2805 is added to the
<ns0:DocName>Labor Code</ns0:DocName>
, to read:
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<ns0:LawSection id="id_7199E681-C141-44CD-B9F5-CB3CF70CC5D3">
<ns0:Num>2805.</ns0:Num>
<ns0:LawSectionVersion id="id_8F6F1FB5-465C-4CE3-94B1-2D5FE19B4F36">
<ns0:Content>
<html:p>An employer with 100 or more employees shall offer its employees access to all of the following:</html:p>
<html:p>
(a)
<html:span class="EnSpace"/>
Exercise programs, gym memberships, or both.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
Nutrition services.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
Coverage for a glucagon-like peptide-1 (GLP-1) or GLP-1 receptor agonist.
</html:p>
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<ns0:Num>SEC. 7.</ns0:Num>
<ns0:Content>
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No reimbursement is required by this act pursuant to Section 6 of Article XIII
<html:span class="ThinSpace"/>
B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII
<html:span class="ThinSpace"/>
B of the California Constitution.
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