The State of California passed AB 1392 in October 2023 to encourage competitive business opportunities for everyone. AB 1392 requires major hospitals and hospital systems to submit supplier diversity statements, plans, and goals for increasing procurement from minority, women, LGBT, and disabled veteran business enterprises in an annual report. This bill expands on AB 962, which was passed in 2019.
Discover what AB 1392 is, how it affects California hospitals, and how HCP National can help hospitals reach their supplier diversity goals.
Founded in 1994, HCP National is “the healthcare industry’s insurance broker,” specializing in hospitals, healthcare systems, and medical groups. HCP National is a certified diverse (WBENC and MBE) commercial insurance brokerage, headquartered in California.
Hospitals seeking to work with more diverse suppliers can trust HCP National to handle their insurance. Experts in healthcare, HCP National is “the healthcare industry’s insurance broker.”
As a certified WBENC and MBE insurance brokerage, HCP National Insurance Services, Inc. is proud to be the largest certified minority-woman-owned commercial insurance brokerage in the United States.
Since 1994, HCP has served the healthcare industry with all lines of commercial insurance, from property and casualty to employee benefits and reinsurance. HCP has placed more than $1 billion in insurance premiums and currently covers over 1 million members nationwide.
HCP National’s headquarters are located in Aliso Viejo, California.
What is AB 1392?
Authored by Assemblymember Freddie Rodriguez, the California State Legislature passed bill AB 1392 to promote and support diversity in California’s health sector. It requires licensed hospitals with operating expenses of $50,000,000 or more, and licensed hospitals with operating expenses of $25,000,000 or more that are part of a hospital system, to submit annual plans on their minority, women, LGBT, and disabled veteran business enterprise procurement efforts.
According to AB 1392, plans must include “the hospital’s supplier diversity policy statement,” “short- and long-term goals and timetables, but not quotas, for increasing procurement from minority, women, LGBT, and disabled veteran business enterprises,” and “the hospital’s outreach and communications to minority, women, LGBT, and disabled veteran business enterprises.” In addition, the plan must include “the hospital’s procurements that are made from minority, women, LGBT, and disabled veteran business enterprises with at least a majority of the enterprise’s workforce in California, with each category aggregated separately, to the extent that information is readily accessible” as well as “the planned and past implementation of relevant recommendations made by the hospital diversity commission.”
Starting July 1, 2025, AB 1392 requires eligible hospitals and hospital systems to submit an annual plan for increasing procurement from minority, women, LGBT, and disabled veteran business enterprises. The Department of Health Care Access and Information then reviews the diversity procurement plan and provides feedback.
Civil penalties apply if hospitals fail to file.
AB 1392 presents a unique opportunity for hospitals to refine their D&I procurement methodologies.
The state wants to provide competitive business opportunities for all its people, while building relationships with diverse suppliers who uplift California’s communities and embracing businesses with majority Californian workforces.
The Department of Health Care Access and Information may provide recommendations to hospitals and vendors for increasing procurement from minority, women, LGBT, and disabled veteran business enterprises. The department can also support with outreach and provide assistance to facilitate the corrective procurement.
The plans and findings will be published online for public access.
Encourage D&I in the Healthcare Industry
When it comes to insuring hospitals, HCP National is the experienced professional you can trust. Our team will work with you to create a comprehensive risk management program that addresses all your healthcare industry insurance needs.
For more information about our hospital insurance products and services, contact HCP National today.
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