Applications for hospital construction projects for which federal funds are requested shall be submitted to the department, and may be submitted by the state or any political subdivision thereof or by any public or nonprofit agency authorized to construct and operate a hospital. Each application for a construction project shall conform to federal and state requirements, and shall be submitted in the manner and form prescribed by the department.
Any county that applies for or accepts federal funds for any hospital does so on condition that the hospital for which assistance is requested and accepted, at all times during which it is operated, (a) shall be qualified for a license under Chapter 2 (commencing with Section 1250) of Division 2 (whether or not that chapter is otherwise applicable to the hospital), and be subject to inspection under that chapter to the same extent as are other hospitals to which that chapter applies; and (b) shall not restrict patients to those unable to pay for their care.
Source:
Section 129505, https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=HSC§ionNum=129505..