California AB 1041: What Health Plans and Credentialing Delegates Need to Know Before 2027 and 2028

Two Deadlines, And Less Than a Year to Get Ready

On October 11, 2025, Governor Newsom signed Assembly Bill 1041 into law. For credentialing leaders at California health plans and delegated entities, this enactment fundamentally reshapes your operations, provider credentialing timelines, and compliance workflows.

Before, your turnaround time was an internal service level you set yourself, and you could use any application form you wanted. But from 2027 and 2028, respectively, you need to adhere to a statutory 90-day deadline and use the standardized CAQH credentialing form. 

If you refuse to meet any of these rules, you will be violating the law. This article teaches you how to ensure that doesn’t happen. Learn six moves to make ahead of time, and the deadline each one protects you against. 

Why Listen to Us?

Assured is an NCQA-certified CVO. We run primary source verification across 2,000+ primary sources in seconds and deliver committee-ready credentialing files in <48 hours, compared to the industry average of 60–120 days. 

Our work with Tono Health enabled them to credential more than 120 board-certified dermatologists across 31 states in just one month. Additionally, Birches Health partnered with us to seamlessly onboard over 750 providers in under a year as part of their nationwide expansion across 50+ states. 

Complying with AB 1041 requires mastering speed and documentation, and that’s exactly what we help health organizations with every single day. 

What Is California AB 1041?

AB 1041 is a California law that sets deadlines and processes for health plan credentialing. Assembly members Buffy Wicks and Steve Bennett wrote it, and the Physician Association of California sponsored it. It adds sections 1374.198 and 1380.2 to the Health and Safety Code, plus sections 10110.9 and 10144.565 to the Insurance Code.

The law mandates two things: 

1. You have 90 days to decide on a completed credentialing application and 10 business days to acknowledge it upon receipt. (Effective from January 1, 2027)
2. Starting in 2028, all health plans and credentialing delegates must use the CAQH form. (Effective from January 1, 2028)

It applies to full-service health care service plans, health insurers, and any delegate credentialing for their networks. The Department of Managed Health Care regulates the plans, and the Department of Insurance regulates the insurers. Medi-Cal managed care plans are completely exempt. 

Why Is California AB 1041 Important?

Abiding by AB 1041’s rules matters because:

1. Missing the deadline costs you control of your own network. The law states that a provider you haven't finished vetting gets treated as credentialed for the next 120 days.
2. The compliance burden sits with you. Once a provider submits a complete application, it’s up to the health plan or credentialing delegate to meet AB 1041's timelines and process requirements. 
3. Noncompliance becomes a regulatory issue. Because AB 1041 adds these requirements to the Knox-Keene Act, they fall under the same regulatory framework that already governs California health plans, giving the DMHC authority to enforce them.

6 Ways to Get Ready for AB 1041 Before the Deadlines

Want to prepare in advance to ensure full compliance? Here are 6 tips to start applying now so you are used to them. 

1. Log Every Application the Day It Arrives

You've got 10 business days from receipt to confirm you received the application and say whether it's complete. That's a short window, and it runs on business days. A file sitting in a shared inbox over a holiday week eats most of it.

Build a triage step that stamps every application with its receipt date on day one. Check it against a required-documents list, then send the completeness notice inside the window. One person should own that clock to ensure it always gets done. 

This step matters more than it looks because it's also where your 90-day clock starts. Sit on an incomplete file without telling the provider, and you've broken the law before the main deadline even starts.

2. Run Two Clocks, Because Behavioral Health Applications Have a Different Deadline 

The 90-day rule doesn't apply to everyone in your network. Section 1374.198 opens with "Except as provided in Section 1374.197." That older section came in with AB 2581 in 2022, and it already covers mental health and substance use disorder providers.

Under that rule, a completed application from a behavioral health provider gets 60 days for assessment and verification. That's been the standard for behavioral health provider contracts issued, amended, or renewed since January 1, 2023.

Beginning in 2027, you will need to manage two distinct timelines simultaneously. If your workflow processes all files identically, behavioral health applications will inadvertently miss their specific deadline by 30 days. Categorize these applications during intake to ensure they are processed according to the accelerated timeframe.

3. Get Files to "Complete" in Days, Not Weeks

The 90 days don't start when a provider hits send. It starts once you have a completed application, with the required third-party verifications in hand. A file that's still waiting on a license check or a malpractice history hasn't started its 90 days.

That sounds like slack in the system, but the 10-day notice closes it. You still have to tell the provider what's missing within those 10 business days, so you can't park a file quietly and stop time.

So the fix is to shorten the gap between received and complete". When you run verifications one after another, that gap widens because each source you have to verify operates on its own schedule.

At Assured, our credentialing platform runs primary source verifications in parallel across more than 2,000 continuously monitored sources. Files reach committee-ready in about two days. When one source is slow, we escalate that exception to your team and keep the rest of the file moving. For a plan working to a 90-day limit, that turns completeness from your biggest unknown into a predictable few days, helping you meet both the notice and credentialing deadlines easily. 

4. Decide Now What Happens on Day 75

Provisional approval happens automatically. You don't apply for it, and nobody grants it. If the 90-day deadline is missed, the provider's credentials are provisionally approved for the next 120 days.

Three narrow exceptions keep it from applying. Provisional approval is off the table if the applicant:

• is subject to discipline by their licensing entity,
• has one or more adverse action reports or malpractice payment reports filed with the National Practitioner Data Bank, or
• hasn't been credentialed by the plan in the past five years.

You can only rely on an exception if you already know it applies, and you won't know that on day 89. So run your sanctions and exclusion screening early, using Assured’s and NPDB-reported actions, and a disqualifying flag will surface in week one. 

Then set an internal escalation at day 75. That gives you two weeks to force a decision while you still control the outcome.

5. Move to the CAQH Form Early, and Plan for the Questions You Won’t be Able to Ask

As of January 1, 2028, full-service health plans and their credentialing delegates must subscribe to CAQH and use the most recent version of the CAQH credentialing form. 

This rule means you can only ask questions on the form, and any additional information you request from a provider must be to clarify or confirm what’s already on the CAQH form. You won’t be able to use custom supplemental questionnaires that ask for anything beyond that. 

So audit your intake packet against the CAQH form this year. Anything you collect that the form doesn't cover needs a decision. Either drop it or pick it up through primary source verification, since you won’t be able to ask the provider for it soon. 

And once you are CAQH-based, most of the remaining work is data hygiene. Since you’ll have less flexibility to collect additional information through custom questionnaires, missing or outdated CAQH data can create delays during credentialing. Start cleaning up provider identifiers and enrollment data now, from the NPI to the PECOS enrollment, and make sure CAQH attestations stay current every 120 days. 

6. Pressure-Test The Work Delegated to You 

AB 1041 names plans, insurers, "or its delegate" throughout. If you're a delegated entity or a CVO, the 90-day clock, the 10-day notice, and the provisional-approval rule all apply to the files you touch. The plan that delegated the work to you still answers for it and needs to secure evidence that you can hold both clocks.

So have your turnaround data ready before a plan asks for it. To do this, start by pulling your last twelve months of decision times, split into behavioral health and everything else. If your median already runs past 60 or 90 days, you have a staffing or sequencing problem that needs to be worked on before the law kicks in.

And after you achieve the goal turnarounds, practice continuous monitoring to keep that answer current between audits. Assured can help with this. We monitor provider data in real time, so you can gain visibility into credentialing timelines, provider status, and data changes as you navigate this change. 

Where to Start This Quarter

Working backward from January 1, 2027, the rest of 2026 is your window to make these changes. The plans and delegates who'll be comfortable in 2027 are the ones fixing intake and verification now, while a missed deadline still costs them nothing.

Stamp and triage applications on day one. Split your queue so that behavioral health runs on a 60-day cycle. Then, shorten the time a file takes to complete.

And if you'd rather not rebuild verification in-house, that's the work we take on at Assured. We credential providers in about 48 hours as an NCQA-certified CVO, well inside either clock. Whether you are a health plan or a delegated entity, Assured will help you reduce verification delays, maintain accurate provider data, and build workflows that meet the new requirements of AB 1041. 

Book a demo so we can walk you through what your customized AB 1041 readiness plan should look like.

FAQs

1. When Does AB 1041 Take Effect?

The 90-day determination, the 10-business-day acknowledgment, and provisional approval will start on January 1, 2027. The CAQH credentialing form requirement will follow on January 1, 2028. You currently have the remainder of 2026 and 2027 to rebuild intake and verification before the first stage arrives.

2. Who Has to Comply With AB 1041?

Full-service health care service plans, health insurers, and any delegate that credentials providers for their networks. That includes delegated entities and CVOs doing the work under contract. Medi-Cal managed care plans are exempt. The plan stays accountable for a delegate's performance, so both sides carry the same deadline.

3. What Happens if a Plan Misses the 90-day Credentialing Deadline?

The provider's credentials are provisionally approved for 120 days. Three exceptions block that from happening. Those exceptions apply to an applicant who is under discipline by their licensing entity, has adverse action or malpractice payment reports in the NPDB, or is a provider the plan hasn't credentialed in the past five years.

4. Does the 90-Day Rule Apply to Behavioral Health Providers?

No. Section 1374.198 carves out Section 1374.197, which has covered mental health and substance use disorder providers since January 1, 2023. Those applications carry a 60-day assessment and verification deadline, so behavioral health files run on a tighter clock than the rest of your queue.

5. What Does AB 1041 Change About the Credentialing Form?

From January 1, 2028, covered plans and delegates must subscribe to CAQH and use the most recent version of its credentialing form. You may also only ask a provider for additional information that clarifies or confirms what's already on that form, which rules out custom supplemental questionnaires.