SB 648: Health and care facilities: private referral agencies.

Existing law defines a placement agency as a local governmental agency, a general acute care hospital, a conservator, a regional center, or a private entity receiving public funds that is engaged in finding homes or other places for placement of specified persons, including placement in an adult residential facility, residential care facility for persons with chronic life-threatening illness, or residential care facility for the elderly. Existing law requires an employee of a placement agency who knows, or reasonably suspects, that a facility that is not exempt from licensing requirements is operating without a license to report the name and address of the facility to the State Department of Social Services. Failure to report the facility is punishable as a misdemeanor.

This bill would expand the definition of placement agencies to include private referral agencies that refer persons for remuneration to an adult residential facility, a residential care facility for persons with chronic life-threatening illness, or a residential care facility for the elderly. Because the bill would expand the requirements imposed on a placement agency to apply to a private referral agency, the violation of which would be a crime, this bill would impose a state-mandated local program. The bill would also require the aforementioned facilities to provide a resident with a disclosure statement before an admission agreement is signed if the services of a private referral agency are used. used and the facility licensee knows the private referral agency was used and has a long-term agreement or contract with the private referral agency. The bill would authorize the State Department of Social Services to assess a civil penalty in the amount the facility paid to the private referral agency penalty, as specified, if the facility fails to provide the disclosure.

The bill would prohibit a private referral agency or its employees from holding any power of attorney for a person receiving placement referral services or to receive or hold that persons property in any capacity. The bill would require, commencing July 1, 2018, a private referral agency to maintain liability insurance in specified amounts. The bill would make it unlawful for an employee, independent contractor, or other person who is acting on behalf of a government agency, hospital, or other health care institution to offer, provide, or accept a payment, rebate, refund, commission, preference, or discount as payment, compensation, or inducement for referring patients, clients, or customers to an adult residential facility, residential care facility for persons with chronic life-threatening illness, or residential care facility for the elderly, or private referral agency.

The bill would require the State Department of Social Services to keep track of any consumer complaints arising from consumer interactions with private referral agencies and would authorize the department to levy civil penalties, as specified. The bill would prohibit a private referral agency from disclosing any personal information of a person receiving services unless authorized to do so and would require a private referral agency to retain, for no less than 3 years, an acknowledgment from the person being referred, or his or her conservator, guardian, authorized family member or other authorized representative, attorney in fact, or agent under a power of attorney, stating that the authorization had been made. The bill would require a private referral agency to conduct a suitability determination of each person who seeks a referral and is referred to an adult residential facility, residential care facility for persons with chronic life-threatening illness, or residential care facility for the elderly. The bill would require a private referral agency to train its employees who make referrals to an adult residential facility, residential care facility for persons with chronic life-threatening illness, or residential care facility for the elderly, as specified.

The bill would also require the State Department of Social Services to, no later than January 1, 2023, submit a report on the effectiveness of existing statutory remedies related to private referral agencies to the Legislature, as specified. The bill would require the report to include an evaluation of whether further regulation of private referral agencies is needed and would require the department to work with stakeholders and consider consumer complaints, previous actions, and any other applicable documents or reports when conducting its evaluation.

Existing law makes specified persons mandated reporters of elder or dependent adult abuse, including administrators, supervisors, and licensed staff of a facility that provide care or services for elder or dependent adults. Under existing law, failure to report physical abuse, abandonment, abduction, isolation, financial abuse, or neglect of an elder or dependent adult is a misdemeanor.

The bill would include on the list of mandated reporters owners, operators, and employees of a specified private referral agency. By expanding the crime of failure to report elder or dependent adult abuse, this 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.