Require healthcare providers to use profits from medicines for patient care

Proposal 34 would direct certain health care providers in California to spend at least 98% of revenue from discount drug sales directly on patient care, according to the state’s voter guide. Non-compliant providers may lose their state licenses, tax exemptions and government contracts.

This rule only applies to providers with more than $100 million in non-health care expenses, real estate ownership, and a history of at least 500 health violations.

Proposition 34 takes aim at the AIDS Healthcare Foundation, led by Michael Weinstein, which has faced opposition for spending on housing policy over patient care. The funding for Prop. 34 comes largely from the California Apartment Association, an active opponent of Weinstein.

Supporters argue that Prop. 34 would increase transparency and ensure that patient revenues are not diverted elsewhere. Opponents argue the measure unfairly singles out one organization and faces constitutional challenges.