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flag California hospitals sue state over new health care spending caps, calling them illegal and harmful.

flag California hospitals are suing the state’s Office of Health Care Affordability over new spending caps set at 3.5% starting in 2025, falling to 3% by 2029, with stricter limits for high-cost facilities. flag The California Hospital Association calls the rules arbitrary and illegal, warning they will force layoffs and service cuts. flag The state aims to align health care spending with income growth, citing rising costs without improved outcomes. flag Enforcement, including fines and performance plans, begins in 2028. flag Critics support the caps, saying higher spending hasn’t improved care access or quality. flag The lawsuit challenges the state’s authority, while officials declined to comment.

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