How California’s SB 729 Expands Fertility Coverage for Surrogacy and Gamete Donation

California Senate Bill No. 729 (SB 729) is the Senate Bill that amends Health and Safety Code section 1374.55 and Insurance Code section 10119.6 to expand health insurance coverage to fertility services. It was signed into law by Governor Gavin Newsom on September 29th, 2024, and has an effective date of July 1st, 2025. The new law requires certain fully insured health policies to cover the diagnosis and treatment of infertility. 

What was the previous law? 

Existing California law, the Knox-Keene Health Care Service Plan Act of 1975, does not require health insurance policies to cover infertility treatment. It only requires that insurers offer employers the option to add general infertility treatment to their policies. However, this requirement specifically does not require insurers to provide employers with the option to add IVF coverage. 

How does SB 729 affect current health plans? 

According to the Legislative Counsel’s Digest, “[t]his bill would require large and small group health care

service plan contracts and disability insurance policies issued, amended, or renewed on or after July 1, 2025, to provide coverage for the diagnosis and treatment of infertility and fertility services.” For large group policies that cover at least 101 employees, it is now required to provide coverage for a maximum of three completed oocyte (egg) retrievals with unlimited embryo transfers of one embryo per transfer. For small group policies, the new law requires insurers to offer coverage for the diagnosis and treatment of infertility but does not mandate that the coverage be included in the policies. For both large and small group policies, the policy cannot have “any exclusion, limitation, or other restriction on coverage of fertility medications that are different from those imposed on other prescription medications.” 

How does SB 729 expand the definition of “infertility”? 

Originally, regulations required a year of “regular sexual relations without contraception,” meaning unprotected heterosexual intercourse, for someone to qualify as infertile. This standard of proof was difficult for same-sex couples, transgender individuals, and unpartnered individuals to meet. SB 729 expands the definition of infertility to include any of the following: 

• A licensed physician’s findings 

• A person’s inability to reproduce, either individually or with their partner, without medical intervention 

• Having failed to establish or carry a pregnancy to a live birth despite “regular, unprotected sexual intercourse” for 6 to 12 months for individuals over 35 and under 35 respectively. 

The bill specifically states that coverage for fertility services will be provided without discrimination based on factors such as “domestic partner status,” “gender identity,” or “sexual orientation.” This means that it is now easier to meet the standard of proof necessary to qualify as infertile and have treatments be covered by insurance plans.  

Additionally, it forbids the health insurance contracts from “[a]ny exclusion or denial of coverage of any fertility services based on a covered individual’s participation in fertility services provided by or to a third party. For purposes of this section, ‘third party’ includes an oocyte, sperm, or embryo donor, gestational carrier, or surrogate that enables an intended recipient to become a parent.” 

What does this mean? It means that if a covered individual requires a gamete donor or a surrogate to become a parent, then procedures such as the embryo transfer, egg retrieval, as well as medication for the transfer or retrieval must be covered with the same benefit that would be provided if it were applied to the covered individual. So long as the covered individual is taking part in treatments that would enable them to become a parent, they cannot be denied coverage for those treatments, even if it involves a third party not covered under the insurance contract. 

When is the new law coming into effect? 

Governor Newsom issued a signing letter requesting that the effective date of the new law be delayed to January 1st, 2026 in order to assess whether to keep the law as-is or to match what the state decides to include in its essential health benefits (EHB) benchmark plan. However, changing the effective date would require the California legislature to pass legislation changing it, which has not been done. As the February 21st, 2025 deadline for introducing new legislation has since passed, unless another bill under consideration is amended to include a delay, then passes both houses of the California legislature, and gets signed into law before the July 1st, 2025 effective date, it will not change. This means that “large and small group health care service plan contracts and disability insurance policies issued, amended, or renewed on or after July 1, 2025” are going to be required to provide coverage for the diagnosis and treatment of infertility and fertility services. The language indicates that policies that were issued before July 1st, 2025 will need to be amended or renewed before the coverage comes into effect. In other words, if you renewed your policy before July 1st, 2025, it will not change to become compliant with SB 729 until your next renewal. 

The implementation is delayed for the California Public Employees’ Retirement System (CalPERS), the benefit system for state employees, until July 1st, 2027.  

Are there any exceptions to this new law? 

SB 729 purports to apply to any fully insured plan that offers coverage to at least one resident of California and covers more than one hundred employees, even if that plan’s situs is not in California. This means that, even if a fully insured health plan for an employer is based in another state, as long as it covers even a single California-based employee, it could be subject to SB 729. However, SB 729 does not impact employers that self-fund their health plans, which are instead governed by the federal Employee Retirement Income Security Act. 

This new law also does not impact the following employers and/or their plans: 

• Religious employers 

• Specialized healthcare service plan contracts 

• Medi-Cal plans 

• Certain entities that enter into contracts with the California Department of Health Care Services for the delivery of healthcare services 

Conclusion 

California, despite being held as a leader in reproductive rights, was behind in how health insurance is mandated to cover IVF and other fertility services. For example, New York revised their insurance law to cover three IVF cycles for patients in large group insurance policies in 2020. Since 2022, Illinois provides coverage for four egg retrievals and unlimited embryo transfers. This is what the passage of SB 729 aims to address. An estimated 10 million eligible Californians will benefit from this new law, opening the full range of fertility treatments and allowing doctors to choose the most appropriate ones for their patients. IVF is often the standard of care for individuals facing infertility, and its exclusion from health insurance plans up until now has forced Californians to pay out-of-pocket or forego treatment entirely due to its significant expense, giving so many people the opportunity to build the families they want. 

Need more help navigating your own third party reproductive journey? Contact Tsong Law Group. Our lawyers can assist you with gamete and embryo donation, surrogacy contracts, and the parentage action. Tsong Law Group’s specialist lawyers are licensed in California, Washington, Illinois, Arizona, Oklahoma and New York.