California SB 923: New Trans-Inclusive Healthcare Requirements for Health Plans

NEW REQUIREMENTS FOR HEALTH PLANS, INSURERS, AND MEDI-CAL MANAGED CARE ENTITIES

SB 923 requires healthcare service plans, health insurers, Medi-Cal managed care plans, and PACE organizations to engage in workforce cultural competency training. Key training elements include:

• Adopting inclusive communication techniques by using TGI-inclusive terminology and ensuring respectful, affirming interactions with TGI patients.
• Addressing health disparities by explaining how family and community acceptance influence TGI patient health outcomes and integrating this understanding into care practices.
• Conducting refresher course training whenever a complaint is filed and upheld against a staff member for failing to provide TGI-inclusive care and administering additional courses more frequently if needed.

Training must be provided to staff who directly interact with enrollees. This includes frontline personnel such as call center representatives, nurses, and other staff members who have contact with patients. Exempt from this training requirement are specialized healthcare service plans providing only dental or vision services and Medicare Advantage plans. Currently, SB 923 does not include any exemptions or opt-outs for staff or providers based on religious, moral, or rights of conscience objections grounds.

While SB 923’s statutory language sets an outer compliance deadline of no later than March 1, 2025, DMHC’s APL 24-018 specifies that all full-service healthcare service plans, regardless of size (and certain specialized plans other than dental or vision-only plans), must ensure that staff complete the required training by February 14, 2025. For health insurers regulated by the Department of Insurance or Medi-Cal managed care plans overseen by the Department of Health Care Services (DHCS), the statutory deadline remains March 1, 2025, unless their respective regulators issue further guidance.

In addition to initial training, DMHC’s APL requires that training be completed every two years thereafter, ensuring ongoing competency. Newly hired staff with direct enrollee contact must complete the training within 45 days of commencing employment. Health plans should also note that regulators may impose sanctions or penalties for noncompliance, reinforcing the importance of meeting these requirements.

UPDATED PROVIDER DIRECTORIES FOR GENDER-AFFIRMING SERVICES

By March 1, 2025, health plans, insurers, and Medi-Cal managed care plans must update their provider directories (as well as call center information) to identify which in-network providers have affirmed and previously provided gender-affirming services. These services might include hormone therapy, gender-confirming surgeries, gender-affirming gynecological care, or voice therapy.

ALREADY-IN-EFFECT CME REQUIREMENTS

Since 2006, curricula for CME courses in California have been required to include cultural and linguistic competency in the practice of medicine. Since 2022, CME course curricula also have been required to include the understanding of implicit bias. SB 923 amended the cultural competency portion of California’s Business and Professions Code Section 2190.1 to require that CME also include TGI health needs. The updated CME curricula should address:

• Using correct names, pronouns, and gender-neutral language.
• Avoiding assumptions about gender or sexual orientation.
• Understanding the discrimination and barriers that TGI patients face, and how implicit bias may influence clinical decisions.
• Implementing administrative changes, such as more inclusive intake forms, to create a welcoming care environment.

Cultural competency, including TGI-specific elements, and implicit bias training are not necessary for CME courses offered outside of California to California-licensed physicians and surgeons or as part of CME courses dedicated solely to research or other non-clinical issues lacking a direct patient care component.

IMPLEMENTATION STATUS OF SB 923 CME REQUIREMENTS

Since the TGI-focused CME requirements took effect in 2023, some larger health systems have begun integrating targeted training modules while smaller practices have struggled to find suitable specialized resources. According to the California Association of Health Plans, questions remain about how these training standards will align and be enforced across various health plans and delegated entities. Despite these uncertainties, incremental progress continues. As more healthcare organizations develop approved training resources and toolkits, accessibility and overall cultural competency likely will improve.

PRACTICAL STEPS FOR COMPLIANCE

• For Healthcare Providers: Integrate the updated CME modules into existing physician education, revise administrative materials (intake forms, electronic medical records) to reflect inclusive language, and ensure all frontline staff are trained in respectful, TGI-inclusive communication.
• For Health Plans and Insurers: Implement TGI-focused training as specified by DMHC: for full-service healthcare service plans, by February 14, 2025, and for other regulated entities, by the statutory deadline. Update provider directories to highlight gender-affirming providers by March 1, 2025, and establish effective complaint and grievance tracking to ensure accountability. With respect to ERISA-governed self-insured group health plans, SB 923 does not provide an express exception. However, ERISA typically preempts state laws that attempt to regulate employee benefit plans, although fully insured plans are generally subject to state insurance laws and would likely need to comply with SB 923. A plan that is not fully insured or regulated by the California DMHC would generally not need to comply. As of the publication date, we are unaware of any ERISA preemption challenges to SB 923. Some group health plan sponsors may wish to proceed with compliance and continue to watch for any updates.
• For Medi-Cal Managed Care Plans and PACE Organizations: Follow guidance issued by regulators, such as the DHCS Policy Letter 24-03, to implement required training, keep provider directories current with gender-affirming providers, and report TGI-related complaints. In addition, remain alert for further instructions from regulators and prepare to incorporate the required standards.

LOOKING AHEAD

When SB 923 was initially debated, some stakeholders opposed the legislation based on religious liberty and rights of conscience grounds, arguing that SB 923’s training mandates amount to unconstitutional compelled speech. However, a recent decision by the US District Court for the Central District of California in Khatibi v. Hawkins suggests that courts may uphold SB 923 as a form of government speech. The case involved a challenge to the implicit bias training requirement because some CME lecturers felt that their First Amendment rights were being violated. The court observed that “[s]tate-mandated curriculum requirements for CME courses necessary for state licensure constitutes government speech because when physicians . . . choose to teach CME courses for credit, they ‘speak for the state.’” (Khatibi v. Hawkins, No. 2:23-cv-06195-MRA-E, 2024 WL 3802523 (May 2, 2024)). The matter is currently under appeal to the US Court of Appeals for the Ninth Circuit.

CONCLUSION

SB 923 represents continued efforts by California toward ensuring that TGI patients receive respectful, informed, and affirming healthcare. With CME requirements already in effect and a range of new mandates, including system-wide training for health plans, updated provider directories, complaint tracking, and eventual quality standards, entities face a multifaceted compliance landscape. DHCS Policy Letter 24-03 and DMHC APL 24-018 provide clarity and actionable guidance, and both reflect the recommendations issued by the Transgender, Gender Diverse, or Intersex Working Group convened under SB 923’s mandate. Formal regulations under SB 923 will be adopted by July 1, 2027, but as the February and March 2025 deadlines approach, stakeholders should proactively implement training, update administrative practices, maintain transparent patient engagement, and follow the newly issued DHCS and DMHC directives.