Senator Shannon Grove’s bill to support rural hospitals and graduate medical education, signed into law by Governor Newsom

Senator Shannon Grove (R-Bakersfield) is proud to announce that Governor Gavin Newsom signed her legislation, Senate Bill 246 into law. By growing GME programs, SB 246 addresses the critical shortage of healthcare providers in underserved areas, supporting the training of skilled physicians who serve California’s diverse populations. This bill will help ensure there is continued access to quality healthcare while also strengthening the state’s healthcare infrastructure. 

“Two-thirds of California’s district hospitals serve rural and underserved communities, and many are struggling financially,” said Senator Shannon Grove. “The passage of SB 246 is a critical step toward ensuring these hospitals can sustain their Graduate Medical Education programs, which are vital for training the next generation of healthcare providers. This bill has the potential to unlock $15-20 million annually in new Medi-Cal funding, securing the future of healthcare access in our most vulnerable communities without additional state costs.”

This legislation authorizes the Department of Health Care Services (DHCS) to establish a new Medi-Cal Graduate Medical Education (GME) supplemental payment program for Non-Designated Public Hospitals (NDPHs), delivering critical support to hospitals in rural and underserved communities across California.

SB 246 is modeled after the existing Medi-Cal GME program for Designated Public Hospitals (DPHs). It enables NDPHs to fund the nonfederal share of the program through intergovernmental transfers, requiring no state General Fund resources. The program includes a 5% administrative fee, consistent with the DPH program, to strengthen Medi-Cal operations

SB 246 will be enacted on January 1^st, 2026. For more information, follow @ShannonGroveCA.