On October 7, 2025, the California Medical Association (CMA) announced that Governor Gavin Newsom has signed Senate Bill 351 into law. The bill, which was sponsored by CMA and authored by Senator Christopher Cabaldon, aims to address concerns about the influence of private equity and hedge funds in health care delivery.
Senate Bill 351 strengthens California’s ban on the corporate practice of medicine. It gives the Attorney General authority to act against corporate entities that interfere with medical practice. The intent is to ensure that medical decisions are made by physicians and patients rather than financial interests.
CMA President Shannon Udovic-Constant, M.D., stated, “The signing of SB 351 is a victory for patient-centered care. This new law further protects the integrity of the physician-patient relationship against the expanding influence of private equity in health care. CMA is incredibly grateful to Senator Cabaldon for his leadership and to Governor Newsom for signing this vital legislation into law.”
The bill was created in response to increasing concerns about the impact of private equity in health care. These concerns include higher costs, lower quality of care, and reduced access for patients across the country.
Senator Cabaldon said, “I am grateful for the Governor’s signature to ensure that patients are receiving medical care prescribed by their doctors, not from private equity investors. Private equity investment in health care practices has quintupled over the past decade. That kind of growth demands modern enforcement tools, not to restrict investment, but to make sure it doesn’t hurt patient outcomes or drive up the cost of care.”
SB 351 received unanimous support in the Assembly with 80 yes votes and passed in the Senate with 32 yes votes. The bipartisan backing highlights a broad agreement that medical decision-making should be protected from corporate interference.
The bill was included as part of CMA’s sponsored legislative package for 2025.
