On August 1, 2025, the city of San Francisco released the updated rates for the Health Care Expenditure (“Expenditure”) for the 2026 calendar year. As background, the City of San Francisco has an extraterritorial law called the Health Care Security Ordinance (HCSO) for all employers with at least 20 employees in any location if at least one employee works within San Francisco. The HCSO requires that covered employers spend a minimum amount on healthcare (the Expenditure amount) for each hour worked by an employee within San Francisco, provided that the employee worked for at least 90 days and averages at least 8 hours worked per week within the city. The 2026 Expenditure rates by employer size have increased to $4.11 per hour, with a maximum of $706.92 per month (for employers with 100 or more employees), $2.74 per hour with a maximum of $471.28 per month (for employers with 20-99 employees or 50-99 employees for non-profits) respectively. Additionally, employees who are considered managerial, supervisory and confidential, and who make more than $128,861 per year ($61.95 per hour), are exempt from the Expenditure requirement in 2026. Covered employers should ensure they are using the updated rates in 2026.

On July 22, 2025, the IRS released the updated ACA Employer Shared Responsibility (“Employer Mandate”) penalties for the 2026 calendar year. The Employer Mandate penalties apply to Applicable Large Employers (ALEs) for failing to offer coverage, or for failing to offer coverage that meets certain minimum standards. The updated 2026 penalties are $3,340 per full-time employee for not offering minimum essential coverage (MEC) to at least 95% of the ALE’s full-time employees and their dependent children (increased from $2,900 in 2025) and $5,010 per full-time employee that receives subsidized Exchange coverage due to lack of affordability (increased from $4,350 in 2025). Notably, while last year, these penalties decreased for the first time since their inception, this year, there is a significant increase in the penalty amounts.

 Beginning January 1, 2026 (previously July 1, 2025), the State of California will put into effect a new law, SB 729, which requires large fully insured group health plans (plans with 101 or more participants), as well as large group, non-specialized disability insurance plans within the state, to provide coverage for fertility and infertility services for any California residents. The new law requires large group policies to provide coverage for the diagnosis and treatment of infertility, including coverage for up to three completed egg retrievals with unlimited embryo transfers. 

On June 9, 2025, Secretary of Health and Human Services, Robert F Kennedy announced that he would be removing all 17 members of the Center for Disease Control and Prevention’s Advisory Committee for Immunization Practices (ACIP) and replacing them with new members. Kennedy stated that the committee was full of conflicts of interest and that a new slate of members was necessary to restore public trust in the Committee. This ACIP reformation comes on the heels of Kennedy announcing that the COVID 19 vaccine would no longer be recommended for healthy children and pregnant women.