BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Kevin de Le�n, Chair
AB 1217 (Lowenthal) - Home Care Services Consumer Protection Act
of 2013.
Amended: August 12, 2013 Policy Vote: Human Services 4-2
Urgency: No Mandate: No
Hearing Date: August 30, 2013
Consultant: Jolie Onodera
SUSPENSE FILE.
Bill Summary: AB 1217 would establish the Home Care Services
Consumer Protection Act of 2013, to be established and
administered by the Department of Social Services (DSS), to
provide for the licensure and regulation of home care
organizations and the certification of home care aides.
Fiscal Impact:
One-time costs of approximately $22.5 million (General
Fund) to promulgate regulations, forms, automation changes
to create the new licensing system and development of
registries, inspections and licensing for 2,000 agencies,
and certification of over 101,000 home care aides. Ongoing
costs to be covered by licensure and certification fees from
the newly created Home Care Organization and Home Care Aide
Fund.
Estimated ongoing costs of approximately $20 million
(Special Fund*) to administer the licensure and
certification programs, to be fully offset by licensure and
certification fees. Assuming 60 percent of ongoing costs
would be attributable to licensure would result in a
licensure fee of $6,000 per agency and $80 certification fee
per home care aide.
Special fund** costs to the Department of Justice (DOJ) of
$280,000 in FY 2013-14, $400,000 in FY 2014-15, and $130,000
in FY 2015-16 and annually thereafter for workload
associated with additional background checks required of all
home care aides and home care organization licensees.
Minor ongoing administrative costs to the Secretary of
State (SOS) to the extent additional organizations register
to conduct business in California.
*Home Care Organization and Home Care Aide Fund (HCOHCA)
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**Fingerprint Fees Account
Background: Although existing law provides for the licensing and
regulation of individuals and organizations providing skilled
nursing services at a person's residence, non-medical in-home
personal care services are only regulated for publicly-funded
services programs such as the In-Home Supportive Services (IHSS)
program that provides personal care services to low-income aged,
blind, or disabled individuals. It is estimated there are
approximately 3,200 agencies that employ over 100,000 home care
aides in California that provide home care services that include
basic non-medical living assistance such as cooking, cleaning,
dressing, feeding, bathing, personal hygiene and grooming,
transportation, correspondence, shopping, and companionship.
As stated in the uncodified legislative findings and
declarations of this bill, "In California, most individuals
hiring a home care organization believe that the home care aide
entering their home has been thoroughly screened and trained.
However, a business license is the only requirement needed to
provide non-medical home care services in an individual's home.
Twenty-three states, including Texas, Illinois, Florida, and New
York, have standards requiring home care organizations to
register or obtain a license. Discharge planners commonly
maintain lists of home care aides and home care organizations
for purposes of patient referral without any information about
the individuals or the organizations, thereby placing both the
patient and the referring organization at risk."
Proposed Law: This bill would establish the Home Care Services
Consumer Protection Act of 2013 to provide for the licensure and
regulation of home care organizations (HCOs) and the
certification of home care aides. Specifically, this bill:
Specifies the DSS shall administer and regulate the program.
Defines "home care aide" as an individual who provides home
care services to a client in the client's residence, and is
synonymous with caregiver, custodial care, personal care
attendant, homemaker, and companion. In addition, "home care
aide" includes an individual who qualifies as a personal
attendant as defined in Industry Wage Order 15-2001, issued by
the Industrial Welfare Commission. Excludes a family member of
the person receiving home care services or a person employed
by or contracted with an organization vendored or contracted
through a regional center.
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Defines "home care organization" as an individual,
partnership, corporation, limited liability company, joint
venture, association, or any other entity that arranges for
the provision of home care services by a home care aide to a
client in a client's residence and is licensed. Excludes a
home health agency, hospice, health facility, county providing
IHSS, licensed home medical device retail facility, an
organization vendored or contracted through a regional center
or the Department of Developmental Services, as specified, or
an employment agency that refers home care aides or other
workers to clients but does not actually employ home care
aides, or a licensed residential care facility for the
elderly.
Provides that on and after July 1, 2014, all HCOs must be
licensed. Licensure is provided for a two-year term, subject
to the following requirements:
o Filing of an application and fees, as
specified.
o Proof of general and professional liability
insurance in the amount of at least $1 million per
occurrence and $3 million in aggregate.
o Proof of valid workers' compensation policy
covering its home care aides.
o Submittal of complete list of home care aides
and proof that each has met necessary requirements.
o HCO owner(s) passage of a background check
clearance, as specified.
Provides that employment agencies must submit annually proof
of general and professional liability insurance in the amounts
noted above.
Specifies that violations of the licensing and liability
insurance requirements are subject to a civil penalty of up to
$900 per day for each violation.
Provides that a HCO with its principal place of business out
of state must have an office in California and have registered
with the SOS to conduct business in California.
Authorizes the DSS to adopt regulations to implement this Act,
and establish procedures for the receipt, investigation, and
resolution of complaints against HCOs, as specified.
Authorizes the DSS to maintain a registry of certified home
care aides on its website, with the capability to look up
certification status, including the name and geographic
location of the home care aide's employer(s), as well as any
disciplinary action taken against the home care aide. In
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addition to the home care aide's name, certificate number, and
geographic location, the DSS may request and maintain
additional employment information which will not be publicly
available on the registry.
Authorizes the DSS to maintain a registry on its website of
the licensure status of HCOs, along with the name, address,
and telephone number of the HCO, and the status of any
completed disciplinary action against the HCO.
Requires any person hired as a home care aide on or after
January 1, 2015, to be certified before being hired. The term
of the certificate is two years and renewable upon application
and payment of the renewal fee as prescribed by the DSS.
Certification requirements include:
o A minimum of five hours of entry-level
training as approved by the DSS - two hours of
orientation training on the role as caregiver and
applicable terms of employment, three hours of safety
training including basic safety precautions, emergency
procedures, and infection control, and other training
related to core competencies, as specified.
o A background check clearance, as specified.
o Payment of the certification fee by the home
care aide.
o Submit to an examination to determine if he or
she is free of active tuberculosis.
On and after January 1, 2015, HCOs are prohibited from
hiring a home care aide unless the home care aide complies
with all of the following:
o Completes an individual interview.
o Provides at least two work or school-related
references or at least two character references from
non-relatives, subject to HCO verification.
o Demonstrates sufficient language skills to
read and understand instructions, prepare and maintain
written reports and records, and communicate with a
client.
o Provides proof of certification as a home care
aide.
o For home care aides hired prior to January
2015, delays the requirement for a certificate to July
1, 2015.
Requires the DSS to assess licensure and certification
fees in amounts to support the costs of each activity.
Except for General Fund moneys otherwise transferred or
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appropriated for the initial costs of administering this
Act, or penalties collected, specifies that no General Fund
shall be used for any purpose under this Act.
Creates the Home Care Organization and Home Care Aide
(HCOHCA) Fund, for the deposit of all licensure and
certification fees, to be available to the DSS upon
appropriation by the Legislature, for the purposes of
administering this Act.
Specifies that the licensure fee shall be equivalent to
the cost of administering the licensure program, and the
certification fee shall be equivalent to the cost of
administering the certification program, as defined by the
DSS.
Requires DSS to publish, commencing February 1, 2015,
and every February 1 thereafter, the fees estimated, both
on the DSS website and through submittal to the
Legislature, along with a report of all costs for home care
licensure and home care aide certification activities, as
specified.
Creates the Home Care Organization and Home Care Aide
Penalties Subaccount within the HCOHCA Fund, in which all
fines and penalties collected under the Act are deposited,
and are to be available to the DSS upon appropriation by
the Legislature for purposes of enforcing the Act.
Related Legislation: AB 322 (Yamada) 2013 would establish the
Home Care Services Act of 2013 to provide for the licensure and
regulation of home care organizations. This bill does not
require certification of home care aides, only licensing of home
care organizations and referral agencies that do not employ home
care aides. This bill was held on the Suspense File of the
Assembly Committee on Appropriations.
AB 899 (Yamada) 2011 was substantially similar to AB 322 noted
above and was held on the Suspense File of the Assembly
Committee on Appropriations.
SB 411 (Price) 2011 was substantially similar to this measure
but delegated regulatory oversight to the Department of Pubic
Health. This bill was vetoed by the Governor with the following
message:
I am returning Senate Bill 411 without my signature. This bill
would establish a new regulatory scheme for the private home
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care industry. I understand the argument for stronger oversight,
requiring home care agencies to be licensed and home care aides
to be certified. But given the economic stresses and
uncertainty, I am not prepared to embark upon the institutional
changes and costs that this bill entails.
AB 853 (Jones) 2007 was substantially similar to both AB 322 and
AB 899 (Yamada). This bill was held on the Suspense File of the
Assembly Committee on Appropriations.
Staff Comments: First-year costs are estimated at $22.5 million
(General Fund) to establish and implement a program for the
licensure and regulation of HCOs and the certification of over
101,000 home care aides in California. These costs cover
additional resources that would be necessary to conduct
licensure and periodic inspections of HCOs, certification of
home care aides, investigations of priority I and II complaints,
background checks, information technology development for
registries and enhancements to the licensure system, and
legal/administration activities.
Ongoing costs for the HCO licensure and home care aide
certification programs are estimated at $20 million, which would
result in an annual licensure fee of approximately $6,000
assuming 60 percent of ongoing costs would be attributable to
the licensure program. Assuming the remaining 40 percent of
ongoing costs would be attributable to the home care aide
certification program, an estimated certification fee of about
$80 per aide would be required to adequately cover the ongoing
administrative costs of the program as required under the
provisions of this measure.
The DOJ has indicated Special Fund costs of $280,000 in FY
2013-14, $400,000 in FY 2014-15, and $130,000 in FY 2015-16 and
annually thereafter for workload associated with additional
background checks required of all home care aides and home care
organization licensees. These costs are to be fully offset by
fee revenues from the Fingerprint Fees Account.
The SOS has indicated minor ongoing administrative costs to the
extent additional home care organizations register to conduct
intrastate business in California.
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