California Sets Health Care Cost Growth Target

California’s Office of Health Care Affordability (OHCA) has set a 3.5 percent cap on health care spending growth, according to JD Supra. The cap starts in 2025 and will decrease to 3.0 percent by 2029. The cap will apply to health care entities including hospitals, facilities, outpatient clinics, large physician groups, and labs, as well as payors and fully integrated delivery systems. Starting in 2026, the OHCA will have authority to take enforcement action against facilities that exceed the target, including requiring explanation in public meetings, performance improvement plans, and/or financial penalties.