California delaying $25 healthcare minimum wage: What ASCs need to know

On May 31, California Gov. Gavin Newsom delayed the start of minimum wage increases for healthcare workers by one month. 

Here are four things ASCs need to know:

1. The new legislation postpones the start of the wage adjustments to July 1. The move will provide extra time to work with state lawmakers to tie provisions related to the minimum wage law to state budget conditions. 

2. Mr. Newsom signed the bill raising the minimum wage for healthcare workers in the state to $25 an hour on Oct. 13. The legislation, SB 525, called for annual increases beginning June 1, ranging from $18 to $25 per hour. Healthcare facilities are expected to reach a $25 per hour minimum wage by June 1, 2028, or 2033, for some in rural locations.

3. In November, Mr. Newsom released a $4 billion price estimate for the 2024-25 fiscal year alone and indicated he could want to delay the increases given the state's projected budget shortfall. 

4. In May, he introduced his revised budget proposal and said he would not sign the budget without the deal being addressed.

5. California currently has 848 ASCs, all of which could begin to see changes from the new bill. At some ASCs, staff members, especially in rural areas, earn less than $25 an hour. The bill could cause increased financial pressure on ASCs.

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