California lawmakers are preparing to vote on a significant bill aimed at regulating private equity investments in the health care sector. This proposal marks the first time the state has considered such regulations, although it includes exemptions for some of the largest players in the industry. The discussions surrounding this legislation have raised questions about the definition of 'hedge fund' within the context of health care investments. Key insights from legal experts suggest that increased scrutiny on private investment in health care could impact innovators and investors alike, as the state seeks to balance regulation with industry interests.