Adds to existing law to establish the Merit-Based Health Care Act.

LEGISLATURE OF THE STATE OF IDAHO
Sixty-eighth Legislature Second Regular Session - 2026
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 828
BY HEALTH AND WELFARE COMMITTEE
AN ACT	1
RELATING TO THE MERIT-BASED HEALTH CARE ACT; AMENDING TITLE 56, IDAHO CODE,	2
BY THE ADDITION OF A NEW CHAPTER 25, TITLE 56, IDAHO CODE, TO PROVIDE	3
A SHORT TITLE, TO PROVIDE LEGISLATIVE FINDINGS AND INTENT, TO DEFINE	4
TERMS, TO ESTABLISH PROVISIONS REGARDING PROHIBITED ACTS, TO ESTABLISH	5
PROVISIONS REGARDING MEDICAID CONTRACTUAL COMPLIANCE, TO ESTABLISH	6
PROVISIONS REGARDING ENFORCEMENT AND PENALTIES, TO ESTABLISH PROVI-	7
SIONS REGARDING A LIMITED PRIVATE RIGHT OF ACTION, AND TO ESTABLISH	8
PROVISIONS REGARDING FEDERAL PREEMPTION; AND DECLARING AN EMERGENCY	9
AND PROVIDING AN EFFECTIVE DATE.	10
Be It Enacted by the Legislature of the State of Idaho:	11
SECTION 1. That Title 56, Idaho Code, be, and the same is hereby amended	12
by the addition thereto of a NEW CHAPTER, to be known and designated as Chap-	13
ter 25, Title 56, Idaho Code, and to read as follows:	14
CHAPTER 25	15
MERIT-BASED HEALTH CARE ACT	16
56-2501. SHORT TITLE. This chapter shall be known and may be cited as	17
the "Merit-Based Health Care Act."	18
56-2502. LEGISLATIVE FINDINGS AND INTENT. (1) The legislature finds	19
that:	20
(a) Medicaid participation is voluntary and subject to reasonable con-	21
ditions imposed by the state as a steward of public funds;	22
(b) Employment decisions based on merit and professional qualifica-	23
tions promote patient trust and high-quality care; and	24
(c) Employment practices unrelated to job-related qualifications or	25
business necessity undermine program integrity, workforce competency,	26
and the efficient use of public funds.	27
(2) It is the intent of the legislature to:	28
(a) Ensure that health care employment and contracting decisions	29
funded by medicaid are based on individual merit, qualifications, and	30
clinical competency;	31
(b) Prohibit the use of state medicaid funds to support ideological or	32
discriminatory employment practices; and	33
(c) Preserve compliance with all applicable federal civil rights and	34
medicaid requirements.	35
(3) Nothing in this chapter is intended to authorize discrimination	36
prohibited by federal law or to interfere with patient-specific medical	37
decision-making.	38
56-2503. DEFINITIONS. As used in this chapter:	39

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2
(1) "Discriminatory hiring" means granting a preference or imposing a	1
disadvantage in employment or contracting based on race, sex, sexual orien-	2
tation, gender identity, or national origin, except as expressly required by	3
federal law.	4
(2) "Diversity, equity, and inclusion" or "DEI" means the policies com-	5
monly known and practiced as DEI, critical race theory, or anti-racism, any	6
form of race or sex stereotyping or scapegoating, or the concepts that:	7
(a) One race or sex is inherently superior to another race or sex;	8
(b) The United States is fundamentally racist or sexist;	9
(c) An individual, by virtue of the individual's race or sex, is in-	10
herently racist, sexist, or oppressive, whether consciously or uncon-	11
sciously;	12
(d) An individual should be discriminated against or receive adverse	13
treatment solely or partly because of the individual's race or sex;	14
(e) Members of one race or sex cannot and should not attempt to treat	15
others without respect to race or sex;	16
(f) An individual's moral character is necessarily determined by the	17
individual's race or sex;	18
(g) An individual, by virtue of the individual's race or sex, bears re-	19
sponsibility for actions committed in the past by other members of the	20
same race or sex;	21
(h) An individual should feel discomfort, guilt, anguish, or any other	22
form of psychological distress on account of the individual's race or	23
sex;	24
(i) Meritocracy or traits such as a hard work ethic are racist or sexist	25
or were created by a particular race to oppress another race; or	26
(j) All people should be compelled to believe in and speak in a manner	27
consistent with the concept that an individual can change the individ-	28
ual's sex or gender.	29
(3) "Health care provider" means any individual or entity that volun-	30
tarily participates in the Idaho medicaid program or receives medicaid reim-	31
bursements in whole or in part through a state-contracted managed care net-	32
work.	33
(4) "Prohibited DEI conduct" means any policy, practice, training, or	34
requirement that includes:	35
(a) Consideration of DEI in hiring, promotion, compensation, disci-	36
pline, termination, or contracting decisions;	37
(b) Race-based or sex-based preferences, targets, benchmarks, quotas,	38
or equity goals;	39
(c) Mandatory bias, implicit bias, systemic bias, or similar training	40
that assigns responsibility, disadvantage, or professional outcomes	41
based on protected characteristics rather than individual merit or per-	42
formance; or	43
(d) Required statements, pledges, attestations, or affirmations en-	44
dorsing diversity, equity, and inclusion principles or related ideo-	45
logical frameworks as a condition of employment or contracting.	46
(5) "Public-facing communication" means any communication made avail-	47
able to the public, including marketing materials, websites, mission or	48
value statements, publicly presented staff trainings, facility signage, or	49
social media.	50

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56-2504. PROHIBITED ACTS. (1) With respect to employment, policies,	1
training, or communications, a health care provider shall not:	2
(a) Engage in discriminatory hiring or prohibited DEI conduct;	3
(b) Adopt or implement internal policies or trainings that constitute	4
prohibited DEI conduct; or	5
(c) Use state funds, including medicaid reimbursements, for any pub-	6
lic-facing communication that promotes prohibited DEI conduct.	7
(2) Nothing in this section shall be construed to prohibit:	8
(a) Compliance with title VI of the civil rights act of 1964 or other	9
applicable federal civil rights laws;	10
(b) Collection of demographic data for legitimate clinical care, qual-	11
ity reporting, or public health purposes;	12
(c) Patient-specific medical discussions related to biological, ge-	13
netic, or epidemiological risk factors;	14
(d) Non-ideological training required for clinical competency, licen-	15
sure, accreditation, or federal program compliance; or	16
(e) Workforce training, quality improvement initiatives, or dispar-	17
ity-reduction programs required or encouraged by federal law, centers	18
for medicare and medicaid services guidance, or accreditation bodies.	19
56-2505. MEDICAID CONTRACTUAL COMPLIANCE. (1) Compliance with this	20
chapter shall be a material condition of all Idaho medicaid provider agree-	21
ments as applied to medicaid-funded activities.	22
(2) The department of health and welfare shall ensure that all managed	23
care contracts require network-wide compliance with the provisions of this	24
chapter for medicaid-funded activities.	25
(3) This section shall be implemented in a manner consistent with fed-	26
eral medicaid requirements and centers for medicare and medicaid services	27
guidance.	28
56-2506. ENFORCEMENT AND PENALTIES. (1) The attorney general may in-	29
vestigate alleged violations of this chapter upon receipt of a formal com-	30
plaint.	31
(2) Prior to the imposition of civil penalties, the department shall	32
provide written notice and an opportunity for corrective action.	33
(3) The attorney general may seek civil penalties for violations of	34
this chapter as follows:	35
(a) For a health care provider with fifty (50) or more employees:	36
(i) A penalty not to exceed ten thousand dollars ($10,000) for a	37
first violation;	38
(ii) A penalty not to exceed fifty thousand dollars ($50,000) for	39
a second violation; and	40
(iii) A penalty not to exceed one hundred thousand dollars	41
($100,000) for a third or subsequent violation; and	42
(b) For a health care provider with fewer than fifty (50) employees:	43
(i) A penalty not to exceed five thousand dollars ($5,000) for a	44
first violation;	45
(ii) A penalty not to exceed twenty-five thousand dollars	46
($25,000) for a second violation; and	47

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(iii) A penalty not to exceed fifty thousand dollars ($50,000) for	1
a third or subsequent violation.	2
56-2507. LIMITED PRIVATE RIGHT OF ACTION. A health care professional	3
may bring an action solely for retaliation arising from refusing to partici-	4
pate in prohibited DEI conduct. Remedies may include reinstatement, injunc-	5
tive relief, compensatory damages, and reasonable attorney's fees.	6
56-2508. SAVINGS CLAUSE AND FEDERAL PREEMPTION. Nothing in this chap-	7
ter shall be construed to restrict conduct required or encouraged by fed-	8
eral civil rights law, centers for medicare and medicaid services guidance,	9
or federal conditions of participation. If any provision of this chapter is	10
preempted by federal law, such provision shall be severed while the remain-	11
der remains in full force and effect.	12
SECTION 2. An emergency existing therefor, which emergency is hereby	13
declared to exist, this act shall be in full force and effect on and after	14
July 1, 2026.	15

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