AB 927: Health facilities: nursing homes.
- Session Year: 2015-2016
- House: Assembly
- Latest Version Date: 2016-01-04
Existing law provides for the licensure and regulation of health facilities, as defined. A violation of those provisions is a crime. Existing law requires any person or government entity desiring a license for a health facility, approval for a special service, or approval to manage a health facility currently licensed as a general acute care hospital, acute psychiatric hospital, skilled nursing facility, intermediate care facility, or special hospital, that has not filed an application for a license to operate that facility, to file with the department a verified application containing specific information.
This bill would require the denial of an application under those provisions if the applicant fails to provide the requisite information or provide it in the form requested.
Existing law requires each applicant for a license to operate a skilled nursing facility or intermediate care facility to make certain disclosures regarding corporate governance and ownership to the State Department of Public Health. Existing law prohibits certain persons, as defined, from governing or owning a beneficial interest of 5% or more of a skilled nursing facility or intermediate care facility, as specified, without approval of the department.
This bill would expand those disclosure requirements and the provisions that prohibit certain persons from governing or owning a beneficial interest in a skilled nursing facility or intermediate care facility, as specified. The bill would establish provisions for the denial of an application under circumstances in which a person named in an application has governed or owned a facility that has violated the law during a certain timeframe, as specified, and would require the department to investigate whether an applicant has been subject to professional discipline.
Existing law requires the department to implement a consumer information service system regarding long-term care facilities.
This bill would revise the information the system is required to contain and would require it to be available on the Internet by March 1, 2016 2017.
Because this bill would require additional disclosures, of which a failure to disclose or a false disclosure would be a crime, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Existing law provides for the licensure and regulation of health facilities, as defined. A violation of those provisions is a crime. Existing law requires any person or government entity desiring a license for a health facility, approval for a special service, or approval to manage a health facility currently licensed as a general acute care hospital, acute psychiatric hospital, skilled nursing facility, intermediate care facility, or special hospital, that has not filed an application for a license to operate that facility, to file with the department a verified application containing specific information.
This bill would require the denial of an application under those provisions if the applicant fails to provide the requisite information or provide it in the form requested.
Existing law requires each applicant for a license to operate a skilled nursing facility or intermediate care facility to make certain disclosures regarding corporate governance and ownership to the State Department of Public Health. Existing law prohibits certain persons, as defined, from governing or owning a beneficial interest of 5% or more of a skilled nursing facility or intermediate care facility, as specified, without approval of the department.
This bill would expand those disclosure requirements and the provisions that prohibit certain persons from governing or owning a beneficial interest in a skilled nursing facility or intermediate care facility, as specified. The bill would establish provisions for the denial of an application under circumstances in which a person named in an application has governed or owned a facility that has violated the law during a certain timeframe, as specified.
Existing law requires the department to implement a consumer information service system regarding long-term care facilities.
This bill would revise the information the system is required to contain and would require it to be available on the Internet by March 1, 2016.
Because this bill would require additional disclosures, of which a failure to disclose or a false disclosure would be a crime, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Existing law provides for the licensure and regulation of health facilities, as defined. A violation of those provisions is a crime. Existing law requires any person or government entity desiring a license for a health facility, approval for a special service, or approval to manage a health facility currently licensed as a general acute care hospital, acute psychiatric hospital, skilled nursing facility, intermediate care facility, or special hospital, that has not filed an application for a license to operate that facility, to file with the department a verified application containing specific information.
This bill would require the denial of an application under those provisions if the applicant fails to provide the requisite information or provide it in the form requested.
Existing law requires each applicant for a license to operate a skilled nursing facility or intermediate care facility to make certain disclosures regarding corporate governance and ownership to the State Department of Public Health. Existing law prohibits certain persons, as defined, from governing or owning a beneficial interest of 5% or more of a skilled nursing facility or intermediate care facility, as specified, without approval of the department.
This bill would expand those disclosure requirements and the provisions that prohibit certain persons from governing or owning a beneficial interest in a skilled nursing facility or intermediate care facility, as specified. The bill would establish provisions for the denial of an application under circumstances in which a person named in an application has governed or owned a facility that has violated the law during a certain timeframe, as specified.
Existing law requires the department to implement a consumer information service system regarding long-term care facilities.
This bill would revise the information the system is required to contain and would require it to be available on the Internet by March 1, 2016.
Because this bill would require additional disclosures, of which a failure to disclose or a false disclosure would be a crime, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
This act shall be known as the Nursing Home Ownership Disclosure Act of 2015. 2016.
SEC. 2.Section 1265 of the Health and Safety Code is amended to read:1265.(a)Any person, political subdivision of the state, or governmental agency desiring a license for a health facility, approval for a special service under this chapter, or approval to manage a health facility currently licensed as a health facility, as defined in subdivision (a), (b), (c), (d), or (f) of Section 1250, that has not filed an application for a license to operate that facility shall file with the department a verified application on forms prescribed and furnished by the department, containing all of the following:
(1)The name of the applicant and, if an individual, whether the applicant has attained the age of 18 years.
(2)The type of facility or health facility.
(3)The location thereof.
(4)The name of the person in charge thereof.
(5)Evidence satisfactory to the department that the applicant is of reputable and responsible character. If the applicant is a firm, association, organization, partnership, business trust, corporation, or company, like evidence shall be submitted as to the members or shareholders thereof, and the person in charge of the health facility for which application for license is made. If the applicant is a political subdivision of the state or other governmental agency, like evidence shall be submitted as to the person in charge of the health facility for which application for license is made.
(6)Evidence satisfactory to the department of the ability of the applicant to comply with this chapter and of rules and regulations promulgated under this chapter by the department.
(7)Evidence satisfactory to the department that the applicant to operate a skilled nursing facility or intermediate care facility possesses financial resources sufficient to operate the facility for a period of at least 45 days. A management company shall not be required to submit this information.
(8)Each applicant for a license to operate a skilled nursing facility or intermediate care facility shall disclose to the department evidence of the right to possession of the facility at the time the application will be granted, which may be satisfied by the submission of a copy of applicable portions of a lease agreement or deed of trust. The names and addresses of any persons or organizations listed as owner of record in the real estate, including the buildings and the grounds appurtenant to the buildings, shall be disclosed to the department.
(9)Any other information as may be required by the department for the proper administration and enforcement of this chapter.
(10)Upon submission of an application to the department by an intermediate care facility/developmentally disabled habilitative or an intermediate care facility/developmentally disabled-nursing, the application shall include a statement of need signed by the chairperson of the area board pursuant to Chapter 4 (commencing with Section 4570) of Division 4.5 of the Welfare and Institutions Code. In the event the area board has not provided the statement of need within 30 days of receipt of the request from the applicant, the department may process the application for license without the statement.
(b)The information required pursuant to this section, other than individuals social security numbers, shall be made available to the public upon request, and shall be included in the departments public file regarding the facility.
(c)With respect to a facility licensed as a health facility, as defined in subdivision (a), (b), or (f) of Section 1250, for purposes of this section, manage means to assume operational control of the facility.
(d)Failure of an applicant to cooperate with the licensing agency in the completion of an application pursuant to this section shall result in the denial of the application. Failure of an applicant to cooperate means that the information required pursuant to this chapter and by regulations of the department has not been provided, or has not been provided in the form requested by the licensing agency, or both.
SEC. 3.Section 1265.3 of the Health and Safety Code is amended to read:1265.3.(a)For any individual or entity that seeks approval to operate or manage a health facility licensed pursuant to subdivision (a), (b), (c), (d), or (f) of Section 1250 and is subject to Section 1265, the department shall consider the following:
(1)To determine whether the applicant is of reputable and responsible character, the department shall consider any available information that the applicant has demonstrated a pattern and practice of violations of state or federal laws and regulations. The department shall give particular consideration to those violations that affect the applicants ability to deliver safe patient or resident care.
(2)To determine whether the applicant has the ability to comply with this chapter and the rules and regulations adopted under this chapter, the department shall consider evidence that shall include all of the following:
(A)If any, prior history of operating in this state any other facility licensed pursuant to Section 1250, and the applicants history of substantial compliance with the requirements imposed under that license, applicable federal laws and regulations, and requirements governing the operators of those facilities.
(B)If any, prior history of operating in any other state any facility authorized to receive Medicare Program reimbursement or Medicaid Program reimbursement, and the applicants history of substantial compliance with that states requirements, and applicable federal laws, regulations, and requirements.
(C)If any, prior history of providing health services as a licensed health professional or an individual or entity contracting with a health care service plan or insurer, and the applicants history of substantial compliance with state requirements, and applicable federal laws, regulations, and requirements.
(b)The department may also require the entity described in subdivision (a) to furnish other information or documents for the proper administration and enforcement of the licensing laws.
SEC. 4.Section 1267.5 of the Health and Safety Code is amended to read:1267.5.(a)(1)Each applicant for a license to operate a skilled nursing facility or intermediate care facility shall disclose to the state department the name and business address of each general partner if the applicant is a partnership, or each director and officer if the applicant is a corporation, and each person having a beneficial ownership interest of 5 percent or more in the applicant corporation or partnership.
(2)If any person described in paragraph (1) has served or currently serves as an administrator, general partner, trustee or trust applicant, sole proprietor of any applicant or licensee who is a sole proprietorship, executor, or corporate officer or director of, or has held a direct or indirect beneficial ownership interest of 5 percent or more in, any other skilled nursing facility or intermediate care facility in this state or any other state, in any community care facility licensed pursuant to Chapter 3 (commencing with Section 1500), or in any residential care facility for the elderly licensed pursuant to Chapter 3.2 (commencing with Section 1569), the applicant shall disclose the relationship to the state department, including the name and current or last address of the health facility, community care facility, or residential care facility for the elderly, and the date the relationship commenced and, if applicable, the date it was terminated.
(3)(A)If the facility is operated by, or proposed to be operated in whole or part under, a management contract, the names and addresses of any person or organization, or both, having an ownership or control interest of 5 percent or more in the management company shall be disclosed to the state department. This provision shall not apply if the management company has submitted an application for licensure with the state department and has complied with paragraph (1).
(B)If the management company is a subsidiary of one or more other organizations, the information shall include the names and addresses of the parent organizations of the management company and the names and addresses of any officer or director of the parent organizations. The failure to comply with this subparagraph may result in action to revoke or deny a license. However, once the information that is required under this subparagraph is provided, the action to revoke the license shall terminate.
(C)If the management company or parent organizations of the management company manage or previously managed any other skilled nursing facility or intermediate care facility in this state or any other state, any community care facility licensed pursuant to Chapter 3 (commencing with Section 1500), or any residential care facility for the elderly licensed pursuant to Chapter 3.2 (commencing with Section 1569), the applicant shall disclose the name and current or last address of the health facility, community care facility, or residential care facility for the elderly, and the date the management commenced and, if applicable, the date it was terminated.
(4)(A)If the applicant or licensee is a subsidiary of one or more other organizations, the information shall include the names and addresses of the parent organizations of the subsidiary and the names and addresses of any officer or director of the parent organizations.
(B)If the parent organizations of the subsidiary or applicant own or manage, or previously owned or managed, any other skilled nursing facility or intermediate care facility in this state or any other state, any community care facility licensed pursuant to Chapter 3 (commencing with Section 1500), or any residential care facility for the elderly licensed pursuant to Chapter 3.2 (commencing with Section 1569), the applicant shall disclose the relationship to the state department, including the name and current or last address of the health facility, community care facility, or residential care facility for the elderly, and the date the relationship commenced and, if applicable, the date it was terminated.
(C)If the information provided by the applicant indicates that the applicant is a professional licensed by the State of California, the department shall contact the appropriate licensing agency to obtain information about disciplinary actions taken against the licensee and to confirm that the applicant is a licensee in good standing.
(5)The applicant shall disclose the history of compliance and any history of noncompliance with any applicable state or federal law or regulation for each facility described in paragraph (2), subparagraph (C) of paragraph (3), and subparagraph (B) of paragraph (4) during the period in which any of the following apply:
(A)Any person described in paragraph (1) had a relationship to the facility.
(B)Any management company described in paragraph (3) managed the facility.
(C)Any parent organizations described in paragraph (4) had a relationship to the facility.
(D)This paragraph does not apply to applicants that are currently licensed as a health facility, as defined in subdivision (a), (b), or (f) of Section 1250.
(6)The information required by this subdivision shall be provided to the state department upon initial application for licensure, and any change in the information shall be provided to the state department within 30 calendar days of that change.
(7)Except as provided in subparagraph (B) of paragraph (3), the failure to comply with this section may result in action to revoke or deny a license.
(8)The information required by this section shall be made available to the public upon request, shall be included in the public file of the facility, and by July 1, 2002, shall be included in the departments automated certification licensing administration information management system.
(b)(1)On and after January 1, 1990, no person may acquire a direct or indirect beneficial interest of 5 percent or more in any corporation, partnership, or limited liability company licensed to operate a skilled nursing facility or intermediate care facility, in any parent organizations of a corporation, partnership, or limited liability company licensed to operate a skilled nursing facility or intermediate care facility, in any management company under contract with a licensee of a skilled nursing facility or intermediate care facility, or in any parent organizations of a management company under contract with a licensee of a skilled nursing facility or intermediate care facility, nor may any person become an officer or director of, or general partner in, a corporation, partnership, limited liability company, or management company of this type without the prior written approval of the state department. Each application for departmental approval pursuant to this subdivision shall include the information specified in subdivision (a) as regards regarding the person for whom the application is made.
(2)The state department shall approve or disapprove the application within 30 days after receipt thereof, unless the state department, with just cause, extends the application review period beyond 30 days.
(c)The state department shall deny approval of a license application or of an application for approval under subdivision (b) if a person named in the application, as required by this section, was an officer, director, general partner, or owner of a 5-percent or greater direct or indirect beneficial interest in a licensee or in any parent organizations of a licensee of, or in a management company under contract with a licensee of, a skilled nursing facility, intermediate care facility, community care facility, or residential care facility for the elderly at a time during the seven-year period prior to the application in which that facility committed one or more violations of law or regulatory requirements that resulted in any of the following:
(1)Immediate jeopardy to the health, safety, or welfare of one or more residents.
(2)Suspension or
(1)Issuance of a temporary suspension order or revocation of a facilitys license. license by the department.
(3)Termination of
(2)Involuntary termination of a facilitys Medicare or Medi-Cal certification.
(4)
(3)Appointment of a court-ordered receiver pursuant to Section 1327.
(d)The state department may deny approval of a license application or of an application for approval under subdivision (b) if a person named in the application, as required by this section, was an officer, director, general partner, or owner of a 5-percent or greater beneficial interest in a licensee or in any parent organizations of a licensee of, or in a management company under contract with a licensee of, a skilled nursing facility, intermediate care facility, community care facility, or residential care facility for the elderly at a time during the seven-year period prior to the application in which any of the following occurred:
(1)The department revoked, suspended, or denied a nursing home administrators license held or sought by the person.
(2)The State Department of Social Services revoked, suspended, or denied a residential care facility for the elderly administrators certificate held or sought by the person pursuant to Chapter 3.2 (commencing with Section 1569).
(3)The person prevented or attempted to impede the work of any authorized representative of the department.
(4)The person failed to demonstrate competence in operating a facility.
(5)The person failed to report abuse of residents in accordance with any state or federal requirement.
(6)The facility committed one or more violations of law or regulatory requirements that resulted in any of the following:
(A)Immediate jeopardy to the health, safety, or welfare of one of more residents.
(A)
(B)A settlement agreement to resolve proceedings to suspend, deny, or revoke the license of a facility or to terminate a facilitys Medicare or Medi-Cal certification.
(B)
(C)Appointment of a temporary manager pursuant to Section 1325.5.
(C)
(D)One or more class A or class AA citations pursuant to Section 1424 or 1424.5.
(D)
(E)A court order or judgment granting damages or any form of equitable relief, including an injunction, resulting from an action filed by the Attorney General.
(e)No application shall be denied pursuant to this section until the state department first (1) provides the applicant with notice in writing of grounds for the proposed denial of application, and (2) affords the applicant an opportunity to submit additional documentary evidence in opposition to the proposed denial.
(f)Nothing in this section shall cause any individual to be personally liable for any civil penalty assessed pursuant to Chapter 2.4 (commencing with Section 1417) or create any new criminal or civil liability contrary to general laws limiting that liability.
(g)This section shall not apply to a bank, trust company, financial institution, title insurer, controlled escrow company, or underwritten title company to which a license is issued in a fiduciary capacity.
(h)This section shall not apply to the directors of a nonprofit corporation exempt from taxation under Section 23701d of the Revenue and Taxation Code that operates a skilled nursing facility or intermediate care facility in conjunction with a licensed residential facility, where the directors serve without financial compensation and are not compensated by the nonprofit corporation in any other capacity.
(i)For purposes of this section:
(1)Beneficial interest means the interest held by any person, including a private equity firm and real estate investment trust, that acquires an interest in any entity, including, but not limited to, any firm, association, organization, partnership, business trust, investment trust, corporation, or limited liability company, that is licensed to operate a facility, as defined in subdivision (c) or (d) of Section 1250, by assuming that entitys debt.
(2)Indirect beneficial interest means the interest held by any person, including a private equity firm and real estate investment trust, that provides capital or assets to a facility, as defined in subdivision (c) or (d) of Section 1250, in exchange for a share of 5 percent or more of the facilitys gross income or profits.
(3)Management company means any company or entity that has assumed operational or managerial control over the facility or who directly or indirectly conducts the day-to-day operations of the facility either under contract or through some other arrangement.
(4)Person has the same meaning as specified in Section 19.
SEC. 5.Section 1422.5 of the Health and Safety Code is amended to read:1422.5.(a) The department shall develop and establish a statewide consumer information service system to provide current and accurate information to the general public and consumers regarding long-term care facilities in their communities. The consumer information service system shall include, but need not be limited to, all of the following elements:
(1)An online information system available on the Internet through an accessible Internet Web site. The Internet Web site created pursuant to this paragraph shall be operational and made available to the public by March 1, 2016, 2017, and shall include the information elements specified in paragraph (2).
(2)Long-term health care facility profiles, with data on services provided, a history of all deficiencies, citations, and complaints for the last three full survey cycles, and current ownership information. The online profile for each facility shall include, but not be limited to, all of the following:
(A)The name, address, and telephone number of the facility.
(B)The name of the current administrator, director of nursing, and medical director.
(C)Current and accurate ownership information pursuant to Sections 1265, 1267.5, 1599.64, and 1599.645, including, but not limited to, all of the following:
(i)Whether the facility is a for-profit or not-for-profit provider.
(ii)The name, address, and telephone number of the licensee.
(iii)The name and contact information of a single entity that is responsible for all aspects of patient care and the operation of the facility.
(iv)Whether the facility is part of a multifacility organization and, if so, the name, address, and telephone number of the organization and, if applicable, of any parent organizations.
(v)Whether the facility is operated by a management company and, if so, the name, address, and telephone number of the management company and, if applicable, of any parent organizations of the management company.
(vi)The names and addresses of each person who is an officer or director of the licensee, parent organizations, and management company, if applicable.
(vii)The names and addresses of any person or organization, or both, having an ownership or control interest of 5 percent or more in the licensee, parent organizations, and management company, if applicable.
(viii)The names and addresses of all long-term health care facilities owned, leased, managed, or operated by any person, corporation, management company, parent organization, or other entity described in clauses (ii) to (vii), inclusive.
(ix)The names and addresses of the property owners.
(D)The number of licensed beds in the facility.
(E)Whether the facility accepts Medicare or Medi-Cal patients.
(F)Whether the facility has filed a notice of intent to withdraw from the Medi-Cal program, and the date that the notice of intent to withdraw was filed with the department.
(G)Whether the facility has a special care unit or program for people with Alzheimers disease and other dementias, and whether the facility participates in the voluntary disclosure program for special care units.
(H)Information regarding all complaints, along with any outcome, including, but not limited to, the date of the complaint, the nature of the complaint, the date the complaint was investigated, the action taken, and the date of the action taken.
(I)Information describing all
(I)The text of all state and federal deficiencies issued to the facility, including, but not limited to, the date of the deficiency, the nature of the deficiency, the scope and severity of the deficiency, and a statement that the facilitys plan of correction is available upon request through the departments district offices.
(J)Information describing all
(J)The text of all state citations assessed, including, but not limited to, the date of the citation, the nature of the citation, the class of the citation, the amount of the penalty assessed, and the status of the citation.
(K)Updated information, on a regular and timely basis, regarding any appeal resolution pertaining to a citation or complaint.
(L)Information describing state enforcement actions imposed, including, but not limited to, license suspensions, revocations, and the appointment of temporary managers and receiverships.
(M)Information describing federal enforcement sanctions imposed, including, but not limited to, any denial of payment, temporary management, termination, or any civil monetary penalty imposed. imposed, if available from the federal Centers for Medicare and Medicaid Services.
(N)Information on compliance with staffing ratio requirements.
(O)Any information or data the department deems beneficial to the public and consumers.
(b)It is the intent of the Legislature that the department, in developing and establishing the system pursuant to subdivision (a), maximize the use of available federal funds.
(c)In implementing this section, the department shall ensure the confidentiality of personal and identifying information of residents and employees and shall not disclose this information through the consumer information service system developed pursuant to this section.
(d)The department shall make current written copies of the long-term health care facility profiles available to the public through its district offices.
SEC. 6.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
This act shall be known as the Nursing Home Ownership Disclosure Act of 2015.
SEC. 2.Section 1265 of the Health and Safety Code is amended to read:1265.(a)Any person, political subdivision of the state, or governmental agency desiring a license for a health facility, approval for a special service under this chapter, or approval to manage a health facility currently licensed as a health facility, as defined in subdivision (a), (b), (c), (d), or (f) of Section 1250, that has not filed an application for a license to operate that facility shall file with the department a verified application on forms prescribed and furnished by the department, containing all of the following:
(1)The name of the applicant and, if an individual, whether the applicant has attained the age of 18 years.
(2)The type of facility or health facility.
(3)The location thereof.
(4)The name of the person in charge thereof.
(5)Evidence satisfactory to the department that the applicant is of reputable and responsible character. If the applicant is a firm, association, organization, partnership, business trust, corporation, or company, like evidence shall be submitted as to the members or shareholders thereof, and the person in charge of the health facility for which application for license is made. If the applicant is a political subdivision of the state or other governmental agency, like evidence shall be submitted as to the person in charge of the health facility for which application for license is made.
(6)Evidence satisfactory to the department of the ability of the applicant to comply with this chapter and of rules and regulations promulgated under this chapter by the department.
(7)Evidence satisfactory to the department that the applicant to operate a skilled nursing facility or intermediate care facility possesses financial resources sufficient to operate the facility for a period of at least 45 days. A management company shall not be required to submit this information.
(8)Each applicant for a license to operate a skilled nursing facility or intermediate care facility shall disclose to the department evidence of the right to possession of the facility at the time the application will be granted, which may be satisfied by the submission of a copy of applicable portions of a lease agreement or deed of trust. The names and addresses of any persons or organizations listed as owner of record in the real estate, including the buildings and the grounds appurtenant to the buildings, shall be disclosed to the department.
(9)Any other information as may be required by the department for the proper administration and enforcement of this chapter.
(10)Upon submission of an application to the department by an intermediate care facility/developmentally disabled habilitative or an intermediate care facility/developmentally disabled-nursing, the application shall include a statement of need signed by the chairperson of the area board pursuant to Chapter 4 (commencing with Section 4570) of Division 4.5 of the Welfare and Institutions Code. In the event the area board has not provided the statement of need within 30 days of receipt of the request from the applicant, the department may process the application for license without the statement.
(b)The information required pursuant to this section, other than individuals social security numbers, shall be made available to the public upon request, and shall be included in the departments public file regarding the facility.
(c)With respect to a facility licensed as a health facility, as defined in subdivision (a), (b), (c), (d), or (f) of Section 1250, for purposes of this section, manage means to assume operational control of the facility.
(d)Failure of an applicant to cooperate with the licensing agency in the completion of an application pursuant to this section shall result in the denial of the application. Failure of an applicant to cooperate means that the information required pursuant to this chapter and by regulations of the department has not been provided, or has not been provided in the form requested by the licensing agency, or both.
SEC. 3.Section 1265.3 of the Health and Safety Code is amended to read:1265.3.(a)For any individual or entity that seeks approval to operate or manage a health facility licensed pursuant to subdivision (a), (b), (c), (d), or (f) of Section 1250 and is subject to Section 1265, the department shall consider the following:
(1)To determine whether the applicant is of reputable and responsible character, the department shall consider any available information that the applicant has demonstrated a pattern and practice of violations of state or federal laws and regulations. The department shall give particular consideration to those violations that affect the applicants ability to deliver safe patient or resident care.
(2)To determine whether the applicant has the ability to comply with this chapter and the rules and regulations adopted under this chapter, the department shall consider evidence that shall include all of the following:
(A)If any, prior history of operating in this state any other facility licensed pursuant to Section 1250, and the applicants history of substantial compliance with the requirements imposed under that license, applicable federal laws and regulations, and requirements governing the operators of those facilities.
(B)If any, prior history of operating in any other state any facility authorized to receive Medicare Program reimbursement or Medicaid Program reimbursement, and the applicants history of substantial compliance with that states requirements, and applicable federal laws, regulations, and requirements.
(C)If any, prior history of providing health services as a licensed health professional or an individual or entity contracting with a health care service plan or insurer, and the applicants history of substantial compliance with state requirements, and applicable federal law, laws, regulations, and requirements.
(b)The department may also require the entity described in subdivision (a) to furnish other information or documents for the proper administration and enforcement of the licensing laws.
SEC. 4.Section 1267.5 of the Health and Safety Code is amended to read:1267.5.(a)(1)Each applicant for a license to operate a skilled nursing facility or intermediate care facility shall disclose to the state department the name and business address of each general partner if the applicant is a partnership, or each director and officer if the applicant is a corporation, and each person having a beneficial ownership interest of 5 percent or more in the applicant corporation or partnership.
(2)If any person described in paragraph (1) has served or currently serves as an administrator, general partner, trustee or trust applicant, sole proprietor of any applicant or licensee who is a sole proprietorship, executor, or corporate officer or director of, or has held a direct or indirect beneficial ownership interest of 5 percent or more in, any other skilled nursing facility or intermediate care facility in this state or any other state, in any community care facility licensed pursuant to Chapter 3 (commencing with Section 1500), or in any residential care facility for the elderly licensed pursuant to Chapter 3.2 (commencing with Section 1569), the applicant shall disclose the relationship to the state department, including the name and current or last address of the health facility, community care facility, or residential care facility for the elderly, and the date the relationship commenced and, if applicable, the date it was terminated.
(3)(A)If the facility is operated by, or proposed to be operated in whole or part under, a management contract, the names and addresses of any person or organization, or both, having an ownership or control interest of 5 percent or more in the management company shall be disclosed to the state department. This provision shall not apply if the management company has submitted an application for licensure with the state department and has complied with paragraph (1).
(B)If the management company is a subsidiary of one or more other organizations, the information shall include the names and addresses of the parent organizations of the management company and the names and addresses of any officer or director of the parent organizations. The failure to comply with this subparagraph may result in action to revoke or deny a license. However, once the information that is required under this subparagraph is provided, the action to revoke the license shall terminate.
(C)If the management company or parent organizations of the management company manage or previously managed any other skilled nursing facility or intermediate care facility in this state or any other state, any community care facility licensed pursuant to Chapter 3 (commencing with Section 1500), or any residential care facility for the elderly licensed pursuant to Chapter 3.2 (commencing with Section 1569), the applicant shall disclose the name and current or last address of the health facility, community care facility, or residential care facility for the elderly, and the date the management commenced and, if applicable, the date it was terminated.
(4)(A)If the applicant or licensee is a subsidiary of one or more other organizations, the information shall include the names and addresses of the parent organizations of the subsidiary and the names and addresses of any officer or director of the parent organizations.
(B)If the parent organizations of the subsidiary or applicant own or manage, or previously owned or managed, any other skilled nursing facility or intermediate care facility in this state or any other state, any community care facility licensed pursuant to Chapter 3 (commencing with Section 1500), or any residential care facility for the elderly licensed pursuant to Chapter 3.2 (commencing with Section 1569), the applicant shall disclose the relationship to the state department, including the name and current or last address of the health facility, community care facility, or residential care facility for the elderly, and the date the relationship commenced and, if applicable, the date it was terminated.
(5)The applicant shall disclose the history of compliance and any history of noncompliance with any applicable state or federal law or regulation for each facility described in paragraph (2), subparagraph (C) of paragraph (3), and subparagraph (B) of paragraph (4) during the period in which any of the following apply:
(A)Any person described in paragraph (1) had a relationship to the facility.
(B)Any management company described in paragraph (3) managed the facility.
(C)Any parent organizations described in paragraph (4) had a relationship to the facility.
(6)The information required by this subdivision shall be provided to the state department upon initial application for licensure, and any change in the information shall be provided to the state department within 30 calendar days of that change.
(7)Except as provided in subparagraph (B) of paragraph (3), the failure to comply with this section may result in action to revoke or deny a license.
(8)The information required by this section shall be made available to the public upon request, shall be included in the public file of the facility, and by July 1, 2002, shall be included in the departments automated certification licensing administration information management system.
(b)(1)On and after January 1, 1990, no person may acquire a direct or indirect beneficial interest of 5 percent or more in any corporation, partnership, or limited liability company licensed to operate a skilled nursing facility or intermediate care facility, in any parent organizations of a corporation, partnership, or limited liability company licensed to operate a skilled nursing facility or intermediate care facility, in any management company under contract with a licensee of a skilled nursing facility or intermediate care facility, or in any parent organizations of a management company under contract with a licensee of a skilled nursing facility or intermediate care facility, nor may any person become an officer or director of, or general partner in, a corporation, partnership, limited liability company, or management company of this type without the prior written approval of the state department. Each application for departmental approval pursuant to this subdivision shall include the information specified in subdivision (a) as regards the person for whom the application is made.
(2)The state department shall approve or disapprove the application within 30 days after receipt thereof, unless the state department, with just cause, extends the application review period beyond 30 days.
(c)The state department shall deny approval of a license application or of an application for approval under subdivision (b) if a person named in the application, as required by this section, was an officer, director, general partner, or owner of a 5-percent or greater direct or indirect beneficial interest in a licensee or in any parent organizations of a licensee of, or in a management company under contract with a licensee of, a skilled nursing facility, intermediate care facility, community care facility, or residential care facility for the elderly at a time during the seven-year period prior to the application in which that facility committed one or more violations of law or regulatory requirements that resulted in any of the following:
(1)Immediate jeopardy to the health, safety, or welfare of one or more residents.
(2)Suspension or revocation of a facilitys license.
(3)Termination of a facilitys Medicare or Medi-Cal certification.
(4)Appointment of a court-ordered receiver pursuant to Section 1327.
(d)The state department may deny approval of a license application or of an application for approval under subdivision (b) if a person named in the application, as required by this section, was an officer, director, general partner, or owner of a 5-percent or greater beneficial interest in a licensee or in any parent organizations of a licensee of, or in a management company under contract with a licensee of, a skilled nursing facility, intermediate care facility, community care facility, or residential care facility for the elderly at a time during the seven-year period prior to the application in which any of the following occurred:
(1)The department revoked, suspended, or denied a nursing home administrators license held or sought by the person.
(2)The State Department of Social Services revoked, suspended, or denied a residential care facility for the elderly administrators certificate held or sought by the person pursuant to Chapter 3.2 (commencing with Section 1569).
(3)The person prevented or attempted to impede the work of any authorized representative of the department.
(4)The person failed to demonstrate competence in operating a facility.
(5)The person failed to report abuse of residents in accordance with any state or federal requirement.
(6)The facility committed one or more violations of law or regulatory requirements that resulted in any of the following:
(A)A settlement agreement to resolve proceedings to suspend, deny, or revoke the license of a facility or to terminate a facilitys Medicare or Medi-Cal certification.
(B)Appointment of a temporary manager pursuant to Section 1325.5.
(C)One or more class A or class AA citations pursuant to Section 1424 or 1424.5.
(D)A court order or judgment granting damages or any form of equitable relief, including an injunction, resulting from an action filed by the Attorney General.
(e)No application shall be denied pursuant to this section until the state department first (1) provides the applicant with notice in writing of grounds for the proposed denial of application, and (2) affords the applicant an opportunity to submit additional documentary evidence in opposition to the proposed denial.
(f)Nothing in this section shall cause any individual to be personally liable for any civil penalty assessed pursuant to Chapter 2.4 (commencing with Section 1417) or create any new criminal or civil liability contrary to general laws limiting that liability.
(g)This section shall not apply to a bank, trust company, financial institution, title insurer, controlled escrow company, or underwritten title company to which a license is issued in a fiduciary capacity.
(h)This section shall not apply to the directors of a nonprofit corporation exempt from taxation under Section 23701d of the Revenue and Taxation Code that operates a skilled nursing facility or intermediate care facility in conjunction with a licensed residential facility, where the directors serve without financial compensation and are not compensated by the nonprofit corporation in any other capacity.
(i)For purposes of this section:
(1)Beneficial interest means the interest held by any person, including a private equity firm and real estate investment trust, that acquires an interest in any entity, including, but not limited to, any firm, association, organization, partnership, business trust, investment trust, corporation, or limited liability corporation, company, that is licensed to operate a facility, as defined in subdivision (c) or (d) of Section 1250, by assuming that entitys debt.
(2)Indirect beneficial interest means the internet interest held by any person, including a private equity firm and real estate investment trust, that provides capital or assets to a facility, as defined in subdivision (c) or (d) of Section 1250, in exchange for a share of 5 percent or more of the facilitys gross income or profits.
(3)Management company means any company or entity that has assumed operational or managerial control over the facility or who directly or indirectly conducts the day-to-day operations of the facility either under contract or through some other arrangement.
(4)Person has the same meaning as specified in Section 19.
SEC. 5.Section 1422.5 of the Health and Safety Code is amended to read:1422.5.(a) The department shall develop and establish a statewide consumer information service system to provide current and accurate information to the general public and consumers regarding long-term care facilities in their communities. The consumer information service system shall include, but need not be limited to, all of the following elements:
(1)An online information system available on the Internet through an accessible Internet Web site. The Internet Web site created pursuant to this paragraph shall be operational and made available to the public by March 1, 2016, and shall include the information elements specified in paragraph (2).
(2)Long-term health care facility profiles, with data on services provided, a history of all deficiencies, citations, and complaints for the last three full survey cycles, and current ownership information. The profile for each facility shall include, but not be limited to, all of the following:
(A)The name, address, and telephone number of the facility.
(B)The name of the current administrator, director of nursing, and medical director.
(C)Current and accurate ownership information pursuant to Sections 1265, 1267.5, 1599.64, and 1599.645, including, but not limited to, all of the following:
(i)Whether the facility is a for-profit or not-for-profit provider.
(ii)The name, address, and telephone number of the licensee.
(iii)The name and contact information of a single entity that is responsible for all aspects of patient care and the operation of the facility.
(iv)Whether the facility is part of a multifacility organization and, if so, the name, address, and telephone number of the organization and, if applicable, of any parent organizations.
(v)Whether the facility is operated by a management company and, if so, the name, address, and telephone number of the management company and, if applicable, of any parent organizations of the management company.
(vi)The names and addresses of each person who is an officer or director of the licensee, parent organizations, and management company, if applicable.
(vii)The names and addresses of any person or organization, or both, having an ownership or control interest of 5 percent or more in the licensee, parent organizations, and management company, if applicable.
(viii)The names and addresses of all long-term health care facilities owned, leased, managed, or operated by any person, corporation, management company, parent organization, or other entity described in clauses (ii) to (vii), inclusive.
(ix)The names and addresses of the property owners.
(D)The number of licensed beds in the facility.
(E)Whether the facility accepts Medicare or Medi-Cal patients.
(F)Whether the facility has filed a notice of intent to withdraw from the Medi-Cal program, and the date that the notice of intent to withdraw was filed with the department.
(G)Whether the facility has a special care unit or program for people with Alzheimers disease and other dementias, and whether the facility participates in the voluntary disclosure program for special care units.
(H)Information regarding all complaints, along with any outcome, including, but not limited to, the date of the complaint, the nature of the complaint, the date the complaint was investigated, the action taken, and the date of the action taken.
(I)Information describing all state and federal deficiencies issued to the facility, including, but not limited to, the date of the deficiency, the nature of the deficiency, the scope and severity of the deficiency, and a statement that the facilitys plan of correction is available upon request through the departments district offices.
(J)Information describing all state citations assessed, including, but not limited to, the date of the citation, the nature of the citation, the class of the citation, the amount of the penalty assessed, and the status of the citation.
(K)Updated information, on a regular and timely basis, regarding any appeal resolution pertaining to a citation or complaint.
(L)Information describing state enforcement actions imposed, including, but not limited to, license suspensions, revocations, and the appointment of temporary managers and receiverships.
(M)Information describing federal enforcement sanctions imposed, including, but not limited to, any denial of payment, temporary management, termination, or any civil monetary penalty imposed.
(N)Information on compliance with staffing ratio requirements.
(O)Any information or data the department deems beneficial to the public and consumers.
(b)It is the intent of the Legislature that the department, in developing and establishing the system pursuant to subdivision (a), maximize the use of available federal funds.
(c)In implementing this section, the department shall ensure the confidentiality of personal and identifying information of residents and employees and shall not disclose this information through the consumer information service system developed pursuant to this section.
(d)The department shall make current written copies of the long-term health care facility profiles available to the public through its district offices.
SEC. 6.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
This act shall be known as the Nursing Home Ownership Disclosure Act of 2015.
SEC. 2.Section 1265 of the Health and Safety Code is amended to read:1265.(a)Any person, political subdivision of the state, or governmental agency desiring a license for a health facility, approval for a special service under this chapter, or approval to manage a health facility currently licensed as a health facility, as defined in subdivision (a), (b), (c), (d), or (f) of Section 1250, that has not filed an application for a license to operate that facility shall file with the department a verified application on forms prescribed and furnished by the department, containing all of the following:
(a)
(1)The name of the applicant and, if an individual, whether the applicant has attained the age of 18 years.
(b)
(2)The type of facility or health facility.
(c)
(3)The location thereof.
(d)
(4)The name of the person in charge thereof.
(e)
(5)Evidence satisfactory to the department that the applicant is of reputable and responsible character. If the applicant is a firm, association, organization, partnership, business trust, corporation, or company, like evidence shall be submitted as to the members or shareholders thereof, and the person in charge of the health facility for which application for license is made. If the applicant is a political subdivision of the state or other governmental agency, like evidence shall be submitted as to the person in charge of the health facility for which application for license is made.
(f)
(6)Evidence satisfactory to the department of the ability of the applicant to comply with this chapter and of rules and regulations promulgated under this chapter by the department.
(g)
(7)Evidence satisfactory to the department that the applicant to operate a skilled nursing facility or intermediate care facility possesses financial resources sufficient to operate the facility for a period of at least 45 days. A management company shall not be required to submit this information.
(h)
(8)Each applicant for a license to operate a skilled nursing facility or intermediate care facility shall disclose to the department evidence of the right to possession of the facility at the time the application will be granted, which may be satisfied by the submission of a copy of applicable portions of a lease agreement or deed of trust. The names and addresses of any persons or organizations listed as owner of record in the real estate, including the buildings and the grounds appurtenant to the buildings, shall be disclosed to the department.
(i)
(9)Any other information as may be required by the department for the proper administration and enforcement of this chapter.
(j)
(10)Upon submission of an application to the department by an intermediate care facility/developmentally disabled habilitative or an intermediate care facility/developmentally disabled-nursing, the application shall include a statement of need signed by the chairperson of the area board pursuant to Chapter 4 (commencing with Section 4570) of Division 4.5 of the Welfare and Institutions Code. In the event the area board has not provided the statement of need within 30 days of receipt of the request from the applicant, the department may process the application for license without the statement.
(k)
(b)The information required pursuant to this section, other than individuals social security numbers, shall be made available to the public upon request, and shall be included in the departments public file regarding the facility.
(l)
(c)With respect to a facility licensed as a health facility, as defined in subdivision (a), (b), (c), (d), or (f) of Section 1250, for purposes of this section, manage means to assume operational control of the facility.
(d)Failure of an applicant to cooperate with the licensing agency in the completion of an application pursuant to this section shall result in the denial of the application. Failure of an applicant to cooperate means that the information required pursuant to this chapter and by regulations of the department has not been provided, or has not been provided in the form requested by the licensing agency, or both.
SEC. 3.Section 1265.3 of the Health and Safety Code is amended to read:1265.3.(a)For any individual or entity that seeks approval to operate or manage a health facility licensed pursuant to subdivision (a), (b), (c), (d), or (f) of Section 1250 and is subject to Section 1265, the department shall consider the following:
(1)To determine whether the applicant is of reputable and responsible character, the department shall consider any available information that the applicant has demonstrated a pattern and practice of violations of state or federal laws and regulations. The department shall give particular consideration to those violations that affect the applicants ability to deliver safe patient or resident care.
(2)To determine whether the applicant has the ability to comply with this chapter and the rules and regulations adopted under this chapter, the department shall consider evidence that shall include all of the following:
(A)If any, prior history of operating in this state any other facility licensed pursuant to Section 1250, and the applicants history of substantial compliance with the requirements imposed under that license, applicable federal laws and regulations, and requirements governing the operators of those facilities.
(B)If any, prior history of operating in any other state any facility authorized to receive Medicare Program reimbursement or Medicaid Program reimbursement, and the applicants history of substantial compliance with that states requirements, and applicable federal laws, regulations, and requirements.
(C)If any, prior history of providing health services as a licensed health professional or an individual or entity contracting with a health care service plan or insurer, and the applicants history of substantial compliance with state requirements, and applicable federal law, regulations, and requirements.
(b)The department may also require the entity described in subdivision (a) to furnish other information or documents for the proper administration and enforcement of the licensing laws.
SEC. 4.Section 1267.5 of the Health and Safety Code is amended to read:1267.5.(a)(1)Each applicant for a license to operate a skilled nursing facility or intermediate care facility shall disclose to the state department the name and business address of each general partner if the applicant is a partnership, or each director and officer if the applicant is a corporation, and each person having a beneficial ownership interest of 5 percent or more in the applicant corporation or partnership.
(2)If any person described in paragraph (1) has served or currently serves as an administrator, general partner, trustee or trust applicant, sole proprietor of any applicant or licensee who is a sole proprietorship, executor, or corporate officer or director of, or has held a direct or indirect beneficial ownership interest of 5 percent or more in, any other skilled nursing facility or intermediate care facility or in this state or any other state, in any community care facility licensed pursuant to Chapter 3 (commencing with Section 1500) of this division, or in any residential care facility for the elderly licensed pursuant to Chapter 3.2 (commencing with Section 1569), the applicant shall disclose the relationship to the state department, including the name and current or last address of the health facility or, community care facility, or residential care facility for the elderly, and the date the relationship commenced and, if applicable, the date it was terminated.
(3)(A)If the facility is operated by, or proposed to be operated in whole or part under, a management contract, the names and addresses of any person or organization, or both, having an ownership or control interest of 5 percent or more in the management company shall be disclosed to the state department. This provision shall not apply if the management company has submitted an application for licensure with the state department and has complied with paragraph (1).
(B)If the management company is a subsidiary of one or more other organizations, the information shall include the names and addresses of the parent organizations of the management company and the names and addresses of any officer or director of the parent organizations. The failure to comply with this subparagraph may result in action to revoke or deny a license. However, once the information that is required under this subparagraph is provided, the action to revoke the license shall terminate.
(C)If the management company or parent organizations of the management company manage or previously managed any other skilled nursing facility or intermediate care facility in this state or any other state, any community care facility licensed pursuant to Chapter 3 (commencing with Section 1500), or any residential care facility for the elderly licensed pursuant to Chapter 3.2 (commencing with Section 1569), the applicant shall disclose the name and current or last address of the health facility, community care facility, or residential care facility for the elderly, and the date the management commenced and, if applicable, the date it was terminated.
(4)(A)If the applicant or licensee is a subsidiary of one or more other organizations, the information shall include the names and addresses of the parent organizations of the subsidiary and the names and addresses of any officer or director of the parent organizations.
(B)If the parent organizations of the subsidiary or applicant own or manage, or previously owned or managed, any other skilled nursing facility or intermediate care facility in this state or any other state, any community care facility licensed pursuant to Chapter 3 (commencing with Section 1500), or any residential care facility for the elderly licensed pursuant to Chapter 3.2 (commencing with Section 1569), the applicant shall disclose the relationship to the state department, including the name and current or last address of the health facility, community care facility, or residential care facility for the elderly, and the date the relationship commenced and, if applicable, the date it was terminated.
(5)The applicant shall disclose the history of compliance and any history of noncompliance with any applicable state or federal law or regulation for each facility described in paragraph (2), subparagraph (C) of paragraph (3), and subparagraph (B) of paragraph (4) during the period in which any of the following apply:
(A)Any person described in paragraph (1) had a relationship to the facility.
(B)Any management company described in paragraph (3) managed the facility.
(C)Any parent organizations described in paragraph (4) had a relationship to the facility.
(5)
(6)The information required by this subdivision shall be provided to the state department upon initial application for licensure, and any change in the information shall be provided to the state department within 30 calendar days of that change.
(6)
(7)Except as provided in subparagraph (B) of paragraph (3), the failure to comply with this section may result in action to revoke or deny a license.
(7)
(8)The information required by this section shall be made available to the public upon request, shall be included in the public file of the facility, and by July 1, 2002, shall be included in the departments automated certification licensing administration information management system.
(b)(1)On and after January 1, 1990, no person may acquire a direct or indirect beneficial interest of 5 percent or more in any corporation or, partnership, or limited liability company licensed to operate a skilled nursing facility or intermediate care facility, or in any parent organizations of a corporation, partnership, or limited liability company licensed to operate a skilled nursing facility or intermediate care facility, in any management company under contract with a licensee of a skilled nursing facility or intermediate care facility, or in any parent organizations of a management company under contract with a licensee of a skilled nursing facility or intermediate care facility, nor may any person become an officer or director of, or general partner in, a corporation, partnership, limited liability company, or management company of this type without the prior written approval of the state department. Each application for departmental approval pursuant to this subdivision shall include the information specified in subdivision (a) as regards the person for whom the application is made.
The
(2)The state department shall approve or disapprove the application within 30 days after receipt thereof, unless the state department, with just cause, extends the application review period beyond 30 days.
(c) The state department may deny approval of a license application or of an application for approval under subdivision (b) if a person named in the application, as required by this section, was an officer, director, general partner, or owner of a 5-percent or greater beneficial interest in a licensee of, or in a management company under contract with a licensee of, a skilled nursing facility, intermediate care facility, community care facility, or residential care facility for the elderly at a time when one or more violations of law were committed therein that resulted in suspension or revocation of its license, or at a time when a court-ordered receiver was appointed pursuant to Section 1327, or at a time when a final Medi-Cal decertification action was taken under federal law. However, the prior suspension, revocation, or court-ordered receivership of a license shall not be grounds for denial of the application if the applicant shows to the satisfaction of the state department (1) that the person in question took every reasonably available action to prevent the violation or violations that resulted in the disciplinary action and (2) that he or she took every reasonably available action to correct the violation or violations once he or she knew, or with the exercise of reasonable diligence should have known of, the violation or violations.
(c)The state department shall deny approval of a license application or of an application for approval under subdivision (b) if a person named in the application, as required by this section, was an officer, director, general partner, or owner of a 5-percent or greater direct or indirect beneficial interest in a licensee or in any parent organizations of a licensee of, or in a management company under contract with a licensee of, a skilled nursing facility, intermediate care facility, community care facility, or residential care facility for the elderly at a time during the seven-year period prior to the application in which that facility committed one or more violations of law or regulatory requirements that resulted in any of the following:
(1)Immediate jeopardy to the health, safety, or welfare of one or more residents.
(2)Suspension or revocation of a facilitys license.
(3)Termination of a facilitys Medicare or Medi-Cal certification.
(4)Appointment of a court-ordered receiver pursuant to Section 1327.
(d)The state department may deny approval of a license application or of an application for approval under subdivision (b) if a person named in the application, as required by this section, was an officer, director, general partner, or owner of a 5-percent or greater beneficial interest in a licensee or in any parent organizations of a licensee of, or in a management company under contract with a licensee of, a skilled nursing facility, intermediate care facility, community care facility, or residential care facility for the elderly at a time during the seven-year period prior to the application in which any of the following occurred:
(1)The department revoked, suspended, or denied a nursing home administrators license held or sought by the person.
(2)The State Department of Social Services revoked, suspended, or denied a residential care facility for the elderly administrators certificate held or sought by the person pursuant to Chapter 3.2 (commencing with Section 1569).
(3)The person prevented or attempted to impede the work of any authorized representative of the department.
(4)The person failed to demonstrate competence in operating a facility.
(5)The person failed to report abuse of residents in accordance with any state or federal requirement.
(6)The facility committed one or more violations of law or regulatory requirements that resulted in any of the following:
(A)A settlement agreement to resolve proceedings to suspend, deny, or revoke the license of a facility or to terminate a facilitys Medicare or Medi-Cal certification.
(B)Appointment of a temporary manager pursuant to Section 1325.5.
(C)One or more class A or class AA citations pursuant to Section 1424 or 1424.5.
(D)A court order or judgment granting damages or any form of equitable relief, including an injunction, resulting from an action filed by the Attorney General.
(d)
(e)No application shall be denied pursuant to this section until the state department first (1) provides the applicant with notice in writing of grounds for the proposed denial of application, and (2) affords the applicant an opportunity to submit additional documentary evidence in opposition to the proposed denial.
(e)
(f)Nothing in this section shall cause any individual to be personally liable for any civil penalty assessed pursuant to Chapter 2.4 (commencing with Section 1417) or create any new criminal or civil liability contrary to general laws limiting that liability.
(f)
(g)This section shall not apply to a bank, trust company, financial institution, title insurer, controlled escrow company, or underwritten title company to which a license is issued in a fiduciary capacity.
(g)As used in this section, person has the same meaning as specified in Section 19.
(h)This section shall not apply to the directors of a nonprofit corporation exempt from taxation under Section 23701d of the Revenue and Taxation Code that operates a skilled nursing facility or intermediate care facility in conjunction with a licensed residential facility, where the directors serve without financial compensation and are not compensated by the nonprofit corporation in any other capacity.
(i)For purposes of this section:
(1)Beneficial interest means the interest held by any person, including a private equity firm and real estate investment trust, that acquires an interest in any entity, including, but not limited to, any firm, association, organization, partnership, business trust, investment trust, corporation, or limited liability corporation, that is licensed to operate a facility, as defined in subdivision (c) or (d) of Section 1250, by assuming that entitys debt.
(2)Indirect beneficial interest means the internet held by any person, including a private equity firm and real estate investment trust, that provides capital or assets to a facility, as defined in subdivision (c) or (d) of Section 1250, in exchange for a share of 5 percent or more of the facilitys gross income or profits.
(3)Management company means any company or entity that has assumed operational or managerial control over the facility or who directly or indirectly conducts the day-to-day operations of the facility either under contract or through some other arrangement.
(4)Person has the same meaning as specified in Section 19.
SEC. 5.Section 1422.5 of the Health and Safety Code is amended to read:1422.5.(a) The department shall develop and establish a statewide consumer information service system to provide updated current and accurate information to the general public and consumers regarding long-term care facilities in their communities. The consumer information service system shall include, but need not be limited to, all of the following elements:
(1)An on-line inquiry system accessible through a statewide toll-free telephone number and the Internet.
(1)An online information system available on the Internet through an accessible Internet Web site. The Internet Web site created pursuant to this paragraph shall be operational and made available to the public by March 1, 2016, and shall include the information elements specified in paragraph (2).
(2)Long-term health care facility profiles, with data on services provided, a history of all deficiencies, citations and, and complaints for the last two three full survey cycles, and current ownership information. The profile for each facility shall include, but not be limited to, all of the following:
(A)The name, address, and telephone number of the facility.
(B)The number of units or beds in the facility.
(C)Whether the facility accepts Medicare or Medi-Cal patients.
(D)Whether the facility has a special care unit or program for people with Alzheimers disease and other dementias, and whether the facility participates in the voluntary disclosure program for special care units.
(E)Whether the facility is a for-profit or not-for-profit provider.
(3)Information regarding substantiated complaints shall include the action taken and the date of action.
(4)Information regarding the state citations assessed shall include the status of the state citation, including the facilitys plan or correction, and information as to whether an appeal has been filed.
(5)Any appeal resolution pertaining to a citation or complaint shall be updated on the file in a timely manner.
(b)Where feasible, the department shall interface the consumer information service system with its Automated Certification and Licensure Information Management System.
(c)It is the intent of the Legislature that the department, in developing and establishing the system pursuant to subdivision (a), maximize the use of available federal funds.
(d)(1)Notwithstanding the consumer information service system established pursuant to subdivision (a), by January 1, 2002, the state department shall develop a method whereby information is provided to the public and consumers on long-term health care facilities. The information provided shall include, but not be limited to, all of the following elements:
(A)Substantiated complaints, including the action taken and the date of the action.
(B)State citations assessed, including the status of any citation and whether an appeal has been filed.
(C)State actions, including license suspensions, revocations, and receiverships.
(D)Federal enforcement sanctions imposed, including any denial of payment, temporary management, termination, or civil money penalty of five hundred dollars ($500) or more.
(E)Any information or data beneficial to the public and consumers.
(2)This subdivision shall become inoperative on July 1, 2003.
(B)The name of the current administrator, director of nursing, and medical director.
(C)Current and accurate ownership information pursuant to Sections 1265, 1267.5, 1599.64, and 1599.645, including, but not limited to, all of the following:
(i)Whether the facility is a for-profit or not-for-profit provider.
(ii)The name, address, and telephone number of the licensee.
(iii)The name and contact information of a single entity that is responsible for all aspects of patient care and the operation of the facility.
(iv)Whether the facility is part of a multifacility organization and, if so, the name, address, and telephone number of the organization and, if applicable, of any parent organizations.
(v)Whether the facility is operated by a management company and, if so, the name, address, and telephone number of the management company and, if applicable, of any parent organizations of the management company.
(vi)The names and addresses of each person who is an officer or director of the licensee, parent organizations, and management company, if applicable.
(vii)The names and addresses of any person or organization, or both, having an ownership or control interest of 5 percent or more in the licensee, parent organizations, and management company, if applicable.
(viii)The names and addresses of all long-term health care facilities owned, leased, managed, or operated by any person, corporation, management company, parent organization, or other entity described in clauses (ii) to (vii), inclusive.
(ix)The names and addresses of the property owners.
(D)The number of licensed beds in the facility.
(E)Whether the facility accepts Medicare or Medi-Cal patients.
(F)Whether the facility has filed a notice of intent to withdraw from the Medi-Cal program, and the date that the notice of intent to withdraw was filed with the department.
(G)Whether the facility has a special care unit or program for people with Alzheimers disease and other dementias, and whether the facility participates in the voluntary disclosure program for special care units.
(H)Information regarding all complaints, along with any outcome, including, but not limited to, the date of the complaint, the nature of the complaint, the date the complaint was investigated, the action taken, and the date of the action taken.
(I)Information describing all state and federal deficiencies issued to the facility, including, but not limited to, the date of the deficiency, the nature of the deficiency, the scope and severity of the deficiency, and a statement that the facilitys plan of correction is available upon request through the departments district offices.
(J)Information describing all state citations assessed, including, but not limited to, the date of the citation, the nature of the citation, the class of the citation, the amount of the penalty assessed, and the status of the citation.
(K)Updated information, on a regular and timely basis, regarding any appeal resolution pertaining to a citation or complaint.
(L)Information describing state enforcement actions imposed, including, but not limited to, license suspensions, revocations, and the appointment of temporary managers and receiverships.
(M)Information describing federal enforcement sanctions imposed, including, but not limited to, any denial of payment, temporary management, termination, or any civil monetary penalty imposed.
(N)Information on compliance with staffing ratio requirements.
(O)Any information or data the department deems beneficial to the public and consumers.
(b)It is the intent of the Legislature that the department, in developing and establishing the system pursuant to subdivision (a), maximize the use of available federal funds.
(e)
(c)In implementing this section, the department shall ensure the confidentiality of personal and identifying information of residents and employees and shall not disclose this information through the consumer information service system developed pursuant to this section.
(d)The department shall make current written copies of the long-term health care facility profiles available to the public through its district offices.
SEC. 6.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
|
Date
|
Status
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|---|---|
| Feb 26, 2015 | Read first time. To print. |
| Feb 27, 2015 | From printer. May be heard in committee March 29. |
| Mar 16, 2015 | Referred to Com. on HEALTH. |
| Apr 6, 2015 | From committee chair, with author's amendments: Amend, and re-refer to Com. on HEALTH. Read second time and amended. |
| Apr 7, 2015 | In committee: Set, first hearing. Hearing canceled at the request of author. |
| Apr 7, 2015 | Re-referred to Com. on HEALTH. |
| Apr 14, 2015 | In committee: Hearing postponed by committee. |
| Jan 4, 2016 | From committee chair, with author's amendments: Amend, and re-refer to Com. on HEALTH. Read second time and amended. |
| Jan 4, 2016 | Re-referred to Com. on HEALTH. |
| Jan 12, 2016 | In committee: Set, second hearing. Hearing canceled at the request of author. |
| Jan 31, 2016 | Died pursuant to Article IV, Sec. 10(c) of the Constitution. |
| Feb 1, 2016 | From committee: Filed with the Chief Clerk pursuant to Joint Rule 56. |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
Date of Hearing: January 12, 2016
ASSEMBLY COMMITTEE ON HEALTH
Rob Bonta, Chair
ABPCA Bill Id:AB 927
Author:McCarty – As Amended Ver:January 4, 2016
SUBJECT: Health facilities: nursing homes.
SUMMARY: Establishes the Nursing Home Ownership Disclosure Act of 2016 within the Department of Public Health (DPH). Imposes additional transparency and suitability requirements for ownership and licensure of skilled nursing facilities (SNFs) and intermediate care facilities (ICFs). Expands disclosure requirements applicants for ownership or governance of ICFs and SNFs must provide to DPH. Specifically, this bill:
- Requires DPH to deny the application of any ICF and SNF applicant who fails to cooperate with DPH in the completion of an application for licensure of a specified health facility. Defines “failure of an applicant to cooperate” as the inability of the applicant to provide the information required by existing law and DPH regulations, the inability to provide the information in the form requested by DPH, or both.
- Expands the requirements DPH must investigate to determine if an applicant has demonstrated a pattern and practice of violations of state or federal laws and regulations, and if the applicant has the ability to comply with existing law, to all applicants for licensure of SNFs and ICFs.
- Requires DPH to confirm an applicant is in good standing with the appropriate licensing agency and obtain historical information on any disciplinary action taken against an applicant, if the applicant is a professional licensed by the State of California.
- Requires applicants for licensure of SNFs and ICFs to disclose additional information to DPH including the following:
- Information regarding applicants who have held a direct or indirect beneficial ownership interest of 5% or more in any other SNF or ICF in California or any other state, or in any residential care facility (RCF);
- Existing relationships of an applicant’s parent organizations, subsidiaries, management or parent organizations of management companies with any other SNFs or ICFs within the United States, any community care facility (CCF), or any RCF; and,
- History of compliance or noncompliance with applicable state and federal laws or regulations, as specified.
- Information regarding applicants who have held a direct or indirect beneficial ownership interest of 5% or more in any other SNF or ICF in California or any other state, or in any residential care facility (RCF);
- Clarifies that a person, as defined, is prohibited from acquiring a direct or indirect beneficial interest of 5% or more in specified business structures without prior written approval from DPH.
- Requires DPH to deny approval of a license application for individuals who maintain 5% or greater direct or indirect beneficial interest in licensees, as defined, of a SNF, ICF, CCF, or RCF for the elderly at a time during the seven-year period prior to the application in which that facility committed one or more of the following violations:
- Issuance of a temporary suspension or revocation of a facility’s license by DPH;
- Involuntary termination of a facility’s Medicare or Medi-Cal certification; or,
- Appointment of a court-ordered receiver.
- Issuance of a temporary suspension or revocation of a facility’s license by DPH;
- Deletes existing criteria for DPH’s authorization to deny approval of a license application of a SNF or ICF, and establishes new conditions for denial for specified persons, if those actions have occurred within the seven-year period prior to the application.
- Requires DPH to provide additional information on long-term care (LTC) facilities through the consumer information service system (CISS).
- Requires DPH to make current written copies of the LTC facility profiles available to the public through its district offices.
- Defines the following:
- “Beneficial interest” means the interest held by any person, including a private equity firm and real estate investment trust, that acquires an interest in any entity, including, but not limited to, any firm, association, organization, partnership, business trust, investment trust, corporation, or limited liability company, that is licensed to operate a SNF or ICF by assuming that entity’s debt;
- “Indirect beneficial interest” means the interest held by any person, including a private equity firm and real estate investment trust that provides capital or assets to a SNF or ICF, in exchange for a share of 5% or more of the facility’s gross income or profits; and,
- “Management company” means any company or entity that has assumed operational or managerial control over the facility or who directly or indirectly conducts the day-to-day operations of the facility either under contract or through some other arrangement.
- “Beneficial interest” means the interest held by any person, including a private equity firm and real estate investment trust, that acquires an interest in any entity, including, but not limited to, any firm, association, organization, partnership, business trust, investment trust, corporation, or limited liability company, that is licensed to operate a SNF or ICF by assuming that entity’s debt;
EXISTING LAW:
- Requires an applicant for licensure or management of a health facility, including specified hospitals, SNFs, or ICFs, that has not filed an application for license to operate that facility to file an application with DPH with specified information regarding the applicant and the health facility in which the applicant seeks licensure or approval of management.
- Requires DPH to consider any available information, as specified, regarding whether or not an applicant has demonstrated a pattern and practice of violations of state or federal laws and regulations, and whether the applicant has the ability to comply with existing law, when considering if an applicant is qualified for licensure of a general acute care hospital, an acute psychiatric hospital, or a special hospital.
- Authorizes DPH to require an applicant for licensure of a general acute care hospital, an acute psychiatric hospital, or a special hospital to provide any documentation or information DPH deems necessary for the proper administration and enforcement of existing laws regarding licensure.
- Requires each applicant seeking licensure to operate a SNF or ICF to disclose to DPH information regarding ownership, management, and governance of other SNFs, ICFs, or CCFs, as specified.
- On and after January 1, 1990, prohibits a person, as defined, from acquiring a beneficial interest of 5% or more in any corporation or partnership licensed to operate a SNF or ICF, or in any management company under contract with a licensee of a SNF or ICF, without prior written approval of DPH.
- Authorizes DPH to deny the license application of a person, as defined, with a beneficial interest of 5% or more in a licensee of, or in a management company under contract with a licensee of, a SNF, ICF, CCF, or RCF for the elderly for any of the following reasons, unless otherwise specified:
- Its license was suspended or revoked due to violations of existing law;
- A court-ordered receiver was appointed; or,
- A final Medi-Cal decertification action was taken by the federal Centers for Medicare and Medicaid Services (CMS);
- Its license was suspended or revoked due to violations of existing law;
- Prohibits DPH from denying an application for licensure of a SNF or ICF without first providing the applicant with a written notice of grounds for the proposed denial of application, and an opportunity to submit additional evidence in opposition to the proposed denial.
- Exempts banks, trust companies, financial institutions, title insurers, controlled escrow companies, underwritten title companies to which a license is issued in a fiduciary capacity, and the directors of specified nonprofit corporations from specified disclosure requirements and denial criteria when applying for licensure of a SNF or ICF.
- Requires DPH to develop and establish a CISS to provide updated and accurate information to the general public and consumers regarding LTC facilities in their communities.
- Requires DPH to interface the CISS with its Automated Certification and Licensure Information Management System, wherever feasible.
- Declares the intent of the Legislature that DPH, in the establishment and development of the CISS, to maximize the use of available federal funds.
- Requires DPH to ensure the confidentiality of personal and identifying information of residents and employees and prohibits the disclosure of such information through the CISS.
FISCAL EFFECT: This bill has not yet been analyzed by a fiscal committee.
COMMENTS:
- PURPOSE OF THIS BILL. According to the author, as owners of LTC facilities use increasingly complex forms of ownership, it has become virtually impossible to determine if the owner of one particular home has significant complaints against them at a different facility, despite many efforts to highlight the problem and uncover the information. The author asserts it is incumbent upon the Legislature to ensure the protection of California's seniors, who are often in their most fragile and vulnerable state in nursing home settings. The author contends it is in the best interest of the state to protect consumers and prevent existing owners with poor track records from opening new LTC facilities, and that there is currently a lack of transparency from DPH. The author concludes this bill will help establish additional oversight and transparency for nursing home ownership by strengthening suitability requirements of owners, clarifying DPH's duty to review and approve ownership changes, and make ownership information more transparent to the public.
- BACKGROUND. According to the Department of Finance, the fasting growing cohort in California’s population is 65 to 74-year olds due to baby boomers reaching that milestone. This group is expected to grow by 25% by 2019. With this rapid growth rate and a quickly changing healthcare and social services system, the regulatory challenges for the state are anticipated to grow in complexity.
- DPH’s Licensing and Certification (L&C) Program. DPH’s L&C Program is the DPH’s largest program and is responsible for the regulatory oversight of over 7,500 licensed health care facilities, 2,500 of which are LTC facilities such as SNFs and ICFs. Additionally, the federal CMS contracts with L&C to evaluate facilities accepting payments from Medicare and Medi-Cal, the state’s Medicaid program, to ensure that they meet federal requirements. The L&C Program evaluates health care facilities for compliance with state and federal laws and regulations through a variety of required tasks, including initial and re-licensure surveys, federal certification surveys, and investigations of complaints and entity-reported incidents (ERIs).
- SNF and ICF Licenses and Ownership. According to the Office of Statewide Health Planning and Development, most SNF and ICF facilities are run as for-profit enterprises; about 13% are not-for-profit. According to DPH, there is an average of 34 individuals associated with SNF licensing application, including owners, board members, the director of nursing, and the administrator. As of May 2015, DPH stated that since 2008, one SNF or ICF license has been suspended, 61 decertification actions have been taken, and six certification termination acts were initiated where the facility was able to return to compliance. Between July 1, 2007 and March 15, 2015, a total of 549 ICF or SNF facilities have been issued at least one Class AA or A citation. A class AA citation is a violation that DPH has determined to have been a direct proximate cause of death of a patient or resident of a LTC facility. A class A citation is a violation that DPH has determined presents either imminent danger that death or serious harm to the patients or residents, or that there is substantial probability that death or serious physical harm to patients or residents.
- Nursing Homes in the Media. In the summer of 2013, The Sacramento Bee published a three-part series of articles entitled “Nursing Homes Unmasked,” highlighting the challenges in determining ownership of nursing home facilities in California, and the varying records of performance of those facilities. The Sacramento Bee reported that approximately half of California’s 120,000 licensed beds are controlled by 25 for-profit nursing home chains; 10 of them performed below statewide averages in 2013 in more than half of the examined quality-of-care categories, which measure frequency of incidences such as falls and infections. Furthermore, the articles stated that 20 of the top 25 chains fell below state averages in at least three out of five staffing measures.
- DPH Complaints and Investigations. Investigations of nursing home complaints and ERIs are carried out pursuant to both federal and state mandates. Current law requires DPH to make an onsite investigation of a complaint against a nursing home within 10 working days of receipt. If the complaint is an immediate jeopardy complaint, meaning that it involves a threat of imminent danger of death or serious bodily harm, DPH is required to make an onsite investigation within 24 hours of receipt. However, current law does not specify the length of time required to complete complaint investigations.
Longstanding concerns and complaints about the manner in which the L&C program managed complaint and ERI investigations have persisted for many years. In 2006, the Legislative Analyst’s Office reported that only one-half of all complaints not classified as immediate jeopardy were investigated within the required 10-day timeframe. Further, in 2007, the California State Auditor issued a report finding that the Department of Health Services (now referred to as DPH) struggled to initiate and close complaint investigations and communicate with complainants in a timely manner. In July 2012, CMS sent a letter to DPH expressing concern with its ability to meet many of its L&C responsibilities, including timely complaint investigations. The state was in jeopardy of losing $1 million in federal funds if certain benchmarks were not met. Ultimately, $138,123 in federal funding was withheld. - State Auditor Report. In October 2014, the California State Auditor released a report regarding the L&C Program citing ineffective management of nursing home complaint investigations. The key findings of that report included:
- As of April 2014, there were more than 11,000 open complaints and ERIs backlogged, many of which had relatively high priorities, and had remained open for an average of nearly a year;
- Despite backlogs and lengthy investigations, L&C does not have any policies or procedures to ensure prompt completion of complaint/ERI investigations and in many cases did not meet statutory timeframes for initiating complaint investigations;
- There was no staffing analysis for any of its district offices to determine how much staff is needed to complete workload. Most of the L&C district offices visited by audit staff reported not having the resources needed to investigate complaints properly, and having to work overtime in order to try to keep pace with workload; and,
- DPH failed to report all statutorily required information to the Legislature in certain years by omitting information related to the timeliness of complaint investigations in their 2012 and 2013 reports to the Legislature.
- As of April 2014, there were more than 11,000 open complaints and ERIs backlogged, many of which had relatively high priorities, and had remained open for an average of nearly a year;
- DPH’s Licensing and Certification (L&C) Program. DPH’s L&C Program is the DPH’s largest program and is responsible for the regulatory oversight of over 7,500 licensed health care facilities, 2,500 of which are LTC facilities such as SNFs and ICFs. Additionally, the federal CMS contracts with L&C to evaluate facilities accepting payments from Medicare and Medi-Cal, the state’s Medicaid program, to ensure that they meet federal requirements. The L&C Program evaluates health care facilities for compliance with state and federal laws and regulations through a variety of required tasks, including initial and re-licensure surveys, federal certification surveys, and investigations of complaints and entity-reported incidents (ERIs).
DPH responded that it agreed with the majority of the recommendations in the State Auditor’s report. However, DPH disagreed with the suggested implementation of various timelines, such as establishing timeframes in which to process and complete complaint and ERI investigations. According to the State Auditor’s most recent update, out of 18 recommendations suggested by the State Auditor in the report, only four have been fully implemented to date.
- SUPPORT. The California Advocates for Nursing Home Reform, a cosponsor of this bill, states this bill makes necessary reforms that are critically needed to protect nursing home residents from abuse, including mistreatment and death due to neglect by operators. The Office of the San Diego County District Attorney, also a co-sponsor of this bill, contends the lapse of oversight at DPH and the lack of accountability by nursing home owners and operators have left many California elders in grave danger. The sponsors state it is time for California to take strong steps to begin monitoring nursing home chains operating in the state to keep those unfit from acquiring nursing homes or expanding their operations, and to provide increased transparency to consumers and patients.
The California Long-Term Care Ombudsman Association supports this bill, stating this bill is a meaningful step toward improving transparency and consumer protections for SNF residents; local ombudsman representatives are often unable to identify the owners of SNFs are frequently discouraged to learn after working to assist a resident in transferring from a facility because of “consistently unsatisfactory care issues” only to discover later the resident has been transferred to another facility by the same operators but under a different corporate name. Supporters of this bill assert that under the current system, a family member can unknowingly transfer a loved one from one troubled nursing home facility to another without even knowing that the facilities are part of the same chain. Supporters also state that this bill will strengthen California law governing acquisition of nursing homes, suitability requirements for operators, and disclosure to the public on who owns nursing homes.
- OPPOSE UNLESS AMENDED. LeadingAge California opposes this bill unless it is amended, arguing that DPH should maintain the discretion to deny an application, and that mandating the denial of an application based solely on specific enforcement actions would limit DPH’s ability to determine the extent to which an individual was actually culpable for a deficient practice in the facility’s operations. LeadingAge California further contends some provisions of this bill are too broad and would leave potential applicants who own or manage even high-performing facilities at risk for denial. The California Association of Health Facilities (CAHF) also opposes this bill unless amended, stating that removing DPH’s discretion on license applications, and requiring mandatory denial of experienced operators under certain conditions will have a negative impact on California. CAHF further argues that California should not prohibit experienced operators from applying to own and operate new facilities, when the specifics of both the purchasing company and the company being acquired are very likely unique and should be looked at in isolation, an option that DPH currently has the authority to take action on. CAHF contends that consolidation is a current reality within the healthcare system, and because California is not increasing its bed supply in LTC facilities, ensuring the state can maintain the supply with experienced and skilled operators when facilities close is critical to dealing with consolidation.
- CONCERNS. The California Hospital Association submitted a letter of concern to the Committee regarding a previous version of this bill, stating that it supports transparency and the appropriate oversight of applications for SNF ownership and operation, however that the provisions in the previous version of this bill may discourage quality providers, including hospitals, health systems, and others, to acquire and establish SNFs to meet the need of the individuals and communities they serve.
- POLICY COMMENTS. This bill imposes a number of requirements on DPH regarding the collection and publication of information on SNFs and ICFs. In order to increase efficiency and ensure the timeliness of these requirements, the author may wish to consider the following amendments in the future.
- Searchable database. In an effort to increase transparency of information to the public regarding LTC facilities, this bill expands the data required to be posted on the statewide CISS. The author points to the current difficulty of obtaining ownership information for licensed LTC facilities, however the language does not explicitly dictate that the CISS be created in a user or consumer-friendly manner. To further the original intent of the bill, and to allow DPH staff to more easily access the compliance history of a particular individual or group, the author may wish to consider mandating that the CISS be created in a manner such that the information is able to be searched via the name of an individual who has an indirect or direct beneficial interest in an LTC facility.
- Deadlines for DPH. As stated, this bill increases the data required to be collected by DPH for publication on the statewide CISS. However, the bill language does not specify a deadline by which DPH must collect and publish the information. The 2014 State Auditor Report on DPH, discussed previously, highlights DPH’s poor history of timely implementation of the State Auditor’s recommendations and completion of certain tasks, such as final resolution of complaints at LTC facilities. To help establish oversight and ensure consumers and patients have access to LTC information in a timely manner, the author may wish to consider imposing a deadline on DPH to collect and publish all new information required for the statewide CISS under this bill.
- Searchable database. In an effort to increase transparency of information to the public regarding LTC facilities, this bill expands the data required to be posted on the statewide CISS. The author points to the current difficulty of obtaining ownership information for licensed LTC facilities, however the language does not explicitly dictate that the CISS be created in a user or consumer-friendly manner. To further the original intent of the bill, and to allow DPH staff to more easily access the compliance history of a particular individual or group, the author may wish to consider mandating that the CISS be created in a manner such that the information is able to be searched via the name of an individual who has an indirect or direct beneficial interest in an LTC facility.
- SUGGESTED AMENDMENTS. This bill establishes a number of additional disclosure and suitability requirements for licensure of SNFs and ICFs. Furthermore, this bill requires DPH to increase the transparency of information regarding ownership of such facilities. In order to ensure state resources are used more efficiently, and to better meet the original intent of the legislation, the Committee may wish to consider the following amendments:
- Establish stronger definitions to further intent. This bill includes additional requirements for applicants who have a direct and indirect beneficial interest in a healthcare facility when applying for additional facility licensure with DPH. The author contends it is in the best interest of the State to protect consumers and prevent existing owners with poor track records from opening new LTC facilities. However, not all LTC facilities are operated by management companies; federal law requires ICFs to have a governing body which meets specified criteria, but does not require a management company. And although it is an entity that should be held accountable, the owner or owners of LTC facilities may not be active in the daily operations of the facility. As such, the Committee may wish to amend this bill to instead apply the requirements to those who control the direction of the management or policies of a licensed facility, whether through ownership, contract, or otherwise.
- Conserve state staffing resources. This bill requires DPH to update the online profile of each LTC facility on the CISS, on a regular and timely basis, with current information regarding any appeal resolution pertaining to a citation or complaint. As discussed previously, DPH has a history of complaints with how it manages complaint investigations at LTC facilities, particularly the length of time in which it addresses complaints. As such, it is unknown if DPH would be able to accurately and regularly update the CISS. The Committee may wish to consider amending this bill to instead require DPH to update the online profiles of LTC facilities with the final disposition of a citation or complaint.
- Option to confirm with other state agencies. This bill requires applicants to disclose any history of compliance and noncompliance with any applicable state or federal law or regulation regarding specified facilities. It also requires applicants to disclose their relationships with other SNFs and ICFs. Although the language specifies certain circumstances by which to confirm information provided by an applicant, in order to ensure completeness and provide DPH with additional information, the Committee may wish to consider amending this bill to authorize DPH to contact other state agencies and departments to obtain information regarding an applicant’s compliance history.
- Establish consistency with existing law. This bill authorizes DPH to deny an application for licensure of a SNF or ICF if the applicant, within the past seven years, has prevented or attempted to impede the work of any authorized representative of DPH. Existing law under Health and Safety Code Section 1431 states it is a misdemeanor to willfully prevent, interfere with, or attempt to impede in any way, the work of, examination of records by, or preservation of evidence by, a duly authorized DPH representative who is enforcing current law. The current bill language is not fully consistent with current statute. The Committee may wish to consider aligning this bill with Health and Safety Code Section 1431.
- Establish stronger definitions to further intent. This bill includes additional requirements for applicants who have a direct and indirect beneficial interest in a healthcare facility when applying for additional facility licensure with DPH. The author contends it is in the best interest of the State to protect consumers and prevent existing owners with poor track records from opening new LTC facilities. However, not all LTC facilities are operated by management companies; federal law requires ICFs to have a governing body which meets specified criteria, but does not require a management company. And although it is an entity that should be held accountable, the owner or owners of LTC facilities may not be active in the daily operations of the facility. As such, the Committee may wish to amend this bill to instead apply the requirements to those who control the direction of the management or policies of a licensed facility, whether through ownership, contract, or otherwise.
The current language of this bill allows for DPH to deny an application for licensure after one occurrence of specified infractions. Some of these infractions may occur due to factors outside of the control of the facility, and may also be possible for a facility to remedy within 24 hours. Existing law also authorizes many state authorities to deny licensure to applicants upon a finding of a pattern of non-compliance with certain criteria rather than one occurrence, which protects those individuals who are impacted by events outside of their control. The Committee may wish to consider amending this bill to authorize DPH to deny applications for licensure if an applicant has demonstrated a pattern of non-compliance involving specified infractions. The Committee may also wish to consider excluding those infractions that can be remedied within 24 hours by a facility, and providing limited protection for those applicants who have unintentionally committed certain infractions, due to factors outside of their control.
- Eliminate provisions difficult to define. This bill authorizes DPH to deny an application if the applicant, within the past seven years, has failed to demonstrate competence in operating a facility. There are currently no standards by which DPH is required to assess one’s competence in operating a facility in statute; in addition, this bill does not provide guidance as to how this would be measured. This bill already addresses circumstances in which an applicant would be denied licensure due to a lack of compliance during operation of a facility, thus an additional criteria regarding competence may be unnecessary. As such, the Committee may wish to consider striking this provision.
- Modify mandatory denials to create accountability and consistency with current law. This bill requires DPH to deny an application for licensure of an SNF or ICF if the applicant owned, governed, or managed a LTC facility at a time during the seven-year period prior to the application in which that facility had an appointment of a court-ordered receiver, involuntary termination of federal certification, or issuance of a temporary suspension order or revocation of a facility’s license by DPH. In order to create accountability by the applicants, and to be consistent with current law, the Committee may wish to consider amending the provisions of this bill related to the automatic denial as follows:
- Optional leniency for appointments of court-ordered receivers. Existing law allows for certain state agencies to have some discretion in review of license applications under these circumstances, if an applicant demonstrates that the applicant took all reasonable actions to either prevent or correct violations that led to the receivership. The Committee may wish to consider amending this bill to provide DPH this discretion.
- Accountability after seven-year probationary period. The seven-year probationary period in this measure appears to be arbitrary, and the language is silent as to what occurs following this timeframe. The provisions also do not allow for applicants to prove that they are qualified to own a facility prior to the end of that seven-year period. Owners, administrators, and managers of LTC facilities are responsible for the well-being and health of many of our more fragile Californians. In order to ensure the safety of the state’s LTC residents and patients, the Committee may wish to consider amending this bill to require an applicant to prove to DPH that the applicant is qualified enough, following the seven-year period, to own, govern, or manage a licensed SNF or ICF, despite the previous violations. To provide more fairness to potential applicants during the timeframe of automatic denial, the Committee may wish allow an applicant to prove qualifications to own, govern, or manage a SNF or ICF to DPH, prior to the end of the seven-year period, under specified extenuating circumstances.
- Establish an appeals process for certain denials. Existing law allows applicants who have been denied approval for other licenses, permits, or similar authorization by a state department or agency to be able to appeal the decision of that department. The Committee may wish to consider amending this bill to be consistent with other areas of the law, and include the opportunity for an applicant to appeal a denial.
- Optional leniency for appointments of court-ordered receivers. Existing law allows for certain state agencies to have some discretion in review of license applications under these circumstances, if an applicant demonstrates that the applicant took all reasonable actions to either prevent or correct violations that led to the receivership. The Committee may wish to consider amending this bill to provide DPH this discretion.
- Eliminate provisions difficult to define. This bill authorizes DPH to deny an application if the applicant, within the past seven years, has failed to demonstrate competence in operating a facility. There are currently no standards by which DPH is required to assess one’s competence in operating a facility in statute; in addition, this bill does not provide guidance as to how this would be measured. This bill already addresses circumstances in which an applicant would be denied licensure due to a lack of compliance during operation of a facility, thus an additional criteria regarding competence may be unnecessary. As such, the Committee may wish to consider striking this provision.
- TECHNICAL AMENDMENT. In order to ensure consistency and clarity within this bill, the Committee may wish to consider amending this bill to further clarify the meaning of a single entity, consistent with existing law.
- PREVIOUS LEGISLATION.
- AB 348 (Brown) of 2015 would have established a timeframe under which DPH would be required to complete an investigation into a complaint about a LTC facility. AB 348 was held in the Senate Appropriations Committee.
- AB 1710 (Yamada), Chapter 672, Statutes of 2012, revises how nursing home administrator licensing fees are to be adjusted so that fee revenue is sufficient to cover the regulatory costs to DPH, and revises and increases DPH reporting requirements regarding the Nursing Home Administrator Program.
- SB 799 (Negrete-McLeod) of 2011 would have required DPH to complete LTC facility complaint investigations within a 90-working day period. SB 799 was held on suspense in Senate Appropriations.
- SB 535 (Kuehl) of 2008 would have directed DPH to establish a Website offering specified on-line information regarding LTC facilities. SB 535 was vetoed by the Governor.
- AB 399 (Feuer) of 2007 would have established a 40 day timeframe for DPH to complete a LTC facility complaint investigation. AB 399 was vetoed by the Governor.
- AB 1807 (Committee on Budget), Chapter 74, Statutes of 2006, was the health trailer bill for the Budget Act of 2006. Among other changes, AB 1807 establishes a new fee structure for health facilities that are licensed and/or certified by L&C: fees must be calculated based on: i) specified workload data provided by DPH to the Legislature and made available to the public on their Website; ii) any General Fund support appropriated by the Legislature; iii) any federal grant funds received for this purpose; and, iv) any policy adjustments as proposed by the Administration and as adopted by the Legislature. States intent that L&C become entirely supported by fees and federal funds by no later than July 1, 2009.
- SB 1312 (Alquist) Chapter 895, Statutes of 2006, requires inspections and investigations of LTC facilities certified by the Medicare or Medicaid program to determine compliance with federal standards and California statutes and regulations.
- AB 1731 (Shelley), Chapter 451, Statutes of 2000, enacts major reforms for SNFs and ICFs, including the expansion of citations and penalties, an increase in disclosure requirements and inspections, requires DPH to provide specified notice to complainants within specified timeframes, and requires initial onsite investigations within 24 hours in response to complaints where there is a serious threat of imminent danger of death or serious bodily harm.
- AB 348 (Brown) of 2015 would have established a timeframe under which DPH would be required to complete an investigation into a complaint about a LTC facility. AB 348 was held in the Senate Appropriations Committee.
REGISTERED SUPPORT / OPPOSITION:
Support
California Advocates for Nursing Home Reform (cosponsor)
Office of the San Diego County District Attorney (cosponsor)
AARP
American Federation of State, County and Municipal Employees (previous version)
The Arc and United Cerebral Palsy California Collaboration
Area 3 Agency on Aging Advisory Council
Asian Law Alliance (previous version)
California Commission on Aging (previous version)
California Long-Term Care Ombudsman Association
California Retired Teachers Association (previous version)
Coalition of California Welfare Rights Organizations, Inc. (previous version)
Congress of California Seniors (previous version)
Consumer Attorneys of California
Consumer Federation of California
Disability Rights California
National Association of Social Workers – California Chapter
Office of the District Attorney of Alameda County
Office of the State Long-Term Care Ombudsman
Several individuals
Several law firms
Opposition
California Association of Health Facilities
LeadingAge California
Analysis Prepared by: An-Chi Tsou / HEALTH / (916) 319-2097
Bill Author
