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Proposition 44 would penalize community healthcare clinics that spend less than 90% of their revenue on “program services” that advance their charitable purpose.
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The measure would regulate federally qualified health centers, or private nonprofit health clinics that provide primary care to medically underserved areas and populations. There are about 2,000 of these so-called “safety net” clinics in California, which report spending an average of about 80% of their revenue on providing healthcare services.
To become a FQHC, a clinic must meet a number of criteria. It must be located in or serving a high-need community, governed by a community board made up of at least 51% health center patients, charge patients for healthcare services based on their ability to pay and receive a Health Center Program award.
By mandating that 90% of the revenue made at safety net clinics go towards patient services, Prop. 44 would limit administrative spending to 10% of revenue. If a clinic does not meet this standard, it would have to pay a penalty equal to the amount of spending it needs to reach the 90% minimum. Clinics could earn these funds back if they meet the spending minimum within five years. If the five-year deadline is not met, the state would keep the funds and spend them on clinic workforce programs.
The proposition is one of the least popular of the 14 statewide measures on this year’s ballot, according to a Public Policy Institute of California poll released Sept. 15. Just 34% of the 1,745 California adults surveyed said they backed it.
And experts question if it’s possible for clinics to meet the ballot measure’s 90% threshold.
What a ‘yes’ vote means
A “yes” vote on Prop. 44 would support requiring nonprofit FQHCs to spend a minimum of 90% of their annual total revenue on expenses that advance the clinic’s mission. The state Department of Public Health would collect penalties from clinics that fail to spend the designated amount on patient care.
The penalties collected after the measure’s implementation would be placed into a new “Mission Spend Ratio Penalty Account” within the state’s Special Deposit Fund. Any penalties not retrieved after the five-year deadline would be allocated to clinical worker training, recruitment and other state-run programs.
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What a ‘no’ vote means
A “no” vote on Prop. 44 would oppose enacting a spending minimum on patient services at nonprofit FQHCs. Currently, there is no set percentage of revenue that safety net clinics must spend on patient services.
Supporters of Prop. 44
Supporters of Prop. 44 argue that it would hold clinics accountable for wasteful spending. The Yes campaign claims that the CEOs of some clinics are misappropriating taxpayer funds to inflate their own salaries, rather than putting the money toward patient care and clinic staffing.
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The measure’s proponents say the proposed regulations are, in part, a response to HR 1, or the “One Big, Beautiful Bill Act.” The legislation, which President Donald Trump signed into law in July 2025, authorized sweeping cuts to Medicaid and other federal healthcare services. The potential impacts of HR 1 necessitate more conservative spending in California’s healthcare clinics, Prop. 44’s supporters say.
“As massive cuts to federal healthcare funding hit California, it’s time to ensure community clinics are spending our tax dollars where it is needed most: on patient care,” reads a statement on the Yes campaign’s website. “Not executive pay and other non-essentials.”
Service Employees International Union-United Healthcare Workers West — the same group behind the billionaire tax — is leading the campaign to support the initiative.
“We’re calling for accountability because frontline workers and patients at community clinics deserve better,” said SEIU-UHW member Brisa Barrera, who works as a healthcare provider at a community clinic in Santa Rosa. “Clinics receive public dollars to serve vulnerable populations, but when that money is siphoned off for bloated administrative costs, it’s the patients and workers who suffer.”
Opponents of Prop. 44
Those opposed to Prop. 44 argue that the restrictions imposed by the measure would limit community clinics ability to provide some services such as nurse managers, translation services, insurance assistance, community education and information technology.
The No campaign’s website states that the measure would cause morethan $1 billion in losses to community health clinics in its first year of implementation, as many FQHCs will be unable to meet the 90% spending minimum.
“This measure will result in billions being cut from community health centers, forcing many to reduce services and close their doors,” said Francisco Silva, president and CEO of the California Primary Care Association, in a statement. “It is reprehensible that special interests are pushing this measure at a time when clinics and our patients are facing unprecedented challenges.”
Others against the measure have said it imposes unnecessary restrictions on clinics that are already heavily regulated by state and federal governments. FQHCs are subject to mandatory regular public health audits, and all clinics are overseen by patient board members.
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Opponents to the measure include:
- The Democratic Party of California
- The California Teachers Association
- California Chamber of Commerce
- The California Hospital Association
- The California Medical Association
- The California Primary Care Association
- Planned Parenthood Affiliates of California