(a)(1)The department shall adopt regulations setting forth the minimum number of equivalent direct care service hours per patient required in intermediate care facilities, subject to the specific requirements of Section 14110.7 of the Welfare and Institutions Code.

(2)For the purposes of this subdivision, direct care service hours means the number of hours of work performed per patient day by aides, nursing assistants, or orderlies plus two times the number of hours worked per patient day by registered nurses and licensed vocational nurses (except directors of nursing in facilities of 60 or larger capacity) and, in the distinct part of facilities and freestanding facilities providing care for persons with developmental disabilities or mental health disorders by licensed psychiatric technicians who perform direct nursing services for patients in intermediate care facilities, except when the intermediate care facility is licensed as a part of a state hospital.

(b)(1)The department shall adopt regulations setting forth the minimum number of equivalent direct care service hours per patient required in skilled nursing facilities, subject to the specific requirements of Section 14110.7 of the Welfare and Institutions Code. However, notwithstanding Section 14110.7 of the Welfare and Institutions Code or any other law, the minimum number of direct care service hours per patient required in a skilled nursing facility shall be 3.2 hours, and, commencing July 1, 2016, shall be 4.1 hours, except as provided in paragraph (2) or Section 1276.9.

(2)Notwithstanding Section 14110.7 or any other law, the minimum number of direct care service hours per patient required in a skilled nursing facility that is a distinct part of a facility licensed as a general acute care hospital shall be 3.2 hours, except as provided in Section 1276.9.

(3)For the purposes of this subdivision, direct care service hours means the number of hours of work performed per patient day by a direct caregiver, as defined in Section 1276.65, and, in the distinct part of facilities and freestanding facilities providing care for persons with developmental disabilities or mental health disorders, by licensed psychiatric technicians who perform direct nursing services for patients in skilled nursing facilities. 1276.65.

(c)Notwithstanding Section 1276, the department shall require the utilization of a registered nurse at all times if the department determines that the services of a skilled nursing and intermediate care facility require the utilization of a registered nurse.

(d)(1)Except as otherwise provided by law, the administrator of an intermediate care facility/developmentally disabled, intermediate care facility/developmentally disabled habilitative, or an intermediate care facility/developmentally disablednursing shall be either a licensed nursing home administrator or a qualified intellectual disability professional as defined in Section 483.430 of Title 42 of the Code of Federal Regulations.

(2)To qualify as an administrator for an intermediate care facility for the developmentally disabled, a qualified intellectual disability professional shall complete at least six months of administrative training or demonstrate six months of experience in an administrative capacity in a licensed health facility, as defined in Section 1250, excluding those facilities specified in subdivisions (e), (h), and (i).

(a)For purposes of this section, the following definitions shall apply:

(1)(A)Direct caregiver means a registered nurse, as referred to in Section 2732 of the Business and Professions Code, a licensed vocational nurse, as referred to in Section 2864 of the Business and Professions Code, a psychiatric technician, as referred to in Section 4516 of the Business and Professions Code, a certified nurse assistant, as defined in Section 1337, or a certified nurse assistant in an approved training program, as defined in Section 1337, while the certified nurse assistant in an approved training program is performing nursing services as described in Section Sections 72309, 72311, and 72315 of Title 22 of the California Code of Regulations.

(B)Direct caregiver also includes (i) a licensed nurse serving as a minimum data set coordinator and (ii) a person serving as the director of nursing services in a facility with 60 or more licensed beds and a person serving as the director of staff development when that person is providing nursing services in the hours beyond those required to carry out the duties of these positions, as long as these direct care service hours are separately documented.

(2)Licensed nurse means a registered nurse, as referred to in Section 2732 of the Business and Professions Code, a licensed vocational nurse, as referred to in Section 2864 of the Business and Professions Code, and a psychiatric technician, as referred to in Section 4516 of the Business and Professions Code.

(3)Skilled nursing facility means a skilled nursing facility as defined in subdivision (c) of Section 1250, except a skilled nursing facility that is a distinct part of a facility licensed as a general acute care hospital. 1250.

(b)A person employed to provide services such as food preparation, housekeeping, laundry, or maintenance services shall not provide nursing care to residents and shall not be counted in determining ratios under this section.

(c)(1)(A)Notwithstanding any other law, the State Department of Public Health shall develop regulations that become effective July 1, 2016, that establish a minimum staff-to-patient ratio for direct caregivers working in a skilled nursing facility. The ratio shall include as a part of the overall staff-to-patient ratio, specific staff-to-patient ratios for licensed nurses and certified nurse assistants.

(B)(i)The For a skilled nursing facility that is not a distinct part of a general acute care hospital, the certified nurse assistant staff-to-patient ratios developed pursuant to subparagraph (A) shall be no less than the following:

(I)During the day shift, a minimum of one certified nurse assistant for every six patients, or fraction thereof.

(II)During the evening shift, a minimum of one certified nurse assistant for every eight patients, or fraction thereof.

(III)During the night shift, a minimum of one certified nurse assistant for every 17 patients, or fraction thereof.

(ii)For the purposes of this subparagraph, the following terms have the following meanings:

(I)Day shift means the 8-hour period during which the facilitys patients require the greatest amount of care.

(II)Evening shift means the 8-hour period when the facilitys patients require a moderate amount of care.

(III)Night shift means the 8-hour period during which a facilitys patients require the least amount of care.

(2)The department, in developing an overall staff-to-patient ratio for direct caregivers, and in developing specific staff-to-patient ratios for certified nurse assistants and licensed nurses as required by this section, shall convert the requirement under Section 1276.5 of this code and Section 14110.7 of the Welfare and Institutions Code for 3.2 direct care service hours per patient day care, and commencing July 1, 2016, except as specified in paragraph (2) of subdivision (b) of Section 1276.5, for 4.1 direct care service hours per patient day, including a minimum staff-to-patient ratio for certified nurse assistants of 2.8 direct care service hours per patient day for certified nurse assistants, and a minimum staff-to-patient ratio for licensed nurses of 1.3 direct care service hours per patient day, day for licensed nurses, and shall ensure that no less care is given than is required pursuant to Section 1276.5 of this code and Section 14110.7 of the Welfare and Institutions Code. Further, the department shall develop the ratios in a manner that maximizes resident access to care, and takes into account the length of the shift worked. In developing the regulations, the department shall develop a procedure for facilities to apply for a waiver that addresses individual patient needs except that in no instance shall the minimum staff-to-patient ratios be less than the 3.2 direct care service hours per patient day, and, commencing July 1, 2016, except as specified in paragraph (2) of subdivision (b) of Section 1276.5, be less than the 4.1 direct care service hours per patient day, required under Section 1276.5 of this code and Section 14110.7 of the Welfare and Institutions Code.

(d)The staffing ratios to be developed pursuant to this section shall be minimum standards only and shall be satisfied daily. Skilled nursing facilities shall employ and schedule additional staff as needed to ensure quality resident care based on the needs of individual residents and to ensure compliance with all relevant state and federal staffing requirements.

(e)No later than January 1, 2018, and every five years thereafter, the department shall consult with consumers, consumer advocates, recognized collective bargaining agents, and providers to determine the sufficiency of the staffing standards provided in this section and may adopt regulations to increase the minimum staffing ratios to adequate levels.

(f)(1)In a manner pursuant to federal requirements, effective January 1, 2003, every skilled nursing facility shall post information about resident census and staffing levels that includes the current number of licensed and unlicensed nursing staff directly responsible for resident care in the facility. This posting shall include staffing requirements developed pursuant to this section and an accurate report of the number of direct care staff working during the current shift, including a report of the number of registered nurses, licensed vocational nurses, psychiatric technicians, and certified nurse assistants. The information shall be posted on paper that is at least 8.5 inches by 14 inches and shall be printed in a font of at least 16 point.

(2)The information described in paragraph (1) shall be posted daily, at a minimum, in the following locations:

(A)An area readily accessible to members of the public.

(B)An area used for employee breaks.

(C)An area used by residents for communal functions, including, but not limited to, dining, resident council meetings, or activities.

(3)(A)Upon oral or written request, every skilled nursing facility shall make direct caregiver staffing data available to the public for review at a reasonable cost. A skilled nursing facility shall provide the data to the requestor within 15 days after receiving a request.

(B)For the purpose of this paragraph, reasonable cost includes, but is not limited to, a ten-cent ($0.10) per page fee for standard reproduction of documents that are 8.5 inches by 14 inches or smaller or a retrieval or processing fee not exceeding sixty dollars ($60) if the requested data is provided on a digital or other electronic medium and the requestor requests delivery of the data in a digital or other electronic medium, including electronic mail.

(g)(1)Notwithstanding any other law, the department shall inspect for compliance with this section during state and federal periodic inspections, including, but not limited to, those inspections required under Section 1422. This inspection requirement shall not limit the departments authority in other circumstances to cite for violations of this section or to inspect for compliance with this section.

(2)A violation of the regulations developed pursuant to this section may constitute a class B, A, or AA violation pursuant to the standards set forth in Section 1424.

(h)The requirements of this section are in addition to any requirement set forth in Section 1276.5 of this code and Section 14110.7 of the Welfare and Institutions Code.

(i)In implementing this section, the department may contract as necessary, on a bid or nonbid basis, for professional consulting services from nationally recognized higher education and research institutions, or other qualified individuals and entities not associated with a skilled nursing facility, with demonstrated expertise in long-term care. This subdivision establishes an accelerated process for issuing contracts pursuant to this section and contracts entered into pursuant to this section shall be exempt from the requirements of Chapter 1 (commencing with Section 10100) and Chapter 2 (commencing with Section 10290) of Part 2 of Division 2 of the Public Contract Code.

(j)This section shall not apply to facilities defined in Section 1276.9.

(a)In skilled nursing facilities to 4.1, in facilities, the minimum number of equivalent direct care service hours shall be 3.2, except as set forth in Section 1276.9 of the Health and Safety Code.

(c)In skilled nursing facilities with special treatment programs to 2.3, in programs, the minimum number of equivalent direct care service hours shall be 2.3.

(d)In intermediate care facilities to 1.1, and in facilities, the minimum number of equivalent direct care service hours shall be 1.1.

(e)In intermediate care facilities/developmentally disabled to 2.7. disabled, the minimum number of equivalent direct care service hours shall be 2.7.

(a)(1)By August 1, 2011, the department shall develop the Skilled Nursing Facility Quality and Accountability Supplemental Payment System, subject to approval by the federal Centers for Medicare and Medicaid Services, and the availability of federal, state, or other funds.

(2)(A)The system shall be utilized to provide supplemental payments to skilled nursing facilities that improve the quality and accountability of care rendered to residents in skilled nursing facilities, as defined in subdivision (c) of Section 1250 of the Health and Safety Code, and to penalize those facilities that do not meet measurable standards.

(B)A freestanding pediatric subacute care facility, as defined in Section 51215.8 of Title 22 of the California Code of Regulations, shall be exempt from the Skilled Nursing Facility Quality and Accountability Supplemental Payment System.

(3)The system shall be phased in, beginning with the 201011 rate year.

(4)The department may utilize the system to do all of the following:

(A)Assess overall facility quality of care and quality of care improvement, and assign quality and accountability payments to skilled nursing facilities pursuant to performance measures described in subdivision (i).

(B)Assign quality and accountability payments or penalties relating to quality of care, or direct care staffing levels, wages, and benefits, or both.

(C)Limit the reimbursement of legal fees incurred by skilled nursing facilities engaged in the defense of governmental legal actions filed against the facilities.

(D)Publish each facilitys quality assessment and quality and accountability payments in a manner and form determined by the director, or his or her designee.

(E)Beginning with the 201112 fiscal year, establish a base year to collect performance measures described in subdivision (i).

(F)Beginning with the 201112 fiscal year, in coordination with the State Department of Public Health, publish the direct care staffing level data and the performance measures required pursuant to subdivision (i).

(b)(1)There is hereby created in the State Treasury, the Skilled Nursing Facility Quality and Accountability Special Fund. The fund shall contain moneys deposited pursuant to subdivisions (g) and (j) to (l), inclusive. Notwithstanding Section 16305.7 of the Government Code, the fund shall contain all interest and dividends earned on moneys in the fund.

(2)Notwithstanding Section 13340 of the Government Code, the fund shall be continuously appropriated without regard to fiscal year to the department for making quality and accountability payments, in accordance with subdivision (m), to facilities that meet or exceed predefined measures as established by this section.

(3)Upon appropriation by the Legislature, moneys in the fund may also be used for any of the following purposes:

(A)To cover the administrative costs incurred by the State Department of Public Health for positions and contract funding required to implement this section.

(B)To cover the administrative costs incurred by the State Department of Health Care Services for positions and contract funding required to implement this section.

(C)To provide funding assistance for the Long-Term Care Ombudsman Program activities pursuant to Chapter 11 (commencing with Section 9700) of Division 8.5.

(c)No appropriation associated with this bill is intended to implement the provisions of Section 1276.65 of the Health and Safety Code.

(d)(1)There is hereby appropriated for the 201011 fiscal year, one million nine hundred thousand dollars ($1,900,000) from the Skilled Nursing Facility Quality and Accountability Special Fund to the California Department of Aging for the Long-Term Care Ombudsman Program activities pursuant to Chapter 11 (commencing with Section 9700) of Division 8.5. It is the intent of the Legislature for the one million nine hundred thousand dollars ($1,900,000) from the fund to be in addition to the four million one hundred sixty-eight thousand dollars ($4,168,000) proposed in the Governors May Revision for the 201011 Budget. It is further the intent of the Legislature to increase this level of appropriation in subsequent years to provide support sufficient to carry out the mandates and activities pursuant to Chapter 11 (commencing with Section 9700) of Division 8.5.

(2)The department, in partnership with the California Department of Aging, shall seek approval from the federal Centers for Medicare and Medicaid Services to obtain federal Medicaid reimbursement for activities conducted by the Long-Term Care Ombudsman Program. The department shall report to the fiscal committees of the Legislature during budget hearings on progress being made and any unresolved issues during the 201112 budget deliberations.

(e)There is hereby created in the Special Deposit Fund established pursuant to Section 16370 of the Government Code, the Skilled Nursing Facility Minimum Staffing Penalty Account. The account shall contain all moneys deposited pursuant to subdivision (f).

(f)(1)Beginning with the 201011 fiscal year, the State Department of Public Health shall use the direct care staffing level data it collects to determine whether a skilled nursing facility has met the direct care service hours per patient per day requirements pursuant to Section 1276.5 of the Health and Safety Code.

(2)(A)Beginning with the 201011 fiscal year, the State Department of Public Health shall assess a skilled nursing facility, licensed pursuant to subdivision (c) of Section 1250 of the Health and Safety Code, an administrative penalty if the State Department of Public Health determines that the skilled nursing facility fails to meet the direct care service hours per patient per day requirements pursuant to Section 1276.5 of the Health and Safety Code as follows:

(i)Fifteen thousand dollars ($15,000) if the facility fails to meet the requirements for 5 percent or more of the audited days up to 49 percent.

(ii)Thirty thousand dollars ($30,000) if the facility fails to meet the requirements for over 49 percent or more of the audited days.

(B)(i)If the skilled nursing facility does not dispute the determination or assessment, the penalties shall be paid in full by the licensee to the State Department of Public Health within 30 days of the facilitys receipt of the notice of penalty and deposited into the Skilled Nursing Facility Minimum Staffing Penalty Account.

(ii)The State Department of Public Health may, upon written notification to the licensee, request that the department offset any moneys owed to the licensee by the Medi-Cal program or any other payment program administered by the department to recoup the penalty provided for in this section.

(C)(i)If a facility disputes the determination or assessment made pursuant to this paragraph, the facility shall, within 15 days of the facilitys receipt of the determination and assessment, simultaneously submit a request for appeal to both the department and the State Department of Public Health. The request shall include a detailed statement describing the reason for appeal and include all supporting documents the facility will present at the hearing.

(ii)Within 10 days of the State Department of Public Healths receipt of the facilitys request for appeal, the State Department of Public Health shall submit, to both the facility and the department, all supporting documents that will be presented at the hearing.

(D)The department shall hear a timely appeal and issue a decision as follows:

(i)The hearing shall commence within 60 days from the date of receipt by the department of the facilitys timely request for appeal.

(ii)The department shall issue a decision within 120 days from the date of receipt by the department of the facilitys timely request for appeal.

(iii)The decision of the departments hearing officer, when issued, shall be the final decision of the State Department of Public Health.

(E)The appeals process set forth in this paragraph shall be exempt from Chapter 4.5 (commencing with Section 11400) and Chapter 5 (commencing with Section 11500), of Part 1 of Division 3 of Title 2 of the Government Code. The provisions of Section 100171 and 131071 of the Health and Safety Code shall not apply to appeals under this paragraph.

(F)If a hearing decision issued pursuant to subparagraph (D) is in favor of the State Department of Public Health, the skilled nursing facility shall pay the penalties to the State Department of Public Health within 30 days of the facilitys receipt of the decision. The penalties collected shall be deposited into the Skilled Nursing Facility Minimum Staffing Penalty Account.

(G)The assessment of a penalty under this subdivision does not supplant the State Department of Public Healths investigation process or issuance of deficiencies or citations under Chapter 2.4 (commencing with Section 1417) of Division 2 of the Health and Safety Code.

(g)The State Department of Public Health shall transfer, on a monthly basis, all penalty payments collected pursuant to subdivision (f) into the Skilled Nursing Facility Quality and Accountability Special Fund.

(h)Nothing in this section shall impact the effectiveness or utilization of Section 1278.5 or 1432 of the Health and Safety Code relating to whistleblower protections, or Section 1420 of the Health and Safety Code relating to complaints.

(i)(1)Beginning in the 201011 fiscal year, the department, in consultation with representatives from the long-term care industry, organized labor, and consumers, shall establish and publish quality and accountability measures, benchmarks, and data submission deadlines by November 30, 2010.

(2)The methodology developed pursuant to this section shall include, but not be limited to, the following requirements and performance measures:

(A)Beginning in the 201112 fiscal year:

(i)Immunization rates.

(ii)Facility acquired pressure ulcer incidence.

(iii)The use of physical restraints.

(iv)Compliance with the direct care service hours per patient per day requirements pursuant to Section 1276.5 of the Health and Safety Code.

(v)Resident and family satisfaction.

(vi)Direct care staff retention, if sufficient data is available.

(B)Beginning in the 201617 fiscal year, compliance with the direct care service hour requirements for skilled nursing facilities established pursuant to Section 1276.65 of the Health and Safety Code and Section 14110.7.

(C)If this act is extended beyond the dates on which it becomes inoperative and is repealed, in accordance with Section 14126.033, the department, in consultation with representatives from the long-term care industry, organized labor, and consumers, beginning in the 201314 rate year, shall incorporate additional measures into the system, including, but not limited to, quality and accountability measures required by federal health care reform that are identified by the federal Centers for Medicare and Medicaid Services.

(D)The department, in consultation with representatives from the long-term care industry, organized labor, and consumers, may incorporate additional performance measures, including, but not limited to, the following:

(i)Compliance with state policy associated with the United States Supreme Court decision in Olmstead v. L.C. ex rel. Zimring (1999) 527 U.S. 581.

(ii)Direct care staff retention, if not addressed in the 201213 rate year.

(iii)The use of chemical restraints.

(j) (1) Beginning with the 201011 rate year, and pursuant to subparagraph (B) of paragraph (5) of subdivision (a) of Section 14126.023, the department shall set aside savings achieved from setting the professional liability insurance cost category, including any insurance deductible costs paid by the facility, at the 75th percentile. From this amount, the department shall transfer the General Fund portion into the Skilled Nursing Facility Quality and Accountability Special Fund. A skilled nursing facility shall provide supplemental data on insurance deductible costs to facilitate this adjustment, in the format and by the deadlines determined by the department. If this data is not provided, a facilitys insurance deductible costs will remain in the administrative costs category.

(2)Notwithstanding paragraph (1), for the 201213 rate year only, savings from capping the professional liability insurance cost category pursuant to paragraph (1) shall remain in the General Fund and shall not be transferred to the Skilled Nursing Facility Quality and Accountability Special Fund.

(k)Beginning with the 201314 rate year, if there is a rate increase in the weighted average Medi-Cal reimbursement rate, the department shall set aside the first 1 percent of the weighted average Medi-Cal reimbursement rate increase for the Skilled Nursing Facility Quality and Accountability Special Fund.

(l)If this act is extended beyond the dates on which it becomes inoperative and is repealed, in accordance with Section 14126.033, beginning with the 201415 rate year, in addition to the amount set aside pursuant to subdivision (k), if there is a rate increase in the weighted average Medi-Cal reimbursement rate, the department shall set aside at least one-third of the weighted average Medi-Cal reimbursement rate increase, up to a maximum of 1 percent, from which the department shall transfer the General Fund portion of this amount into the Skilled Nursing Facility Quality and Accountability Special Fund.

(m)(1) (A) Beginning with the 201314 rate year, the department shall pay a supplemental payment, by April 30, 2014, to skilled nursing facilities based on all of the criteria in subdivision (i), as published by the department, and according to performance measure benchmarks determined by the department in consultation with stakeholders.

(B)(i)The department may convene a diverse stakeholder group, including, but not limited to, representatives from consumer groups and organizations, labor, nursing home providers, advocacy organizations involved with the aging community, staff from the Legislature, and other interested parties, to discuss and analyze alternative mechanisms to implement the quality and accountability payments provided to nursing homes for reimbursement.

(ii)The department shall articulate in a report to the fiscal and appropriate policy committees of the Legislature the implementation of an alternative mechanism as described in clause (i) at least 90 days prior to any policy or budgetary changes, and seek subsequent legislation in order to enact the proposed changes.

(2)Skilled nursing facilities that do not submit required performance data by the departments specified data submission deadlines pursuant to subdivision (i) shall not be eligible to receive supplemental payments.

(3)Notwithstanding paragraph (1), if a facility appeals the performance measure of compliance with the direct care service hours per patient per day requirements, pursuant to Section 1276.5 of the Health and Safety Code, to the State Department of Public Health, and it is unresolved by the departments published due date, the department shall not use that performance measure when determining the facilitys supplemental payment.

(4)Notwithstanding paragraph (1), if the department is unable to pay the supplemental payments by April 30, 2014, then on May 1, 2014, the department shall use the funds available in the Skilled Nursing Facility Quality and Accountability Special Fund as a result of savings identified in subdivisions (k) and (l), less the administrative costs required to implement subparagraphs (A) and (B) of paragraph (3) of subdivision (b), in addition to any Medicaid funds that are available as of December 31, 2013, to increase provider rates retroactively to August 1, 2013.

(n)The department shall seek necessary approvals from the federal Centers for Medicare and Medicaid Services to implement this section. The department shall implement this section only in a manner that is consistent with federal Medicaid law and regulations, and only to the extent that approval is obtained from the federal Centers for Medicare and Medicaid Services and federal financial participation is available.

(o)In implementing this section, the department and the State Department of Public Health may contract as necessary, with Californias Medicare Quality Improvement Organization, or other entities deemed qualified by the department or the State Department of Public Health, not associated with a skilled nursing facility, to assist with development, collection, analysis, and reporting of the performance data pursuant to subdivision (i), and with demonstrated expertise in long-term care quality, data collection or analysis, and accountability performance measurement models pursuant to subdivision (i). This subdivision establishes an accelerated process for issuing any contract pursuant to this section. Any contract entered into pursuant to this subdivision shall be exempt from the requirements of the Public Contract Code, through December 31, 2013.

(p)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the following shall apply:

(1)The director shall implement this section, in whole or in part, by means of provider bulletins, or other similar instructions without taking regulatory action.

(2)The State Public Health Officer may implement this section by means of all facility letters, or other similar instructions without taking regulatory action.

(q)Notwithstanding paragraph (1) of subdivision (m), if a final judicial determination is made by any state or federal court that is not appealed, in any action by any party, or a final determination is made by the administrator of the federal Centers for Medicare and Medicaid Services, that any payments pursuant to subdivisions (a) and (m), are invalid, unlawful, or contrary to any provision of federal law or regulations, or of state law, these subdivisions shall become inoperative, and for the 201112 rate year, the rate increase provided under subparagraph (A) of paragraph (4) of subdivision (c) of Section 14126.033 shall be reduced by the amounts described in subdivision (j). For the 201314 rate year, and for each subsequent rate year, any rate increase shall be reduced by the amounts described in subdivisions (j) to (l), inclusive.

(a)(1)The department shall adopt regulations setting forth the minimum number of equivalent nursing hours direct care service hours per patient required in skilled nursing and intermediate care facilities, subject to the specific requirements of Section 14110.7 of the Welfare and Institutions Code. However, notwithstanding Section 14110.7 or any other law, commencing January 1, 2000, the minimum number of actual nursing hours per patient required in a skilled nursing facility shall be 3.2 hours, except as provided in Section 1276.9.

(2)For the purposes of this section, nursing hours subdivision, direct care service hours means the number of hours of work performed per patient day by aides, nursing assistants, or orderlies plus two times the number of hours worked per patient day by registered nurses and licensed vocational nurses (except directors of nursing in facilities of 60 or larger capacity) and, in the distinct part of facilities and freestanding facilities providing care for persons with developmental disabilities or mental health disorders by licensed psychiatric technicians who perform direct nursing services for patients in skilled nursing and intermediate care facilities, except when the skilled nursing and intermediate care facility is licensed as a part of a state hospital, and except that nursing hours for skilled nursing facilities means the actual hours of work, without doubling the hours performed per patient day by registered nurses and licensed vocational nurses. hospital.

(c)Notwithstanding Section 1276, the department shall require the utilization of a registered nurse at all times if the department determines that the services of a skilled nursing and intermediate care facility require the utilization of a registered nurse.

(d)(1)Except as otherwise provided by law, the administrator of an intermediate care facility/developmentally disabled, intermediate care facility/developmentally disabled habilitative, or an intermediate care facility/developmentally disablednursing shall be either a licensed nursing home administrator or a qualified intellectual disability professional as defined in Section 483.430 of Title 42 of the Code of Federal Regulations.

(2)To qualify as an administrator for an intermediate care facility for the developmentally disabled, a qualified intellectual disability professional shall complete at least six months of administrative training or demonstrate six months of experience in an administrative capacity in a licensed health facility, as defined in Section 1250, excluding those facilities specified in subdivisions (e), (h), and (i).

(a)For purposes of this section, the following definitions shall apply:

(1)(A)Direct caregiver means a registered nurse, as referred to in Section 2732 of the Business and Professions Code, a licensed vocational nurse, as referred to in Section 2864 of the Business and Professions Code, a psychiatric technician, as referred to in Section 4516 of the Business and Professions Code, and a certified nurse assistant, as defined in Section 1337. 1337, or a certified nurse assistant in an approved training program, as defined in Section 1337, while the certified nurse assistant in an approved training program is performing nursing services as described in Section 72309, 72311, and 72315 of Title 22 of the California Code of Regulations.

(3)Skilled nursing facility means a skilled nursing facility as defined in subdivision (c) of Section 1250. 1250, except a skilled nursing facility that is a distinct part of a facility licensed as a general acute care hospital.

(b)A person employed to provide services such as food preparation, housekeeping, laundry, or maintenance services shall not provide nursing care to residents and shall not be counted in determining ratios under this section.

(c)(1)(A)Notwithstanding any other law, the State Department of Public Health shall develop regulations that become effective June July 1, 2016, that establish a minimum staff-to-patient ratios ratio for direct caregivers working in a skilled nursing facility. These ratios The ratio shall include separate as a part of the overall staff-to-patient ratio, specific staff-to patient ratios for licensed nurse staff-to-patient ratios nurses and certified nurse assistant staff-to-patient ratios, in addition to the ratios established for other direct caregivers. assistants.

(B)(i)The certified nurse assistant staff-to-patient ratios developed pursuant to subparagraph (A) shall be no less than the following:

(I)During the day shift, a minimum of one certified nurse assistant for every five six patients, or fraction thereof.

(II)During the evening shift, a minimum of one certified nurse assistant for every seven eight patients, or fraction thereof.

(III)During the night shift, a minimum of one certified nurse assistant for every 16 17 patients, or fraction thereof.

(ii)For the purposes of this subparagraph, the following terms have the following meanings:

(I)Day shift means the 8-hour period during which the facilitys patients require the greatest amount of care.

(II)Evening shift means the 8-hour period when the facilitys patients require more than minimal a moderate amount of care.

(III)Night shift means the 8-hour period during which a facilitys patients require the least amount of care.

(2)The department, in developing an overall staff-to-patient ratios ratio for direct caregivers, and in developing specific staff-to-patient ratios for certified nurse assistants, assistants and licensed nurses required by this section, shall convert the existing requirement under Section 1276.5 of this code and Section 14110.7 of the Welfare and Institutions Code for 3.2 nursing direct care service hours per patient day of care care, and commencing July 1, 2016, for 4.1 direct care service hours per patient day, including a minimum staff-to-patient ratio for certified nurse assistants of 2.8 direct care service hours per patient day and a minimum staff-to-patient ratio for licensed nurses of 1.3 direct care service hours per patient day, and shall ensure that no less care is given than is required pursuant to Section 1276.5 of this code and Section 14110.7 of the Welfare and Institutions Code. Further, the department shall develop the ratios in a manner that minimizes additional state costs, maximizes resident access to care, and takes into account the length of the shift worked. In developing the regulations, the department shall develop a procedure for facilities to apply for a waiver that addresses individual patient needs except that in no instance shall the minimum staff-to-patient ratios be less than the 3.2 nursing direct care service hours per patient day day, and, commencing July 1, 2016, be less than the 4.1 direct care service hours per patient day, required under Section 1276.5 of this code and Section 14110.7 of the Welfare and Institutions Code.

(d)The staffing ratios to be developed pursuant to this section shall be minimum standards only. only and shall be satisfied daily. Skilled nursing facilities shall employ and schedule additional staff as needed to ensure quality resident care based on the needs of individual residents and to ensure compliance with all relevant state and federal staffing requirements.

(e)No later than January 1, 2006, 2018, and every five years thereafter, the department shall consult with consumers, consumer advocates, recognized collective bargaining agents, and providers to determine the sufficiency of the staffing standards provided in this section and may adopt regulations to increase the minimum staffing ratios to adequate levels.

(f)(1)In a manner pursuant to federal requirements, effective January 1, 2003, every skilled nursing facility shall post information about resident census and staffing levels that includes the current number of licensed and unlicensed nursing staff directly responsible for resident care in the facility. This posting shall include staffing requirements developed pursuant to this section and an accurate report of the number of direct care staff working each shift. during the current shift, including a report of the number of registered nurses, licensed vocational nurses, psychiatric technicians, and certified nurse assistants. The information shall be posted on paper that is at least 8.5 inches by 14 inches and shall be printed in a font of at least 16 point.

(2)The information described in paragraph (1) shall be posted, posted daily, at a minimum, in the following locations:

(A)An area readily accessible to members of the public.

(B)An area used for employee breaks.

(C)An area used by residents for communal functions, including, but not limited to, dining, resident council meetings, or activities.

(3)(A)Upon oral or written request, every skilled nursing facility shall make direct caregiver staffing data available to the public for review at a reasonable cost. A skilled nursing facility shall provide the data to the requestor within 15 days after receiving a request.

(B)For the purpose of this paragraph, reasonable cost includes, but is not limited to, a ten-cent ($0.10) per page fee for standard reproduction of documents that are 8.5 inches by 14 inches or smaller or a retrieval or processing fee not exceeding sixty dollars ($60) if the requested data is provided on a digital or other electronic medium and the requestor requests delivery of the data in a digital or other electronic medium, including electronic mail.

(g)(1)Notwithstanding any other law, the department shall inspect for compliance with this section during state and federal periodic inspections, including, but not limited to, those inspections required under Section 1422. This inspection requirement shall not limit the departments authority in other circumstances to cite for violations of this section or to inspect for compliance with this section.

(2)A violation of the regulations developed pursuant to this section may constitute a class B, A, or AA violation pursuant to the standards set forth in Section 1424.

(h)The requirements of this section are in addition to any requirement set forth in Section 1276.5 of this code and Section 14110.7 of the Welfare and Institutions Code.

(i)In implementing this section, the department may contract as necessary, on a bid or nonbid basis, for professional consulting services from nationally recognized higher education and research institutions, or other qualified individuals and entities not associated with a skilled nursing facility, with demonstrated expertise in long-term care. This subdivision establishes an accelerated process for issuing contracts pursuant to this section and contracts entered into pursuant to this section shall be exempt from the requirements of Chapter 1 (commencing with Section 10100) and Chapter 2 (commencing with Section 10290) of Part 2 of Division 2 of the Public Contract Code.

(j)This section shall not apply to facilities defined in Section 1276.9.

(a)(1)By August 1, 2011, the department shall develop the Skilled Nursing Facility Quality and Accountability Supplemental Payment System, subject to approval by the federal Centers for Medicare and Medicaid Services, and the availability of federal, state, or other funds.

(2)(A)The system shall be utilized to provide supplemental payments to skilled nursing facilities that improve the quality and accountability of care rendered to residents in skilled nursing facilities, as defined in subdivision (c) of Section 1250 of the Health and Safety Code, and to penalize those facilities that do not meet measurable standards.

(B)A freestanding pediatric subacute care facility, as defined in Section 51215.8 of Title 22 of the California Code of Regulations, shall be exempt from the Skilled Nursing Facility Quality and Accountability Supplemental Payment System.

(3)The system shall be phased in, beginning with the 201011 rate year.

(4)The department may utilize the system to do all of the following:

(A)Assess overall facility quality of care and quality of care improvement, and assign quality and accountability payments to skilled nursing facilities pursuant to performance measures described in subdivision (i).

(B)Assign quality and accountability payments or penalties relating to quality of care, or direct care staffing levels, wages, and benefits, or both.

(C)Limit the reimbursement of legal fees incurred by skilled nursing facilities engaged in the defense of governmental legal actions filed against the facilities.

(D)Publish each facilitys quality assessment and quality and accountability payments in a manner and form determined by the director, or his or her designee.

(E)Beginning with the 201112 fiscal year, establish a base year to collect performance measures described in subdivision (i).

(F)Beginning with the 201112 fiscal year, in coordination with the State Department of Public Health, publish the direct care staffing level data and the performance measures required pursuant to subdivision (i).

(b)(1)There is hereby created in the State Treasury, the Skilled Nursing Facility Quality and Accountability Special Fund. The fund shall contain moneys deposited pursuant to subdivisions (g) and (j) to (l), inclusive. Notwithstanding Section 16305.7 of the Government Code, the fund shall contain all interest and dividends earned on moneys in the fund.

(2)Notwithstanding Section 13340 of the Government Code, the fund shall be continuously appropriated without regard to fiscal year to the department for making quality and accountability payments, in accordance with subdivision (m), to facilities that meet or exceed predefined measures as established by this section.

(3)Upon appropriation by the Legislature, moneys in the fund may also be used for any of the following purposes:

(A)To cover the administrative costs incurred by the State Department of Public Health for positions and contract funding required to implement this section.

(B)To cover the administrative costs incurred by the State Department of Health Care Services for positions and contract funding required to implement this section.

(C)To provide funding assistance for the Long-Term Care Ombudsman Program activities pursuant to Chapter 11 (commencing with Section 9700) of Division 8.5.

(c)No appropriation associated with this bill is intended to implement the provisions of Section 1276.65 of the Health and Safety Code.

(d)(1)There is hereby appropriated for the 201011 fiscal year, one million nine hundred thousand dollars ($1,900,000) from the Skilled Nursing Facility Quality and Accountability Special Fund to the California Department of Aging for the Long-Term Care Ombudsman Program activities pursuant to Chapter 11 (commencing with Section 9700) of Division 8.5. It is the intent of the Legislature for the one million nine hundred thousand dollars ($1,900,000) from the fund to be in addition to the four million one hundred sixty-eight thousand dollars ($4,168,000) proposed in the Governors May Revision for the 201011 Budget. It is further the intent of the Legislature to increase this level of appropriation in subsequent years to provide support sufficient to carry out the mandates and activities pursuant to Chapter 11 (commencing with Section 9700) of Division 8.5.

(2)The department, in partnership with the California Department of Aging, shall seek approval from the federal Centers for Medicare and Medicaid Services to obtain federal Medicaid reimbursement for activities conducted by the Long-Term Care Ombudsman Program. The department shall report to the fiscal committees of the Legislature during budget hearings on progress being made and any unresolved issues during the 201112 budget deliberations.

(e)There is hereby created in the Special Deposit Fund established pursuant to Section 16370 of the Government Code, the Skilled Nursing Facility Minimum Staffing Penalty Account. The account shall contain all moneys deposited pursuant to subdivision (f).

(f)(1)Beginning with the 201011 fiscal year, the State Department of Public Health shall use the direct care staffing level data it collects to determine whether a skilled nursing facility has met the nursing direct care service hours per patient per day requirements pursuant to Section 1276.5 of the Health and Safety Code.

(2)(A)Beginning with the 201011 fiscal year, the State Department of Public Health shall assess a skilled nursing facility, licensed pursuant to subdivision (c) of Section 1250 of the Health and Safety Code, an administrative penalty if the State Department of Public Health determines that the skilled nursing facility fails to meet the nursing direct care service hours per patient per day requirements pursuant to Section 1276.5 of the Health and Safety Code as follows:

(i)Fifteen thousand dollars ($15,000) if the facility fails to meet the requirements for 5 percent or more of the audited days up to 49 percent.

(ii)Thirty thousand dollars ($30,000) if the facility fails to meet the requirements for over 49 percent or more of the audited days.

(B)(i)If the skilled nursing facility does not dispute the determination or assessment, the penalties shall be paid in full by the licensee to the State Department of Public Health within 30 days of the facilitys receipt of the notice of penalty and deposited into the Skilled Nursing Facility Minimum Staffing Penalty Account.

(ii)The State Department of Public Health may, upon written notification to the licensee, request that the department offset any moneys owed to the licensee by the Medi-Cal program or any other payment program administered by the department to recoup the penalty provided for in this section.

(C)(i)If a facility disputes the determination or assessment made pursuant to this paragraph, the facility shall, within 15 days of the facilitys receipt of the determination and assessment, simultaneously submit a request for appeal to both the department and the State Department of Public Health. The request shall include a detailed statement describing the reason for appeal and include all supporting documents the facility will present at the hearing.

(ii)Within 10 days of the State Department of Public Healths receipt of the facilitys request for appeal, the State Department of Public Health shall submit, to both the facility and the department, all supporting documents that will be presented at the hearing.

(D)The department shall hear a timely appeal and issue a decision as follows:

(i)The hearing shall commence within 60 days from the date of receipt by the department of the facilitys timely request for appeal.

(ii)The department shall issue a decision within 120 days from the date of receipt by the department of the facilitys timely request for appeal.

(iii)The decision of the departments hearing officer, when issued, shall be the final decision of the State Department of Public Health.

(E)The appeals process set forth in this paragraph shall be exempt from Chapter 4.5 (commencing with Section 11400) and Chapter 5 (commencing with Section 11500), of Part 1 of Division 3 of Title 2 of the Government Code. The provisions of Section 100171 and 131071 of the Health and Safety Code shall not apply to appeals under this paragraph.

(F)If a hearing decision issued pursuant to subparagraph (D) is in favor of the State Department of Public Health, the skilled nursing facility shall pay the penalties to the State Department of Public Health within 30 days of the facilitys receipt of the decision. The penalties collected shall be deposited into the Skilled Nursing Facility Minimum Staffing Penalty Account.

(G)The assessment of a penalty under this subdivision does not supplant the State Department of Public Healths investigation process or issuance of deficiencies or citations under Chapter 2.4 (commencing with Section 1417) of Division 2 of the Health and Safety Code.

(g)The State Department of Public Health shall transfer, on a monthly basis, all penalty payments collected pursuant to subdivision (f) into the Skilled Nursing Facility Quality and Accountability Special Fund.

(h)Nothing in this section shall impact the effectiveness or utilization of Section 1278.5 or 1432 of the Health and Safety Code relating to whistleblower protections, or Section 1420 of the Health and Safety Code relating to complaints.

(i)(1)Beginning in the 201011 fiscal year, the department, in consultation with representatives from the long-term care industry, organized labor, and consumers, shall establish and publish quality and accountability measures, benchmarks, and data submission deadlines by November 30, 2010.

(2)The methodology developed pursuant to this section shall include, but not be limited to, the following requirements and performance measures:

(A)Beginning in the 201112 fiscal year:

(i)Immunization rates.

(ii)Facility acquired pressure ulcer incidence.

(iii)The use of physical restraints.

(iv)Compliance with the nursing direct care service hours per patient per day requirements pursuant to Section 1276.5 of the Health and Safety Code.

(v)Resident and family satisfaction.

(vi)Direct care staff retention, if sufficient data is available.

(B)Beginning in the 201617 fiscal year, compliance with the certified nursing assistant staff-to-patient ratio requirements direct care service hour requirements for skilled nursing facilities established pursuant to Section 1276.65 of the Health and Safety Code. Code and Section 14110.7.

(C)If this act is extended beyond the dates on which it becomes inoperative and is repealed, in accordance with Section 14126.033, the department, in consultation with representatives from the long-term care industry, organized labor, and consumers, beginning in the 201314 rate year, shall incorporate additional measures into the system, including, but not limited to, quality and accountability measures required by federal health care reform that are identified by the federal Centers for Medicare and Medicaid Services.

(D)The department, in consultation with representatives from the long-term care industry, organized labor, and consumers, may incorporate additional performance measures, including, but not limited to, the following:

(i)Compliance with state policy associated with the United States Supreme Court decision in Olmstead v. L.C. ex rel. Zimring (1999) 527 U.S. 581.

(ii)Direct care staff retention, if not addressed in the 201213 rate year.

(iii)The use of chemical restraints.

(j) (1) Beginning with the 201011 rate year, and pursuant to subparagraph (B) of paragraph (5) of subdivision (a) of Section 14126.023, the department shall set aside savings achieved from setting the professional liability insurance cost category, including any insurance deductible costs paid by the facility, at the 75th percentile. From this amount, the department shall transfer the General Fund portion into the Skilled Nursing Facility Quality and Accountability Special Fund. A skilled nursing facility shall provide supplemental data on insurance deductible costs to facilitate this adjustment, in the format and by the deadlines determined by the department. If this data is not provided, a facilitys insurance deductible costs will remain in the administrative costs category.

(2)Notwithstanding paragraph (1), for the 201213 rate year only, savings from capping the professional liability insurance cost category pursuant to paragraph (1) shall remain in the General Fund and shall not be transferred to the Skilled Nursing Facility Quality and Accountability Special Fund.

(k)Beginning with the 201314 rate year, if there is a rate increase in the weighted average Medi-Cal reimbursement rate, the department shall set aside the first 1 percent of the weighted average Medi-Cal reimbursement rate increase for the Skilled Nursing Facility Quality and Accountability Special Fund.

(l)If this act is extended beyond the dates on which it becomes inoperative and is repealed, in accordance with Section 14126.033, beginning with the 201415 rate year, in addition to the amount set aside pursuant to subdivision (k), if there is a rate increase in the weighted average Medi-Cal reimbursement rate, the department shall set aside at least one-third of the weighted average Medi-Cal reimbursement rate increase, up to a maximum of 1 percent, from which the department shall transfer the General Fund portion of this amount into the Skilled Nursing Facility Quality and Accountability Special Fund.

(m)(1) (A) Beginning with the 201314 rate year, the department shall pay a supplemental payment, by April 30, 2014, to skilled nursing facilities based on all of the criteria in subdivision (i), as published by the department, and according to performance measure benchmarks determined by the department in consultation with stakeholders.

(B)(i)The department may convene a diverse stakeholder group, including, but not limited to, representatives from consumer groups and organizations, labor, nursing home providers, advocacy organizations involved with the aging community, staff from the Legislature, and other interested parties, to discuss and analyze alternative mechanisms to implement the quality and accountability payments provided to nursing homes for reimbursement.

(ii)The department shall articulate in a report to the fiscal and appropriate policy committees of the Legislature the implementation of an alternative mechanism as described in clause (i) at least 90 days prior to any policy or budgetary changes, and seek subsequent legislation in order to enact the proposed changes.

(2)Skilled nursing facilities that do not submit required performance data by the departments specified data submission deadlines pursuant to subdivision (i) shall not be eligible to receive supplemental payments.

(3)Notwithstanding paragraph (1), if a facility appeals the performance measure of compliance with the nursing direct care service hours per patient per day requirements, pursuant to Section 1276.5 of the Health and Safety Code, to the State Department of Public Health, and it is unresolved by the departments published due date, the department shall not use that performance measure when determining the facilitys supplemental payment.

(4)Notwithstanding paragraph (1), if the department is unable to pay the supplemental payments by April 30, 2014, then on May 1, 2014, the department shall use the funds available in the Skilled Nursing Facility Quality and Accountability Special Fund as a result of savings identified in subdivisions (k) and (l), less the administrative costs required to implement subparagraphs (A) and (B) of paragraph (3) of subdivision (b), in addition to any Medicaid funds that are available as of December 31, 2013, to increase provider rates retroactively to August 1, 2013.

(n)The department shall seek necessary approvals from the federal Centers for Medicare and Medicaid Services to implement this section. The department shall implement this section only in a manner that is consistent with federal Medicaid law and regulations, and only to the extent that approval is obtained from the federal Centers for Medicare and Medicaid Services and federal financial participation is available.

(o)In implementing this section, the department and the State Department of Public Health may contract as necessary, with Californias Medicare Quality Improvement Organization, or other entities deemed qualified by the department or the State Department of Public Health, not associated with a skilled nursing facility, to assist with development, collection, analysis, and reporting of the performance data pursuant to subdivision (i), and with demonstrated expertise in long-term care quality, data collection or analysis, and accountability performance measurement models pursuant to subdivision (i). This subdivision establishes an accelerated process for issuing any contract pursuant to this section. Any contract entered into pursuant to this subdivision shall be exempt from the requirements of the Public Contract Code, through December 31, 2013.

(p)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the following shall apply:

(1)The director shall implement this section, in whole or in part, by means of provider bulletins, or other similar instructions without taking regulatory action.

(2)The State Public Health Officer may implement this section by means of all facility letters, or other similar instructions without taking regulatory action.

(q)Notwithstanding paragraph (1) of subdivision (m), if a final judicial determination is made by any state or federal court that is not appealed, in any action by any party, or a final determination is made by the administrator of the federal Centers for Medicare and Medicaid Services, that any payments pursuant to subdivisions (a) and (m), are invalid, unlawful, or contrary to any provision of federal law or regulations, or of state law, these subdivisions shall become inoperative, and for the 201112 rate year, the rate increase provided under subparagraph (A) of paragraph (4) of subdivision (c) of Section 14126.033 shall be reduced by the amounts described in subdivision (j). For the 201314 rate year, and for each subsequent rate year, any rate increase shall be reduced by the amounts described in subdivisions (j) to (l), inclusive.

(a)For purposes of this section, the following definitions shall apply:

(1)Direct caregiver means a registered nurse, as referred to in Section 2732 of the Business and Professions Code, a licensed vocational nurse, as referred to in Section 2864 of the Business and Professions Code, a psychiatric technician, as referred to in Section 4516 of the Business and Professions Code, and a certified nurse assistant, as defined in Section 1337.

(2)Skilled nursing facility means a skilled nursing facility as defined in subdivision (c) of Section 1250.

(b)A person employed to provide services such as food preparation, housekeeping, laundry, or maintenance services shall not provide nursing care to residents and shall not be counted in determining ratios under this section.

(c)(1)(A)Notwithstanding any other provision of law, the State Department of Health Services Public Health shall develop regulations that become effective August 1, 2003, June 1, 2016, that establish staff-to-patient ratios for direct caregivers working in a skilled nursing facility. These ratios shall include separate licensed nurse staff-to-patient ratios and certified nurse assistant staff-to-patient ratios, in addition to the ratios established for other direct caregivers.

(2)The department, in developing staff-to-patient ratios for direct caregivers caregivers, certified nurse assistants, and licensed nurses required by this section, shall convert the existing requirement under Section 1276.5 of this code and Section 14110.7 of the Welfare and Institutions Code for 3.2 nursing hours per patient day of care and shall ensure that no less care is given than is required pursuant to Section 1276.5 of this code and Section 14110.7 of the Welfare and Institutions Code. Further, the department shall develop the ratios in a manner that minimizes additional state costs, maximizes resident access to care, and takes into account the length of the shift worked. In developing the regulations, the department shall develop a procedure for facilities to apply for a waiver that addresses individual patient needs except that in no instance shall the minimum staff-to-patient ratios be less than the 3.2 nursing hours per patient day required under Section 1276.5 of this code and Section 14110.7 of the Welfare and Institutions Code.

(d)The staffing ratios to be developed pursuant to this section shall be minimum standards only. Skilled nursing facilities shall employ and schedule additional staff as needed to ensure quality resident care based on the needs of individual residents and to ensure compliance with all relevant state and federal staffing requirements.

(e)No later than January 1, 2006, and every five years thereafter, the department shall consult with consumers, consumer advocates, recognized collective bargaining agents, and providers to determine the sufficiency of the staffing standards provided in this section and may adopt regulations to increase the minimum staffing ratios to adequate levels.

(f)(1)In a manner pursuant to federal requirements, effective January 1, 2003, every skilled nursing facility shall post information about staffing levels that includes the current number of licensed and unlicensed nursing staff directly responsible for resident care in the facility. This posting shall include staffing requirements developed pursuant to this section. section and an accurate report of the number of staff working each shift. The information shall be posted on paper that is at least 8.5 inches by 14 inches and shall be printed in a font of at least 16 point.

(g)(1)Notwithstanding any other provision of law, the department shall inspect for compliance with this section during state and federal periodic inspections, including, but not limited to, those inspections required under Section 1422. This inspection requirement shall not limit the departments authority in other circumstances to cite for violations of this section or to inspect for compliance with this section.

(2)A violation of the regulations developed pursuant to this section may constitute a class B, A, or AA violation pursuant to the standards set forth in Section 1424.

(h)The requirements of this section are in addition to any requirement set forth in Section 1276.5 of this code and Section 14110.7 of the Welfare and Institutions Code.

(i)Initial implementation of the staffing ratio developed pursuant to requirements set forth in this section shall be contingent on an appropriation in the annual Budget Act or another statute.

(j)In implementing this section, the department may contract as necessary, on a bid or nonbid basis, for professional consulting services from nationally recognized higher education and research institutions, or other qualified individuals and entities not associated with a skilled nursing facility, with demonstrated expertise in long-term care. This subdivision establishes an accelerated process for issuing contracts pursuant to this section and contracts entered into pursuant to this section shall be exempt from the requirements of Chapter 1 (commencing with Section 10100) and Chapter 2 (commencing with Section 10290) of Part 2 of Division 2 of the Public Contract Code.

(k)This section shall not apply to facilities defined in Section 1276.9.

(a)(1)By August 1, 2011, the department shall develop the Skilled Nursing Facility Quality and Accountability Supplemental Payment System, subject to approval by the federal Centers for Medicare and Medicaid Services, and the availability of federal, state, or other funds.

(2)(A)The system shall be utilized to provide supplemental payments to skilled nursing facilities that improve the quality and accountability of care rendered to residents in skilled nursing facilities, as defined in subdivision (c) of Section 1250 of the Health and Safety Code, and to penalize those facilities that do not meet measurable standards.

(B)A freestanding pediatric subacute care facility, as defined in Section 51215.8 of Title 22 of the California Code of Regulations, shall be exempt from the Skilled Nursing Facility Quality and Accountability Supplemental Payment System.

(3)The system shall be phased in, beginning with the 201011 rate year.

(4)The department may utilize the system to do all of the following:

(A)Assess overall facility quality of care and quality of care improvement, and assign quality and accountability payments to skilled nursing facilities pursuant to performance measures described in subdivision (i).

(B)Assign quality and accountability payments or penalties relating to quality of care, or direct care staffing levels, wages, and benefits, or both.

(C)Limit the reimbursement of legal fees incurred by skilled nursing facilities engaged in the defense of governmental legal actions filed against the facilities.

(D)Publish each facilitys quality assessment and quality and accountability payments in a manner and form determined by the director, or his or her designee.

(E)Beginning with the 201112 fiscal year, establish a base year to collect performance measures described in subdivision (i).

(F)Beginning with the 201112 fiscal year, in coordination with the State Department of Public Health, publish the direct care staffing level data and the performance measures required pursuant to subdivision (i).

(b)(1)There is hereby created in the State Treasury, the Skilled Nursing Facility Quality and Accountability Special Fund. The fund shall contain moneys deposited pursuant to subdivisions (g) and (j) to (l), inclusive. Notwithstanding Section 16305.7 of the Government Code, the fund shall contain all interest and dividends earned on moneys in the fund.

(2)Notwithstanding Section 13340 of the Government Code, the fund shall be continuously appropriated without regard to fiscal year to the department for making quality and accountability payments, in accordance with subdivision (m), to facilities that meet or exceed predefined measures as established by this section.

(3)Upon appropriation by the Legislature, moneys in the fund may also be used for any of the following purposes:

(A)To cover the administrative costs incurred by the State Department of Public Health for positions and contract funding required to implement this section.

(B)To cover the administrative costs incurred by the State Department of Health Care Services for positions and contract funding required to implement this section.

(C)To provide funding assistance for the Long-Term Care Ombudsman Program activities pursuant to Chapter 11 (commencing with Section 9700) of Division 8.5.

(c)No appropriation associated with this bill is intended to implement the provisions of Section 1276.65 of the Health and Safety Code.

(d)(1)There is hereby appropriated for the 201011 fiscal year, one million nine hundred thousand dollars ($1,900,000) from the Skilled Nursing Facility Quality and Accountability Special Fund to the California Department of Aging for the Long-Term Care Ombudsman Program activities pursuant to Chapter 11 (commencing with Section 9700) of Division 8.5. It is the intent of the Legislature for the one million nine hundred thousand dollars ($1,900,000) from the fund to be in addition to the four million one hundred sixty-eight thousand dollars ($4,168,000) proposed in the Governors May Revision for the 201011 Budget. It is further the intent of the Legislature to increase this level of appropriation in subsequent years to provide support sufficient to carry out the mandates and activities pursuant to Chapter 11 (commencing with Section 9700) of Division 8.5.

(2)The department, in partnership with the California Department of Aging, shall seek approval from the federal Centers for Medicare and Medicaid Services to obtain federal Medicaid reimbursement for activities conducted by the Long-Term Care Ombudsman Program. The department shall report to the fiscal committees of the Legislature during budget hearings on progress being made and any unresolved issues during the 201112 budget deliberations.

(e)There is hereby created in the Special Deposit Fund established pursuant to Section 16370 of the Government Code, the Skilled Nursing Facility Minimum Staffing Penalty Account. The account shall contain all moneys deposited pursuant to subdivision (f).

(f)(1)Beginning with the 201011 fiscal year, the State Department of Public Health shall use the direct care staffing level data it collects to determine whether a skilled nursing facility has met the nursing hours per patient per day requirements pursuant to Section 1276.5 of the Health and Safety Code.

(2)(A)Beginning with the 201011 fiscal year, the State Department of Public Health shall assess a skilled nursing facility, licensed pursuant to subdivision (c) of Section 1250 of the Health and Safety Code, an administrative penalty if the State Department of Public Health determines that the skilled nursing facility fails to meet the nursing hours per patient per day requirements pursuant to Section 1276.5 of the Health and Safety Code as follows:

(i)Fifteen thousand dollars ($15,000) if the facility fails to meet the requirements for 5 percent or more of the audited days up to 49 percent.

(ii)Thirty thousand dollars ($30,000) if the facility fails to meet the requirements for over 49 percent or more of the audited days.

(B)(i)If the skilled nursing facility does not dispute the determination or assessment, the penalties shall be paid in full by the licensee to the State Department of Public Health within 30 days of the facilitys receipt of the notice of penalty and deposited into the Skilled Nursing Facility Minimum Staffing Penalty Account.

(ii)The State Department of Public Health may, upon written notification to the licensee, request that the department offset any moneys owed to the licensee by the Medi-Cal program or any other payment program administered by the department to recoup the penalty provided for in this section.

(C)(i)If a facility disputes the determination or assessment made pursuant to this paragraph, the facility shall, within 15 days of the facilitys receipt of the determination and assessment, simultaneously submit a request for appeal to both the department and the State Department of Public Health. The request shall include a detailed statement describing the reason for appeal and include all supporting documents the facility will present at the hearing.

(ii)Within 10 days of the State Department of Public Healths receipt of the facilitys request for appeal, the State Department of Public Health shall submit, to both the facility and the department, all supporting documents that will be presented at the hearing.

(D)The department shall hear a timely appeal and issue a decision as follows:

(i)The hearing shall commence within 60 days from the date of receipt by the department of the facilitys timely request for appeal.

(ii)The department shall issue a decision within 120 days from the date of receipt by the department of the facilitys timely request for appeal.

(iii)The decision of the departments hearing officer, when issued, shall be the final decision of the State Department of Public Health.

(E)The appeals process set forth in this paragraph shall be exempt from Chapter 4.5 (commencing with Section 11400) and Chapter 5 (commencing with Section 11500), of Part 1 of Division 3 of Title 2 of the Government Code. The provisions of Section 100171 and 131071 of the Health and Safety Code shall not apply to appeals under this paragraph.

(F)If a hearing decision issued pursuant to subparagraph (D) is in favor of the State Department of Public Health, the skilled nursing facility shall pay the penalties to the State Department of Public Health within 30 days of the facilitys receipt of the decision. The penalties collected shall be deposited into the Skilled Nursing Facility Minimum Staffing Penalty Account.

(G)The assessment of a penalty under this subdivision does not supplant the State Department of Public Healths investigation process or issuance of deficiencies or citations under Chapter 2.4 (commencing with Section 1417) of Division 2 of the Health and Safety Code.

(g)The State Department of Public Health shall transfer, on a monthly basis, all penalty payments collected pursuant to subdivision (f) into the Skilled Nursing Facility Quality and Accountability Special Fund.

(h)Nothing in this section shall impact the effectiveness or utilization of Section 1278.5 or 1432 of the Health and Safety Code relating to whistleblower protections, or Section 1420 of the Health and Safety Code relating to complaints.

(i)(1)Beginning in the 201011 fiscal year, the department, in consultation with representatives from the long-term care industry, organized labor, and consumers, shall establish and publish quality and accountability measures, benchmarks, and data submission deadlines by November 30, 2010.

(2)The methodology developed pursuant to this section shall include, but not be limited to, the following requirements and performance measures:

(A)Beginning in the 201112 fiscal year:

(i)Immunization rates.

(ii)Facility acquired pressure ulcer incidence.

(iii)The use of physical restraints.

(iv)Compliance with the nursing hours per patient per day requirements pursuant to Section 1276.5 of the Health and Safety Code.

(v)Resident and family satisfaction.

(vi)Direct care staff retention, if sufficient data is available.

(C)If this act is extended beyond the dates on which it becomes inoperative and is repealed, in accordance with Section 14126.033, the department, in consultation with representatives from the long-term care industry, organized labor, and consumers, beginning in the 201314 rate year, shall incorporate additional measures into the system, including, but not limited to, quality and accountability measures required by federal health care reform that are identified by the federal Centers for Medicare and Medicaid Services.

(D)The department, in consultation with representatives from the long-term care industry, organized labor, and consumers, may incorporate additional performance measures, including, but not limited to, the following:

(i)Compliance with state policy associated with the United States Supreme Court decision in Olmstead v. L.C. ex rel. Zimring (1999) 527 U.S. 581.

(ii)Direct care staff retention, if not addressed in the 201213 rate year.

(iii)The use of chemical restraints.

(j) (1) Beginning with the 201011 rate year, and pursuant to subparagraph (B) of paragraph (5) of subdivision (a) of Section 14126.023, the department shall set aside savings achieved from setting the professional liability insurance cost category, including any insurance deductible costs paid by the facility, at the 75th percentile. From this amount, the department shall transfer the General Fund portion into the Skilled Nursing Facility Quality and Accountability Special Fund. A skilled nursing facility shall provide supplemental data on insurance deductible costs to facilitate this adjustment, in the format and by the deadlines determined by the department. If this data is not provided, a facilitys insurance deductible costs will remain in the administrative costs category.

(2)Notwithstanding paragraph (1), for the 201213 rate year only, savings from capping the professional liability insurance cost category pursuant to paragraph (1) shall remain in the General Fund and shall not be transferred to the Skilled Nursing Facility Quality and Accountability Special Fund.

(k)Beginning with the 201314 rate year, if there is a rate increase in the weighted average Medi-Cal reimbursement rate, the department shall set aside the first 1 percent of the weighted average Medi-Cal reimbursement rate increase for the Skilled Nursing Facility Quality and Accountability Special Fund.

(l)If this act is extended beyond the dates on which it becomes inoperative and is repealed, in accordance with Section 14126.033, beginning with the 201415 rate year, in addition to the amount set aside pursuant to subdivision (k), if there is a rate increase in the weighted average Medi-Cal reimbursement rate, the department shall set aside at least one-third of the weighted average Medi-Cal reimbursement rate increase, up to a maximum of 1 percent, from which the department shall transfer the General Fund portion of this amount into the Skilled Nursing Facility Quality and Accountability Special Fund.

(m)(1) (A) Beginning with the 201314 rate year, the department shall pay a supplemental payment, by April 30, 2014, to skilled nursing facilities based on all of the criteria in subdivision (i), as published by the department, and according to performance measure benchmarks determined by the department in consultation with stakeholders.

(B)(i)The department may convene a diverse stakeholder group, including, but not limited to, representatives from consumer groups and organizations, labor, nursing home providers, advocacy organizations involved with the aging community, staff from the Legislature, and other interested parties, to discuss and analyze alternative mechanisms to implement the quality and accountability payments provided to nursing homes for reimbursement.

(ii)The department shall articulate in a report to the fiscal and appropriate policy committees of the Legislature the implementation of an alternative mechanism as described in clause (i) at least 90 days prior to any policy or budgetary changes, and seek subsequent legislation in order to enact the proposed changes.

(2)Skilled nursing facilities that do not submit required performance data by the departments specified data submission deadlines pursuant to subdivision (i) shall not be eligible to receive supplemental payments.

(3)Notwithstanding paragraph (1), if a facility appeals the performance measure of compliance with the nursing hours per patient per day requirements, pursuant to Section 1276.5 of the Health and Safety Code, to the State Department of Public Health, and it is unresolved by the departments published due date, the department shall not use that performance measure when determining the facilitys supplemental payment.

(4)Notwithstanding paragraph (1), if the department is unable to pay the supplemental payments by April 30, 2014, then on May 1, 2014, the department shall use the funds available in the Skilled Nursing Facility Quality and Accountability Special Fund as a result of savings identified in subdivisions (k) and (l), less the administrative costs required to implement subparagraphs (A) and (B) of paragraph (3) of subdivision (b), in addition to any Medicaid funds that are available as of December 31, 2013, to increase provider rates retroactively to August 1, 2013.

(n)The department shall seek necessary approvals from the federal Centers for Medicare and Medicaid Services to implement this section. The department shall implement this section only in a manner that is consistent with federal Medicaid law and regulations, and only to the extent that approval is obtained from the federal Centers for Medicare and Medicaid Services and federal financial participation is available.

(o)In implementing this section, the department and the State Department of Public Health may contract as necessary, with Californias Medicare Quality Improvement Organization, or other entities deemed qualified by the department or the State Department of Public Health, not associated with a skilled nursing facility, to assist with development, collection, analysis, and reporting of the performance data pursuant to subdivision (i), and with demonstrated expertise in long-term care quality, data collection or analysis, and accountability performance measurement models pursuant to subdivision (i). This subdivision establishes an accelerated process for issuing any contract pursuant to this section. Any contract entered into pursuant to this subdivision shall be exempt from the requirements of the Public Contract Code, through December 31, 2013.

(p)Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, the following shall apply:

(1)The director shall implement this section, in whole or in part, by means of provider bulletins, or other similar instructions without taking regulatory action.

(2)The State Public Health Officer may implement this section by means of all facility letters, or other similar instructions without taking regulatory action.

(q)Notwithstanding paragraph (1) of subdivision (m), if a final judicial determination is made by any state or federal court that is not appealed, in any action by any party, or a final determination is made by the administrator of the federal Centers for Medicare and Medicaid Services, that any payments pursuant to subdivisions (a) and (m), are invalid, unlawful, or contrary to any provision of federal law or regulations, or of state law, these subdivisions shall become inoperative, and for the 201112 rate year, the rate increase provided under subparagraph (A) of paragraph (4) of subdivision (c) of Section 14126.033 shall be reduced by the amounts described in subdivision (j). For the 201314 rate year, and for each subsequent rate year, any rate increase shall be reduced by the amounts described in subdivisions (j) to (l), inclusive.