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