Patients as stakeholders in healthcare is the legal reality embedded in a California bill you’ve probably never heard of. It’s called AB 2398, the California Physician Graduate License Act, and this bill deserves your attention if you’re in medical school, a practice manager, a patient, a caregiver, or a patient advocate trying to navigate around California’s deepening physician shortage.
For the first time in recent memory, the state’s legislature has given patient advocacy groups a formal seat at the table where medical licensing policy is written. The window of opportunity to secure that seat is currently open.
Patients as Stakeholders in Healthcare: What AB 2398 Originally Aimed to Fix
Assembly Member David Alvarez (D‑San Diego) introduced AB 2398 in February 2026 as a licensing bill, not a study. The Physician Graduate License Act created a legitimate, supervised licensing pathway for unmatched medical school graduates, both U.S. and internationally trained, who have passed all core licensing exams but couldn’t land a residency slot.
Thousands of medical school graduates (MSGs) go unmatched every year. Over 9,541 applicants couldn’t find matches in 2025, and that figure includes 2,409 soon‑to‑be graduates of U.S. medical schools. California is currently staring down a physician shortage that reached 3,490 full‑time equivalents last year, and it’s projected to balloon to 10,500 by 2030.
[Related: What Percentage of IMGs Match Into Residency?]
AB 2398 originally aimed to let unmatched graduates practice under a supervising physician, detailing supervision requirements, patient disclosure rules, fee structures, and scope-of-practice boundaries.
AB 2398 was a concrete mechanism to address a broken match system. Patients, as stakeholders in the healthcare system, understand that increasing the number of licensed clinicians expands access and reduces wait times.
When a Licensing Pathway Turns Into a Study Group
By mid‑April 2026, a committee amendment had stripped out the licensing framework entirely and replaced it with a workgroup. The Department of Health Care Access and Information (HCAI) must convene the group by January 1, 2028, and deliver a report to the Legislature by July 1, 2028.
The kicker here is that the entire bill self-destructs on Jan 1, 2030. This is the study-bill maneuver, a recognized legislative technique that produces a report the Legislature is not obliged to act on. It’s the legislative equivalent of saying, “We’ll think about it later.”
The amendment was a gut punch for unmatched medical school graduates hoping for a pathway into practice. Instead of getting an intermediary license to practice at even a basic level with heavy supervision, they ended up with more homework as they continue to be sidelined in an all-or-nothing system in the US, where US medical graduates who did not place into residency cannot even order lab work for primary care patients.
While the workgroup will examine “residency capacity” and “barriers to entry,” including for international medical graduates, there are no guarantees that any recommendation it makes will ever become law.
AB 2386: The International Pathway That’s Actually Gaining Traction
While AB 2398 was being converted into a study, AB 2386, the California Physician Expansion Act, was advancing with little resistance. This bill expands and streamlines pathways specifically for internationally licensed physicians, particularly those from Mexico who have already completed the Licensed Physicians from Mexico Program.
It also issues a new provisional license for qualified international physicians from any country, valid for 3 years with a possible extension, leading to a full, unrestricted license after 3 years of supervised practice.
The contrast is hard to miss: California’s legislative appetite appears stronger for pathways serving internationally licensed physicians than for those addressing the structural bottleneck that leaves thousands of U.S.‑trained, unmatched medical school graduates in limbo every year.
The House Judiciary Committee has documented why that bottleneck exists. The 1997 Balanced Budget Act froze federally funded residency positions, and despite a modest 2020 increase, the residency cap remains wildly out of step with demand. Fixing it requires federal action, and Congress isn’t rushing to address it.
State legislators, in turn, reach for what they can change: international licensing compacts and provisional pathways. This is the political reality, and it leaves unmatched medical school graduates in the U.S. and the patients who need them waiting.
In other words, each time that we hear messaging on poaching the best of the best in medical talent from other countries, what we are also hearing is that our state and federal governments are putting a Band-Aid on the problem and not addressing the root issue of how these governments have drastically failed and underutilized homegrown talent.
In an ideal world, there would be a pathway for qualified international talent, but we would also, first and foremost, not be failing US citizens who wanted to serve their communities but got trapped in the bottleneck. To rectify this issue would require examining vested interests and dismantling monopolies.
The Opening for Patient Advocacy (Yes, You’re Invited)
An interesting fact about the AB 2398 workgroup you should know is that subdivision (b)(8) explicitly includes “consumer and patient advocacy organizations” as eligible participants. That’s a formal, documented invitation. The workgroup will produce recommendations on residency capacity, geographic and specialty maldistribution, and the feasibility of supervised practice pathways for unmatched medical school graduates. Those recommendations land on the Legislature’s desk in mid‑2028.
This is a rare opportunity for patient advocacy organizations focused on chronic or rare diseases, pain management, behavioral health, rural health access, or other critical areas to directly influence the workgroup's recommendations and shape legislation that affects millions of Californians' access to physician care.
California is the largest physician market in the country. What happens in this workgroup can influence model legislation, state budgets, and the broader conversation about medical education reform.
If you’ve ever muttered, “They should ask patients before they decide physician licensing policy,” this is your chance to be in the room where it happens.
Where This Leaves California’s Physician Shortage
The physician shortage in California won’t fix itself. Additional residency slots and innovative licensing pathways are needed.
AB 2398, in its original form, tried to build that bridge, and AB 2386 is building a different one. Both bills agree on one point: the status quo isn’t cutting it. Your voice can help influence policies that impact primary care access, chronic pain management, and rural health, giving communities a real say in shaping healthcare.
If You Want a Seat at the Table
We're tracking both bills closely and connecting patient advocates to the AB 2398 workgroup and the broader conversation on medical education reform. We have internal insight from a US medical school graduate working tirelessly behind the scenes on bills across multiple states, including this recent California bill, to increase alternative licensing pathways for sidelined medical school graduates.
Subscribe to our Newsletter to stay informed about upcoming deadlines, public comment opportunities, and how you can actively participate in shaping the workgroup's recommendations. Use our Contact Form to connect with us if you represent or are connected to a patient advocacy organization that should be involved in this process.
The physician shortage means patients, as stakeholders in their healthcare, aren’t getting the care they need. It’s time for legislators to listen to them.
