California SB 729 and Surrogacy: What Intended Parents Need to Know About Their New Insurance Rights

Surrogacy in California costs $120,000 to $200,000 or more. The first question most intended parents ask is a simple one: how much can health insurance cover?

California Senate Bill 729 changes that calculation. Understanding what SB 729 surrogacy coverage includes, and where it stops, can shift how you budget and plan before your first clinic appointment.

The law does not cover your surrogate’s compensation, agency fees, or legal costs, but it covers more of the fertility clinic portion than most intended parents realize, and that difference matters when you are looking at six-figure total costs. This guide focuses specifically on what SB 729 means for intended parents working with a gestational carrier, including what’s covered, what’s not, who qualifies and how to check coverage with your insurance.

What SB 729 covers for intended parents pursuing surrogacy

Senate Bill 729 requires fully insured large group health insurance plans to provide coverage for the diagnosis and treatment of infertility and fertility services, including the in vitro fertilization process used to create embryos for transfer to a gestational carrier. The intended parent’s treatment of infertility is what the law covers, not the surrogate’s medical care.

Certain health insurance plans are required by law to offer coverage for infertility services, including fertility treatments for intended parents working with a gestational carrier. Insurers cannot use an insurance contract to deny fertility services based on a covered individual’s participation in fertility services provided by or to a third party. A surrogate or gestational carrier qualifies as that third party. If your health plan qualifies, the presence of a surrogate is not a valid reason to deny a covered health care service.

Under a qualifying large group plan, the law requires insurers to cover the following:

• Diagnostic testing and infertility evaluation, including review of your medical and reproductive history.
• Fertility medications, including injectable hormones and other prescription medications used throughout the IVF process; insurers cannot apply different cost-sharing rules to fertility drugs than to other prescriptions.
• Egg retrieval, up to three completed retrievals for the intended parent.
• Embryo creation via in vitro fertilization, including fertilization procedures.
• Embryo transfer to the gestational carrier, with unlimited embryo transfers covered (one at a time, when single embryo transfer is medically appropriate per ASRM guidelines).

To put that in dollar terms: a single IVF cycle costs $15,000 to $25,000 out of pocket without IVF coverage. Senate Bill 729 can cover the fertility care and medically necessary treatment at the fertility clinic. That is the fertility clinic bill, not the surrogacy arrangement as a whole.

The fertility clinic steps that Senate Bill 729 should cover in your surrogacy journey

Most intended parents come to their first consultation with a rough sense of what surrogacy costs in total. Fewer know exactly which line items on the fertility clinic’s side of that bill their health insurance is expected to cover. This section walks through each fertility treatment step in order.

Pre-treatment evaluation and diagnostic testing

Before embryo creation begins, the intended parent goes through a full fertility evaluation at the clinic. Depending on your situation, this includes bloodwork, hormonal panels, ultrasounds, uterine cavity assessment, and semen analysis if the intended father’s sperm is being used.

The senate bill requires coverage for this evaluation phase. Under the law, a licensed physician’s findings from a review of your medical history and other clinical factors constitute the covered infertility assessment. This evaluation is not a separate billable item that falls outside the mandate.

Many intended parents assume this workup comes out of pocket. Under a qualifying plan, it should be covered. Confirm with your insurer before your first appointment so there are no surprises on the explanation of benefits.

Egg retrieval, fertilization, and embryo creation

The IVF cycle to create embryos involves ovarian stimulation with fertility medications, monitoring appointments, the egg retrieval procedure itself, fertilization (using ICSI or standard in vitro fertilization), embryo development in the lab, and optional preimplantation genetic testing.

SB 729 covers up to three completed egg retrievals under qualifying large group plans. Each completed retrieval counts toward that limit. Fertility medications throughout this process must be covered on the same terms as other prescription medications; your insurer cannot create a separate, higher cost-sharing tier specifically for fertility drugs.

One nuance that matters for gay male couples and some intended mothers: if you are using a donor’s eggs rather than your own, coverage for the donor’s retrieval is not automatically guaranteed under the law. The mandate covers the intended parent’s own fertility treatments and infertility services; donor agency fees and donor compensation are explicitly excluded. If donor egg IVF is part of your plan, ask your insurer specifically whether they will cover IVF using donor eggs and get the answer in writing before the cycle begins.

Embryo transfer to the gestational carrier

This is the step where the embryo, created from the intended parent’s or donor’s genetic material, is transferred to the surrogate’s uterus. Under the law, this procedure is classified as part of the intended parent’s infertility treatment, not the surrogate’s medical care.

The legal principle here is plain: the law prohibits insurers from denying coverage for fertility services provided by or to a third party, and a gestational carrier qualifies as that third party. The surrogate’s role in the treatment of infertility does not give the insurer grounds to deny the procedure.

Unlimited embryo transfers are covered under qualifying health plans (one per attempt, when single embryo transfer is medically appropriate per ASRM guidelines). If the first attempt does not result in a pregnancy, additional transfers are covered within your plan’s terms without requiring a new egg retrieval cycle, provided viable frozen embryos remain.

What SB 729 does not cover in a surrogacy journey

The senate bill is a genuine expansion of fertility coverage rights in California. It also comes with clear coverage limitations, and intended parents are better served knowing those limits upfront than discovering them mid-process.

The law does not require insurers to cover the surrogate’s costs or the non-medical elements of the surrogacy arrangement. Here is what falls outside the mandate:

• Gestational carrier compensation, typically $40,000 to $60,000 or more.
• Surrogacy agency fees, typically $20,000 to $35,000 or more.
• Legal fees for drafting and executing the surrogacy contract.
• The gestational carrier’s prenatal care, delivery, and obstetric costs, which require a separate health insurance policy for the surrogate.
• Newborn hospital expenses.
• The surrogate’s insurance premiums, which intended parents typically pay out of pocket as part of the surrogacy arrangement.

Even with SB 729 covering the fertility clinic portion, intended parents should budget at least $100,000 in additional costs overall. The law reduces what you pay at the fertility clinic. It does not restructure the surrogacy financial model.

That framing matters when you are planning. The law’s insurance coverage is most valuable in the early clinical phases: the diagnostic workup, the IVF cycle, and the embryo transfers. Those are real savings. The larger cost drivers in surrogacy sit outside the insurance mandate entirely.

Does your health insurance plan qualify under SB 729?

The coverage the law provides is real, but it only applies if your specific plan falls within its scope. Two intended parents at different companies, both in California, can have very different answers to this question.

Plans that must provide surrogacy-related fertility coverage

The law applies to fully insured large group health insurance plans covering 101 or more employees. “Fully insured” means the insurance company bears the financial risk of paying claims, as opposed to self-funded health plans where the employer pays claims directly.

If your employer is headquartered outside California but you are a California resident, the plan must still comply. Location of the employer does not create an exemption; coverage of California residents does.

Timing matters too. Most health insurance plans do not automatically switch on January 1, 2026. SB 729 coverage takes effect at your plan’s first renewal date on or after January 1, 2026, expanding health insurance coverage for fertility treatments at that point. Depending on when your employer’s plan renews, your health insurance coverage may begin mid-2026.

Small group health insurance policies work differently. Insurers are required to offer coverage for infertility as an option, but it is not automatic. It may require an additional rider that your employer has to elect. If you are on a small group plan, ask HR whether that option was chosen.

The law requires insurers to provide the same infertility benefits regardless of marital status, gender identity, or domestic partner status. All qualifying health plans must apply these insurance protections equally. Certain health insurance plans cannot impose different terms or conditions based on any of those characteristics.

Plans exempt from SB 729 requirements

Self-funded employer plans are the most consequential exemption. According to the KFF 2025 Employer Health Benefits Survey, approximately 67% of covered workers in the US are enrolled in self-funded arrangements. That means the majority of people with employer-sponsored insurance are on plans that California’s mandate cannot touch, because self-funded employer plans are governed by federal ERISA law, not state insurance law. Verify this with HR before assuming the law applies to you.

Level-funded plans are a common hybrid that trips up many intended parents. In a level-funded arrangement, the employer self-funds claims up to a stop-loss threshold and uses an insurer for costs above that. From the employee’s perspective, it often looks and feels like a standard insured plan. Whether the new insurance protections under SB 729 apply depends on how the plan is legally classified. Do not assume from your plan materials alone. Ask HR the specific question: “Is our plan fully insured, self-funded, or level-funded?”

Other exempt plan types include:

• Federal health plans, including TRICARE and federal employee benefit programs.
• Public employee health plans, including CalPERS (exempt until July 1, 2027).
• Certain religious employers and religious organizations with qualifying exemptions.
• Medi-Cal managed care plans.
• Specialized healthcare service plan contracts.
• Disability insurance policies issued outside California’s large-group framework.

If your plan falls into any of these categories, talk to your fertility clinic about self-pay pricing and whether any partial insurance coverage applies. Many fertility clinics have experience navigating coverage for patients on exempt plans.

Who qualifies under the new Senate Bill 729 infertility definition

The senate bill did not just expand what insurers must cover. It changed the definition of infertility under California law. That change matters most for the people who need surrogacy as a path to parenthood.

The old definition and why it left many intended parents unprotected

Before SB 729, the insurance definition of infertility in California required proof of 6 to 12 months of unprotected intercourse failing to result in pregnancy. On its face, that sounds like a clinical standard. In practice, it excluded a large portion of the people who pursue surrogacy.

Gay male couples cannot meet an intercourse-based test by definition. Single individuals cannot either. Women who have had a hysterectomy, those with congenital uterine anomalies, and those with recurrent pregnancy loss from uterine causes are not going to produce a pregnancy through intercourse regardless of how long they try. Under the old definition of infertility, insurers could deny all of them coverage because they did not satisfy the intercourse requirement. The law recognized inability to conceive through intercourse, not a person’s inability to carry a pregnancy or reproduce without medical intervention.

The new definition and who it now covers

The new definition of infertility under Senate Bill 729 can be established through a licensed physician’s findings from a clinical assessment: a review of medical history and other relevant factors the physician identifies.

There is no intercourse requirement. The law recognizes that a person’s inability to reproduce alone or with a partner without medical assistance is sufficient grounds for a diagnosis. A physician’s finding to that effect is what qualifies a patient for coverage, not a record of failed attempts at intercourse.

For intended parents pursuing surrogacy, this directly benefits:

• Single individuals who want to use a gestational carrier
• Same-sex couples, to whom no intercourse-based test applies
• Women with uterine factor infertility, including those who have had a hysterectomy, experienced DES exposure, have a congenital uterine anomaly, or have experienced recurrent pregnancy loss from uterine causes
• Cancer patients and others whose medical treatment affects fertility, including those who have undergone chemotherapy or radiation; the law explicitly covers individuals undergoing medical treatment that affects their ability to reproduce, including those who need fertility preservation before cancer treatment begins

SB 729 protections for LGBTQ+ intended parents pursuing surrogacy

For LGBTQ+ families, and particularly for gay male couples who need both an egg donor and a gestational carrier, the senate bill represents a meaningful shift in the insurance protections available for fertility treatments.

The law’s anti-discrimination provisions are explicit. Insurers cannot deny infertility coverage based on sexual orientation, gender identity, or domestic partner status. These are not general principles; they are written into the statute as requirements. An insurer applying different terms or benefit structures to an LGBTQ+ intended parent than to a heterosexual married couple is in violation of California law.

The third-party provision extends those new insurance protections into the surrogacy context. SB 729 explicitly covers fertility services that involve sperm donors, egg donors, and gestational carriers. A gay male couple’s intended parent can use their qualifying health insurance for the fertility clinic portion of surrogacy: the egg retrieval, fertilization, and the transfer procedure to the surrogate. The same infertility benefits that apply to any other covered patient apply to them.

Before the law changed, an insurer could deny an LGBTQ+ intended parent on the grounds that they had not attempted intercourse or did not meet the prior definition of infertility. That gap is now closed. CCRH has served LGBTQ+ families throughout its 20+ years in practice. This is a patient population the clinic knows well, and one that now has stronger legal coverage protections than at any point in California’s history.

How to confirm your SB 729 coverage before starting surrogacy

The steps below apply to most fertility insurance plans, but going in prepared saves time and prevents surprises once treatments are underway.

1. Ask HR one question first: “Is our health insurance plan fully insured, self-funded, or level-funded?” This determines whether the law applies at all. If you do not know the answer, you cannot assume insurance coverage exists. Get this answer before anything else.
2. If your plan is fully insured and covers 101 or more employees, ask for your plan’s first renewal date on or after January 1, 2026. Your health insurance coverage under the law starts then, not when the senate bill passed.
3. Ask specifically about infertility and IVF coverage: “Does our plan offer coverage for the diagnosis and treatment of infertility, including IVF and embryo transfer procedures, under SB 729?” General confirmation that the plan “covers fertility” is not enough. You want confirmation of the specific infertility services.
4. Ask about third-party coverage: “Does the plan cover fertility services that involve a third party, such as a gestational carrier or surrogate?” Some insurers comply with the general IVF mandate but have not updated their claims processing to reflect the third-party provision. Ask directly.
5. If you are using donor eggs, ask a separate question: “Does the plan cover IVF using donor eggs?” The mandate covers the intended parent’s own fertility treatments; donor egg coverage varies by plan and is not automatic under the law.
6. Get all confirmations in writing. An email from HR or a written statement from the insurer protects you if a claim is later disputed. Verbal confirmation does not.
7. If you receive a denial, request the specific reason in writing. If the insurer is denying coverage because a surrogate is involved, or citing your sexual orientation or marital status, that denial may violate California law. A fertility clinic experienced in insurance disputes can help you understand your options.

Our team can help you review your benefits and understand what your health insurance policies cover before treatment begins. Bringing your insurance information to your initial consultation means you can ask specific questions and get clarity before any cycle begins.

Talk to a surrogacy-experienced fertility team today

Here is what the law means in practice for intended parents pursuing surrogacy:

• When your plan qualifies, SB 729 covers the intended parent’s diagnostic workup, egg retrieval, embryo creation, embryo transfer, and fertility medications
• LGBTQ+ intended parents have explicit anti-discrimination protections; the law prohibits denying infertility coverage based on sexual orientation, gender identity, or domestic partner status
• The expanded definition of infertility means more people qualify for treatment of infertility, including those who need surrogacy due to uterine factor, prior cancer treatment, or same-sex partnership
• Self-funded ERISA plans and level-funded plans may be exempt; verify your plan type with HR before assuming SB 729 coverage applies

Surrogacy means coordinating between an agency, a surrogate, and a fertility clinic at the same time. CCRH guides intended parents through the medical side of that process, and our team can help you make sense of your coverage options at your initial consultation.

With over 20 years serving Los Angeles-area families, a dedicated LGBTQ+ fertility program, and comprehensive gestational surrogacy services, we advise intended parents on their fertility treatment options and the infertility services available at the clinic. Schedule an appointment with one of our specialists today to discuss your surrogacy options and how to use your SB 729 benefits.