BILL ANALYSIS Ó AB 261 Page 1 Date of Hearing: April 2, 2013 ASSEMBLY COMMITTEE ON HUMAN SERVICES Mark Stone, Chair AB 261 (Chesbro) - As Amended: April 1, 2013 SUBJECT : Residential care facilities for the elderly: fees and charges SUMMARY : Provides clarification on the termination of an admission agreement and the charging of fees when a residential care facility for the elderly (RCFE) resident passes away. Specifically, this bill : 1)Prohibits a RCFE from requiring advance notice for the termination of an admission agreement upon the death of a resident. 2)Requires a RCFE to cease charging fees when all personal property of a deceased resident is removed from the living unit. 3)Prohibits a RCFE from impeding the removal of a deceased resident's belongings by the resident's authorized representative(s). 4)Requires a RCFE to issue a refund of any fees paid in advance that cover time after the deceased resident's belongings have been removed from the facility to the resident's authorized representative(s) within 15 days of removal of the belongings. 5)Requires a RCFE licensee to provide a deceased resident's representative written notice regarding contract termination upon death and refunds within three days of becoming aware of the resident's death if fees are assessed while a deceased resident's belongings remain in the facility. EXISTING LAW 1)Establishes the California Community Care Facilities Act (CCFA) to provide a comprehensive statewide service system of quality community care for people who have a mental illness, a developmental or physical disability, and children and adults who require care or services from a facility or organization. AB 261 Page 2 2)Defines a "Community care facility" (CCF) as a facility, place, or building maintained and operated to provide nonmedical residential care, day treatment, adult day care, or foster family agency services for children, adults, or children and adults, including, but not limited to, the physically handicapped, mentally impaired, incompetent persons, and abused or neglected children. 3)Establishes the California RCFE Act, which requires facilities that provide personal care and supervision, protective supervision or health related services for persons 60 years of age or older who voluntarily choose to reside in that facility to be licensed by the California Department of Social Services (DSS). 4)Prohibits any person, firm, partnership, association, corporation or public agency from establishing, operating, managing, conducting or maintaining a CCF or a RCFE without a valid license provided by DSS. 5)Provides that any person who violates the CCFA or the RCFE Act shall be guilty of a misdemeanor and upon conviction be fined no more than $1,000, imprisoned in county jail for up to one year, or both. 6)Requires RCFE administrators and staff to meet specified professional development and training requirements in order to be certified to operate or work in a RCFE. 7)Requires an "admission agreement" to include all documents that a resident or his or her representative must sign at the time of, or as a condition of admission to a RCFE. 8)Requires an admission agreement to include a breakdown of items and services provided, a comprehensive description of the RCFE's fee schedule, its refund policy, the conditions under which the admission agreement may be terminated, and other requirements, as specified. FISCAL EFFECT : Unknown COMMENTS : Background It is the intent of the Legislature, in creating RCFEs as its AB 261 Page 3 own separate licensing category under the RCFE Act, to help provide a system of residential care to allow older persons to remain as independent as possible while not forcing them to move between medical and nonmedical services. Commonly referred to as assisted living facilities, retirement homes and board and care homes, RCFEs are licensed facilities under the CCFA that provide services to individuals who are 60 years of age and over and persons under the age of 60 with compatible needs. RCFEs provide a wide array of care, which can include varying levels of personal care and protective supervision, based upon the needs of the resident. According to DSS, as of February 6, 2013 there are currently 7,613 licensed RCFEs in California with a capacity to serve 173,333 residents. Under the CCFA, RCFEs are required to provide each resident with an "admission agreement." An admission agreement generally refers to all documents that resident or his or her authorized representative must sign at the time of, or as a condition of, admission to the RCFE. Admission agreements are required to meet explicit and specific requirements as to what may and may not be included. In regards to termination of the admission agreement, current law provides for two methods of termination. The first is through the resident moving out of the facility voluntarily or involuntarily, i.e. eviction, and the other is through the death of the resident. Past Legislation Similar legislation, AB 1142 (Chesbro), was pursued during the 2011-12 Legislative Session to address a conflict between existing statute and regulations regarding how an admission agreement may be canceled when a resident passes away. As noted in this committee's analysis of AB 1142: The author points out that administrative regulations pertaining to RCFEs allow for admission agreements to include a 30-day cancellation notice. The RCFE regulations also provide that the agreement is "automatically terminated by the death of the resident, whose relatives shall not be liable for any payment beyond that due at the date of death, unless agreed to in writing or ordered by court." 22 CCR Section 87507(h). Although, the author notes, it appears to be an uncommon practice, some RCFEs AB 261 Page 4 apparently apply these regulations together to include provisions in admission agreements holding relatives responsible for payment of fees for 30 days, even after the death of the resident. According to the author, "the policy needs to be clarified to eliminate confusion or distress for residents and their families." Need for the bill AB 261 is a reintroduction of AB 1142 with similar intent but a simpler approach. Whereas AB 1142 introduced new terminology to the CCFA, AB 261 uses existing terminology and builds upon current law to address the conflict in the interpretation of how and when facility-related fees may be charged to a deceased resident's authorized representative(s). Writing in support of AB 261, the California Commission on Aging writes: By prohibiting the imposition of a 30-day termination notice when a resident dies, AB 261 protects families already traumatized by the death [of a family member] from unnecessary expenses. By requiring that fees stop once the personal property of the deceased resident has been removed from the resident's apartment, RCFE operators have some degree of leverage to have the residence vacated promptly, while assuring that families do not face ongoing fees once the room has been cleared. REGISTERED SUPPORT / OPPOSITION : Support Alzheimer's Association California Assisted Living Association (CALA) California Association for Health Services at Home (CAHSAH) California Commission on Aging California School Employees Association, AFL-CIO Community Residential Care Association of CA County Welfare Directors Association of California (CWDA) LeadingAge California Opposition None on file AB 261 Page 5 Analysis Prepared by : Chris Reefe / HUM. S. / (916) 319-2089