California’s 2026–2027 Distressed Hospital Grant Program provides competitive financial-assistance grants to eligible nonprofit and public hospitals experiencing substantial financial distress. The program is administered by the California Department of Health Care Access and Information (HCAI) under Senate Bill 111 (Chapter 21, Statutes of 2026). Applications opened October 5, 2026 and are due November 9, 2026 at 5:00 PM Pacific Standard Time (PST).
Individual funding and total program resources
An individual applicant maximum or fixed award range is not published in the official application guide. Each hospital must justify its requested amount against its proposed Strategic Initiative Plan. California authorized $85,500,000 for the entire program, with an additional amount of up to $50,000,000 possible only if approved by the Department of Finance. These figures describe statewide program funding, not a per-hospital award. The official guide does not state a mandatory applicant matching percentage.
Eligible hospitals
Applicants must be California nonprofit or public hospitals operating alone or within an integrated healthcare system comprising no more than two separately licensed hospital facilities. Each hospital must document that government and uninsured payers account for at least 60% of gross revenue; provide a viable Strategic Initiative Plan and financial projections; and demonstrate best efforts to exhaust other financing options, including debt deferral or forgiveness where appropriate. Hospitals in larger integrated systems are ineligible. The 2026–2027 program is distinct from the completed 2026 Distressed Hospital Small Grant program and the earlier Loan program.
Permitted uses and award conditions
Projects must support documented strategic initiatives to restore financial viability, maintain essential healthcare access, and improve financial or operational outcomes. Applicants propose up to five initiatives with cost estimates, implementation milestones, key performance indicators, and a 24-month financial forecast. The guide does not provide an unrestricted expenditure authorization: the proposed use of funds must be justified in the hospital’s approved plan. Award disbursement is staged: 50% upon award and 50% six months afterward subject to verified progress. Awardees must report at six months and provide a final retrospective report at twelve months.
Required application package
Submit the signed application and required exhibits, including a Strategic Initiative Plan with 24-month balance-sheet, income-statement and cash-flow projections; two most recent audited financial statements and management letters; recent internally prepared monthly financial statements; financial ratios; utilization statistics; payer mix; partnership and affiliation disclosures; C-suite resumes; board member information; and any applicable board resolution or management services agreement. Applicants must document governance, community healthcare access, and their plan to restore financial stability. Incomplete applications are not considered.
How to apply
Use HCAI’s official 15-page grant guide and application (PDF) and current program webpage. Email the complete package to dhsgp@hcai.ca.gov by November 9, 2026, at 5:00 PM Pacific Standard Time. This is an applicant financial-assistance grant, not a vendor procurement or hospital loan.
Official sources independently reviewed October 10, 2026. Verify any later HCAI amendment before application.