California Gov. Gavin Newsom signed two bills on Sept. 30 that set state rules for how health care providers and software developers use AI in clinical care. AB 1979 requires providers to preserve clinicians' independent judgment when AI informs care, and brings consumer health chatbots under the state's medical privacy law. SB 503 requires developers and users of clinical decision support tools to identify and mitigate biased impacts. Both take effect Jan. 1, 2027, according to the governor's office and the California Health Care Foundation.
The same day, Newsom vetoed two related bills: SB 903, which would have restricted AI in psychotherapy, and AB 2575, which would have protected health workers who override AI recommendations (Office of the Governor). CHCF's review also covers a third signed bill, SB 947, which sets rules for employers' use of automated decision systems from July 1, 2027. CHCF includes it because health care is one of California's largest employers.
What AB 1979 requires
AB 1979 is by Assemblymember Mia Bonta (D-Oakland) and was backed by the California Nurses Association (Nurse.org). It has three main provisions.
First, it bars health facilities, clinics and physician offices from using AI to independently perform clinical functions the law reserves for licensed professionals, or to direct unlicensed staff to perform them. Trainees working toward licensure are exempt (CHCF).
Second, it requires those providers to take reasonable steps to ensure that a licensed professional can exercise independent judgment whenever AI output informs patient care. Earlier drafts flatly banned using AI to replace a clinician's judgment, and lawmakers softened that to the "reasonable steps" standard, Nurse.org reports. A California Hospital Association spokesperson told Becker's Hospital Review the association no longer opposes the bill.
Third, it treats businesses that offer health care chatbots as health care providers under the Confidentiality of Medical Information Act, with the same confidentiality duties and penalties (CHCF).
The clinical oversight provisions exempt automated documentation and communication that do not involve professional judgment, such as record-update notices and reminders. Physician violations fall under the Medical Board of California or the Osteopathic Medical Board of California (Los Angeles County Medical Association).
What SB 503 requires
SB 503 is by Sen. Akilah Weber Pierson, M.D. (D-San Diego). It requires developers and deployers to make reasonable efforts to identify clinical decision support systems with known or reasonably foreseeable risks of biased impacts on people with protected characteristics, such as race, sex or age (Health System CIO; CHCF).
Developers must also make reasonable efforts to mitigate those risks. For flagged systems, they must make documentation available on request or at initial sale, whichever is earlier, covering training data, evaluation, intended uses, risks and monitoring. Deployers, including hospitals and medical practices, must monitor these systems regularly and take reasonable and proportionate steps to reduce the risk. A health system that builds its own tools can be both developer and deployer, according to Health System CIO.
The law covers AI outputs that aid decisions on timing of care, diagnosis or treatment. It excludes appointment management, reminders, patient education, previsit materials and payment processing, to the extent those tasks do not require a professional license. Compliance is not a defense against an unlawful discrimination claim.
The bill drew industry opposition. ATA Action, the policy arm of the American Telemedicine Association, asked Newsom to veto it in a Sept. 4 letter. It argued that the bill did not protect trade secrets in developer documentation, defined "biased impact" too vaguely, and did not credit documentation already prepared for FDA-cleared products.
Who is affected
California hospitals, clinics, physician offices and group practices carry the clinical judgment duty under AB 1979 and the monitoring duty under SB 503. Companies that sell clinical decision support software to them carry SB 503's identification, mitigation and documentation duties. Businesses offering health chatbots to consumers come under California's medical privacy law.
The Los Angeles County Medical Association advises practices to start by inventorying tools that influence diagnosis, treatment or timing of care, including features embedded in software they already use, and to name a clinical lead for each tool.
It is not yet clear how regulators or courts will judge what counts as "reasonable efforts" under SB 503 or "reasonable steps" under AB 1979.
The two vetoes
SB 903, by Sen. Steve Padilla (D-San Diego), would have limited AI in psychotherapy to administrative and supplementary support, required patient consent before AI recorded or transcribed a session, and barred companies from marketing chatbot services as therapy (CHCF). Newsom said in his veto message that the bill's definitions and scope were broad enough to harm legitimate clinical tools never meant to replace psychotherapy, CHCF reports. Padilla criticized the veto and said he plans to reintroduce the bill.
AB 2575, by Assemblymember Liz Ortega (D-San Leandro), would have barred employers from punishing direct-care workers solely for following or overriding a clinical AI tool while using their professional judgment. Newsom wrote that the bill was not "practical and enforceable" as written. He objected that its protection covered only punishment based solely on an override, and that it would put the Labor Commissioner in the position of judging the standard of care, Nurse.org reports. The California Nurses Association, which backed the bill, criticized the veto.
That leaves a gap the union has pointed to. AB 1979 requires providers to preserve clinician judgment, but it does not protect a nurse from discipline for overriding an AI tool, which AB 2575 would have done. Backers say they will bring the bill back next year.
What happens next
Both signed laws take effect Jan. 1, 2027. SB 503's documentation duty applies on request or at initial sale, so hospital requests to current vendors, and new purchase contracts, are among the first places the bias duties will apply.
This is a summary of reported provisions, not legal advice. The chaptered bill text controls.
Sources
- Office of Governor Gavin Newsom. "California's nation-leading AI framework just got stronger, Governor Newsom signs more first-in-the-nation worker protections and more." Sept. 30, 2026. https://www.gov.ca.gov/2026/09/30/californias-nation-leading-ai-framework-just-got-stronger-governor-newsom-signs-more-first-in-the-nation-worker-protections-and-more/
- Office of Governor Gavin Newsom. "Governor Newsom issues legislative update 9.30.2026." Sept. 30, 2026. https://www.gov.ca.gov/2026/09/30/governor-newsom-issues-legislative-update-9-30-2026/
- California Health Care Foundation. "Newsom Approves 3 Health Care AI Bills, Vetoes 2." Oct. 8, 2026. https://www.chcf.org/blog/2026/10/08/newsom-approves-3-health-care-ai-bills-vetoes-2/
- Health System CIO. "California's Clinical AI Bias Law Takes Effect Jan. 1, With Work Ahead for CIOs." Oct. 7, 2026. https://healthsystemcio.com/2026/10/07/california-clinical-ai-bias-law/
- Becker's Hospital Review. "California laws protect clinician judgment when AI is used in care." Oct. 1, 2026. https://www.beckershospitalreview.com/healthcare-information-technology/digital-health/california-laws-protect-clinician-judgment-when-ai-is-used-in-care/
- Nurse.org. "Newsom Vetoes Bill Protecting Nurses Who Override AI, Signs Clinical Judgment Law." Oct. 1, 2026. https://nurse.org/news/california-nurse-ai-override-bill-veto/
- Los Angeles County Medical Association. "California Sets Health AI Guardrails: What Physician Practices Should Review Now." Oct. 2, 2026. https://www.lacmamembers.com/post/california-sets-health-ai-guardrails-what-physician-practices-should-review-now
- ATA Action. Letter to Gov. Newsom requesting a veto of SB 503. Sept. 4, 2026. https://www.americantelemed.org/wp-content/uploads/2026/09/CA-SB-503-ATA-Action-Veto-Letter.pdf
- Imperial Valley Press. "Padilla lambastes Newsom veto of bill banning AI therapy chatbots." Oct. 3, 2026. https://www.ivpressonline.com/news/padilla-lambastes-newsom-veto-of-bill-banning-ai-therapy-chatbots/article_7671f389-94e2-4535-a836-3918d82efeb5.html
- National Nurses United. Statement on the AB 2575 veto. 2026. https://www.nationalnursesunited.org/press/governor-newsom-fails-californians-by-refusing-to-sign-ai-protection-law