California Writes the 2024 Federal Parity Rules Into State Law From January 1

Governor Newsom signed AB 2011 on September 30 as Chapter 915, Statutes of 2026. From January 1, 2027, it requires individual, small group and large group plans regulated by DMHC, and insurers regulated by CDI, to provide covered mental health and substance use disorder benefits in compliance with the federal parity law and "all rules, regulations, and guidance … as those rules, regulations, and guidance existed on January 1, 2025."

The turn: a fixed date, while the federal rules move

That date captures the 2024 federal final rules, which the bill's findings say emphasize that parity "must be demonstrated both as written and in operation." The findings also say "recent litigation challenging federal parity regulations has created uncertainty." On September 27 we reported that the Labor Department narrowed its parity enforcement for employer plans to three areas. For state-regulated California coverage, AB 2011 holds the standard where it was, whatever Washington does next.

The findings name where noncompliance shows up: "nonquantitative treatment limitations, including prior authorization, medical necessity standards, network composition, and reimbursement practices." Those are the levers that set ABA hours and rates.

ABA isn't named in the bill. It's our reading, not the bill's text, that ABA falls under these sections as a covered mental health benefit.

What else it does

• Where the state rule "conflict[s] with or materially differ[s] from federal regulations," DMHC and CDI must review it and issue joint guidance. That guidance is exempt from the Administrative Procedure Act.
• The Legislature says the act codifies existing protections, "not … establishing new health care benefit mandates or expanding the scope of required covered services."

The limits

The amended sections cover DMHC plans and CDI policies. They don't reach self-funded employer plans, which stay with federal enforcement, and they don't address Medi-Cal. No guidance has been issued, and the bill sets no date for it.

What you must know or do

• Billers: sort your California commercial ABA denials and limits since January by plan type: DMHC, CDI or self-funded. Only the first two gain anything from this law.
• Owners: for each DMHC or CDI plan that applies an ABA-specific limit, such as a weekly hours cap or extra review step, ask the plan in writing for its parity analysis of that limit. From January 1, a complaint to DMHC or CDI can cite H&S §1374.76 or Ins. Code §10144.4 and the federal rules as of January 1, 2025.
• Self-funded plans: complaints go to the federal Department of Labor, under the narrower enforcement described in our September 27 piece.