BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  AB 1751
                                                                  Page  1

          Date of Hearing:   April 30, 2014

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                  Mike Gatto, Chair

                    AB 1751 (Bloom) - As Amended:  March 26, 2014 

          Policy Committee:                              Aging and  
          Long-Term CareVote:                           5-2

          Urgency:     No                   State Mandated Local Program:  
          Yes    Reimbursable:              No

           SUMMARY  

          This bill,  as proposed to be amended  ,  changes provisions  
          related to governance and oversight of Continuing Care  
          Retirement Communities (CCRCs) regulated by the Department of  
          Social Services (DSS).  Specifically, this bill:

          1)Requires financial statements to be available quarterly  
            instead of semi-annually, requires posting on a facility's web  
            site, and requires explanation of budget variances.  

          2)Requires the governing body of a CCRC to accept one resident  
            of the continuing care retirement community it operates for  
            governing bodies with 20 members or less, and at least two  
            residents for provider governing bodies with 21 or more  
            members, to participate as voting members of the provider's  
            governing body.

           FISCAL EFFECT  

          Minor, absorbable costs to DSS to oversee implementation of  
          these new CCRC requirements.

           COMMENTS  

           1)Purpose  . The author indicates current law does not require  
            adequate representation for residents on governing bodies of  
            CCRCs, nor does it provide adequate transparency with respect  
            to CCRC finances. The sponsor of the bill, California  
            Continuing Care Residents Association, believes residents  
            deserve representation and accountability that is reflective  
            of their significant financial investment.








                                                                  AB 1751
                                                                  Page  2


           2)Background  . Existing law requires DSS to regulate continuing  
            care contracts that govern care provided to an elderly  
            resident in a CCRC for the duration of the resident's life or  
            a term in excess of one year. CCRCs offer a long-term  
            continuing care contract that provides for housing,  
            residential services, and nursing care, usually in one  
            location, and usually for a resident's lifetime. Under current  
            law, the governing board of a CCRC is required to admit one  
            non-voting resident member and provide financial statements  
            semi-annually.  Residents often pay a large up-front payment  
            to join CCRCs, as well as monthly payments.  Major decisions  
            made by CCRCs, such as capital investment, can affect the cost  
            and quality of life for residents. 
                
            3)Opposition  . This bill is opposed by for-profit CCRCs, who cite  
            conflict-of-interest issues and consider the requirement for a  
            resident member on a governing board a potential regulatory  
            taking of private resources.

           4)Amendments  . Amendments replace the requirement for 3 voting  
            resident members on a facility's governing body with a  
            requirement for 1 or 2 resident members, depending on facility  
            size.   They also make the appointment of a resident member  
            upon vacancy of a seat on the governing body, provide for the  
            nomination of a resident by a resident association or resident  
            council, and allow the provider's governing board to approve  
            or disapprove the nominated resident member. 


           Analysis Prepared by  :    Lisa Murawski / APPR. / (916) 319-2081