AB1882 - Safe Delivery Fund Pilot Program.

Enrolled August 24, 2026 Passed IN Senate August 20, 2026 Passed IN Assembly May 26, 2026 Amended IN Assembly March 19, 2026 CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION Assembly Bill No. 1882 Introduced by Assembly Member Ellis February 12, 2026 An act to add and repeal Chapter 6.3 (commencing with Section 127650) of Part 2 of Division 107 of the Health and Safety Code, relating to hospitals. LEGISLATIVE COUNSEL'S DIGEST AB 1882, Ellis. Safe Delivery Fund Pilot Program. Existing law establishes the Department of Health Care Access and Information to oversee and administer various health programs, including, among others, the California Reproductive Health Equity Program. Under existing law, this program provides grant funding to safety net providers of abortion and contraception services to offset the costs of providing uncompensated care to patients with low incomes who would otherwise lack access to care. Existing law establishes the California Reproductive Health Equity Fund, and, within the limits of funds available, authorizes the department to award grants that, in the department’s judgment, best promote the purposes of the program. This bill would establish the Safe Delivery Fund Pilot Program, until January 1, 2030, which would be administered by the department to provide funding to hospitals to offset uncompensated standby costs associated with maintaining specialty physician coverage, advanced practice provider coverage, and hospital staffing necessary to safely provide deliveries and related inpatient specialty services. The bill would require a hospital to meet specified requirements to qualify for the program, including, among other things, that the hospital can demonstrate that the hospital serves a geographically isolated population and that loss of obstetric services would significantly impact access to maternity care. This bill would establish the Safe Delivery Fund, and would require moneys in the fund to be available, upon appropriation by the Legislature, to the department for the purposes of the program. The bill would require the hospital to use the funds from the program for salaries, benefits, insurance, contracted physician compensation, contracted advanced practice provider compensation, or other expenses attributable to maintaining standby clinical capacity. The bill would require the program to reimburse a hospital quarterly based on the number of deliveries performed per day using a specified schedule. The bill would prohibit the department from awarding a hospital more than $5,000,000 per year. This bill would require a participating hospital, by April 1, 2027, and quarterly thereafter, to submit to the department specified data, including, among other things, maintenance of specialty staffing and service availability. The bill would authorize the department to conduct annual audits or program reviews, as specified. The bill would require a hospital to meet all of the program requirements for continued participation in the program. Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO Bill Text The people of the State of California do enact as follows: SECTION 1. Chapter 6.3 (commencing with Section 127650) is added to Part 2 of Division 107 of the Health and Safety Code, to read: CHAPTER 6.3. Safe Delivery Fund Pilot Program 127650. (a) The Safe Delivery Fund Pilot Program is hereby established within the Department of Health Care Access and Information. The department shall administer the program. (b) The purpose of the program is to provide funding to hospitals that support standby capacity in a hospital for all of the following specialty services: (1) Inpatient general surgery. (2) A licensed labor and delivery inpatient unit with nursery beds. (3) Inpatient pediatrics capability. (c) To qualify for the program, a hospital shall meet all of the following: (1) Maintain 24-hours-per-day, 7-days-per-week, 365-days-per-year clinical readiness to provide the services described in subdivision (b) consistent with state and federal licensing and certification requirements. (2) Be a critical access hospital that provides obstetric services. (3) Be located at least 75 miles from the nearest tertiary hospital. (4) Perform no more than 225 inpatient surgeries annually. (5) Maintain active licensure with the State Department of Public Health and certification with the federal Centers for Medicare and Medicaid Services. (6) Maintain a valid Medi-Cal contract, including participation with the county-designated Medi-Cal managed care plans, as applicable. (7) Demonstrate that the hospital serves a geographically isolated population and that loss of obstetric services would significantly impact access to maternity care. (d) A hospital shall use the funds from the program for salaries, benefits, insurance, contracted physician compensation, contracted advanced practice provider compensation, or other expenses attributable to maintaining standby clinical capacity. 127651. (a) The Safe Delivery Fund is hereby established. (b) The primary purpose of the fund is to offset uncompensated standby costs associated with maintaining specialty physician coverage, advanced practice provider coverage, and hospital staffing necessary to safely provide deliveries and related inpatient specialty services. (c) (1) Moneys in the fund shall be available, upon appropriation by the Legislature, to the department for the purposes of this chapter. (2) The department shall not award a hospital more than five million dollars ($5,000,000) per year. 127652. (a) On an annual basis, the department shall calculate standby costs, in consultation with providers, using the hospital’s prior-year Medicare or Medi-Cal cost report, and shall be composed of all of the following: (1) Medicare cost-based reimbursement. (2) Reimbursement from any other cost-based payer. (3) Federal disproportionate share hospital payments attributable to the covered specialty services, as specified by the department. (b) The department may calculate standby costs per delivery using a time-study methodology and relative value units, or another allocation methodology established by the department. (c) The program shall reimburse a hospital quarterly based on the number of deliveries performed per day, using the following schedule: (1) Twenty five thousand dollars ($25,000) for zero deliveries. (2) Eighteen thousand five hundred dollars ($18,500) for one delivery. (3) Twelve thousand dollars ($12,000) for two deliveries. (4) Five thousand five hundred dollars ($5,500) for three deliveries. (5) Zero dollars ($0) for four or more deliveries. (d) The department may conduct audits of a participating hospital’s cost reports. 127653. (a) By April 1, 2027, and quarterly thereafter, a participating hospital shall submit to the department all of the following data: (1) Number of deliveries performed per day. (2) Maintenance of specialty staffing and service availability. (3) Quality metrics, including at minimum three maternal and infant quality indicators to be specified by the department. (4) Verification of costs using annual Medicare or Medi-Cal cost reports. (b) The department may conduct annual audits or program reviews to ensure both of the following: (1) Funds are used to maintain standby specialty service capacity. (2) Hospitals continue to meet eligibility criteria and quality requirements. (c) A hospital shall meet all of the program requirements for continued participation in the program. 127654. This chapter shall remain in effect only until January 1, 2030, and as of that date is repealed.