BILL ANALYSIS Ó AB 348 Page 1 Date of Hearing: April 7, 2015 ASSEMBLY COMMITTEE ON HEALTH Bonta, Chair AB 348 (Brown) - As amended March 18, 2015 SUBJECT: Long-term health care facilities. SUMMARY: Establishes a 40-working-day timeframe by which the Department of Public Health (DPH) would be required to complete investigations of long-term health care facility complaints. Specifically, this bill: 1)Requires DPH to complete its investigation of a long-term health care facility complaint within 40 working days of its receipt, and authorizes DPH to extend the 40-working-day timeframe by an additional 30 days if DPH has diligently attempted, but has not been able to obtain necessary evidence related to the investigation. 2)Requires DPH, in the case that it extends an investigation beyond 40 working days, to notify the complainant, in writing, of the basis for the extension, any outstanding evidence sought to complete the investigation, the source of the outstanding evidence, and the anticipated completion date. 3)Applies the 40-working-day, and 30-day extension timeframes to investigations of entity-reported incidents (ERIs), which are incidents such as epidemics, outbreaks, disasters, fires, disruptions of services, major accidents, or other unusual occurrences that long-term health care facilities are required to self-report to DPH. AB 348 Page 2 4)Requires DPH, effective July 1, 2016, to include in its written notice of investigation determinations, specific findings concerning each alleged violation, and a summary of the evidence upon which its determination is made. Prohibits the written determination from disclosing the names of individual residents. 5)Grants complainants 15 days, rather than five days, to request an informal conference with DPH if the complainant does not agree with the findings of the investigation. 6)Requires DPH to analyze its compliance with the complaint and ERI investigation timeframes in its annual system and staffing analysis. 7)Provides that none of the provisions proposed in this bill are to be interpreted to diminish the DPH's authority and obligation to investigate any alleged violation of state or federal law, or to enforce applicable state and federal requirements. EXISTING LAW: 1)Establishes specified timeframes relating to the investigation of complaints against long-term health care facilities made to DPH. Specifically, DPH is required to: a) Assign an inspector to make a preliminary review of the complaint and notify the complainant of the name of the assigned inspector within two working days of receipt of the complaint; b) Make an onsite inspection or investigation within 10 working days of the receipt of the complaint. If the complaint involves a threat of imminent danger of death or serious bodily harm, then DPH must make an onsite inspection within 24 hours of receipt of the complaint; and, AB 348 Page 3 c) Notify the complainant and licensee, in writing, of DPH's determination within 10 working days of the completion of the complaint investigation. 2)Requires DPH to notify a complainant of his or her right to an informal conference if that complainant is dissatisfied with DPH's investigation determinations, and grants the complainant five business days after receipt of the notice to request an informal conference. Requires DPH to notify the complainant and license of its determination within 10 working days after the informal conference. 3)Requires, under existing regulations, long-term health care facilities to self-report ERIs to DPH. 4)Requires DPH to perform a staffing and systems analysis to ensure proper allocation of departmental resources to complaint investigations and other licensing and certification activities and to make the analysis available to the public by submitting it to the Legislature and posting it on their Website. FISCAL EFFECT: This bill has not yet been analyzed by a fiscal committee. COMMENTS: 1)PURPOSE OF THIS BILL. According to the author, DPH is charged with protecting nursing home residents from harmful events and with investigating complaints filed by the public and facilities. However, the author contends that, by any measure, DPH's system of investigation is not functioning as expected. The author states that in 2009, DPH eliminated its policy calling for complaint investigations to be completed within 40 days, and now has no specific time frames for completing investigations of nursing home complaints. Despite the elimination of this policy, the author cites numerous reports issued by federal and state agencies, private organizations, and the media documenting DPH's failures to AB 348 Page 4 investigate nursing home complaints in a timely manner. The author also states that DPH has been the subject of two recent lawsuits for failing to investigate nursing home complaints with timeliness. The author concludes by stating that legislation to improve timeliness of complaint investigations is critically needed. 2)BACKGROUND. DPH's Licensing and Certification (L&C) Program is the DPH's largest program and is responsible for the regulatory oversight of over 7,500 licensed health care facilities, 2,500 of which are long-term health care facilities such as skilled nursing facilities (SNFs) and intermediate care facilities. Additionally, the federal Centers for Medicare and Medicaid Services (CMS) contracts with L&C to evaluate facilities accepting payments from Medicare and Medi-Cal, the state's Medicaid program, to ensure that they meet federal requirements. The L&C Program evaluates health care facilities for compliance with state and federal laws and regulations through a variety of required tasks, including initial and re-licensure surveys, federal certification surveys, and investigations of complaints and ERIs. The L&C Program has a field operations branch that oversees 15 district offices, which are divided between five geographic areas throughout the state. The majority of L&C activities are performed by health facility evaluator nurses (HFENs). HFENs must be licensed as registered nurses, and must undergo extensive training to properly and independently perform L&C duties and ensure uniform application and enforcement of state and federal laws, rules, and regulations pertaining to patient care. Rather than directly performing L&C activities in Los Angeles (LA) County, DPH contracts with LA County's Department of Public Health, Health Facilities Investigation Division to perform these activities on its behalf. Pursuant to this contract, county staff are responsible for performing the same L&C activities that would otherwise be performed by state L&C staff, for approximately 385 nursing homes operating within the county. This contracting arrangement has been in place for decades. The current contract is set to expire at the end AB 348 Page 5 of June 2015. According to DPH, the department is currently in negotiations with LA County to renew the contract. Additionally, the L&C Program's Professional Certifications Branch (PCB) certifies nurse assistants (a key classification of nursing home employees), home health aides, and hemodialysis technicians. The PCB is responsible for investigating complaints against and enforcing disciplinary action against the personnel it certifies. a) Complaint and ERI investigations. Investigations of nursing home complaints and ERIs are carried out pursuant to both federal and state mandates. Current law requires DPH to make an onsite investigation of a complaint against a nursing home within 10 working days of receipt. If the complaint is an immediate jeopardy complaint, meaning that it involves a threat of imminent danger of death or serious bodily harm, DPH is required to make an onsite investigation within 24 hours of receipt. However, current law does not specify the length of time required to complete complaint investigations. Longstanding concerns and complaints about the manner in which the L&C program managed complaint and ERI investigations have persisted for many years. In 2006, the Legislative Analyst's Office reported that only one-half of all complaints not classified as immediate jeopardy were investigated within the required10-day timeframe. Further, in 2007, the California State Auditor issued a report finding that the Department of Health Services (now referred to as DPH) struggled to initiate and close complaint investigations and communicate with complainants in a timely manner. In July 2012, CMS sent a letter to DPH expressing concern with their ability to meet many of its L&C responsibilities, including timely complaint investigations. The state was in jeopardy of losing $1 million in federal funds if certain benchmarks were not met. Ultimately, $138,123 in federal funding was withheld. In March 2014, concerns came to light regarding DPH's oversight of its contract with LA County after an investigative reporter uncovered evidence that the county AB 348 Page 6 had an unofficial policy to close certain nursing home complaints without fully investigating them. As a result, DPH performed a review of the county's compliance with state and federal complaint investigation requirements, and directed the county to cease its unsanctioned policy of case closures without proper investigation. The LA County Board of Supervisors requested an audit by the LA County Department of Auditor-Controller. The LA County Auditor released two audit reports, concluding, in part, that the county had a significant workload backlog and lacked a mechanism to effectively track and managed its workload. The LA County Auditor also found that complaints and ERIs were not always prioritized in accordance with state guidelines, resulting in delays in initiating investigations. In August 2014, DPH published the findings of a comprehensive assessment of the L&C Program that was performed per a 2012 request from CMS. DPH contracted with a private contractor, Hubbert Systems Consulting, to perform the assessment. In summary, the assessment found numerous deficiencies within the L&C Program, including timeliness of investigation closures, and set forth 21 recommendations to remediate deficiencies identified in its assessment. Included among these recommendations were the restructure of L&C to improve performance, establishing performance indicators, and improving oversight of LA County workload and management. DPH has accepted all 21 of the recommendations, and has developed a work plan to fully implement the recommendations within two years. In October 2014, the California State Auditor released another report regarding the L&C Program citing ineffective management of nursing home complaint investigations. The key findings of that report included: i) As of April 2014, there were more than 11,000 open complaints and ERIs backlogged, many of which had relatively high priorities, and had remained open for an average of nearly a year; ii) Despite backlogs and lengthy investigations, L&C AB 348 Page 7 does not have any policies or procedures to ensure prompt completion of complaint/ERI investigations and in many cases did not meet statutory timeframes for initiating complaint investigations; iii) There was no staffing analysis for any of its district offices to determine how much staff is needed to complete workload. Most of the L&C district offices visited by audit staff reported not having the resources needed to investigate complaints properly, and having to work overtime in order to try to keep pace with workload; and, iv) DPH failed to report all statutorily required information to the Legislature in certain years by omitting information related to the timeliness of complaint investigations in their 2012 and 2013 reports to the Legislature. The State Auditor made numerous recommendations to DPH, including that DPH establish timeframes to complete complaints and ERI investigations. According to the State Auditor, DPH did not always lack timeframes for completing investigations. The State Auditor cited departmental policies and procedures from 2004, which set forth a goal that district offices complete investigations of facility-related complaints within 40 days of receipt. DPH reported to the State Auditor that it eliminated the 40-day goal because district offices were unable to meet the timeline for various reasons. For example, DPH cited investigations involving the death of residents that could not be completed pending receipt of coroner reports. The State Auditor disagreed with DPH's decision to eliminate the 40-day timeframe, stating that, while there may be instances in which district offices cannot comply with established timeframes for valid reasons, a lack of accountability has contributed to its failure to complete investigations within reasonable periods. DPH is in the process of implementing some of the State Auditor's recommendations, but disagrees with the AB 348 Page 8 recommendation to establish a timeframe to complete investigations. According to DPH, they recognize the importance of the timeliness in completing complaint and ERI investigations and is committed to reducing the average time to complete these investigations through enhanced monitoring of workload activities, public reporting of workload performance, and improved district office implementation. In October 2014, DPH began to release quarterly data regarding the volume, timeliness, and disposition of long-term health care facility complaints and ERIs. According to most recent data released, as of December 31, 2014, the total number of open complaints and ERIs, including LA County cases and complaints against PCB-certified personnel, was 12,814. The data indicate that between July and December 2014, DPH completed 70% of complaint investigations and 77% of ERI investigations in 90 days or less. b) Governor's budget proposal. For the 2015-16 budget year, the Governor proposes funding to support the implementation of the quality improvement recommendations made by Hubbert Systems Consulting, special funds to improve oversight of its LA County contract, as well as funding to fill and add new LA County positions. The Governor proposes 237 new L&C positions and increased expenditure authority to reduce complaint/ERI volume, and decrease investigation time. With these added positions, DPH estimates that it will take four years to complete current pending investigation workload while keeping up with new workload and avoiding backlogs. 3)SUPPORT. California Advocates for Nursing Home Reform (CANHR) supports this bill, stating that it presents an historic opportunity to restore integrity to California's nursing home complaint investigation system. CANHR states that this bill is critical to establish meaningful complaint investigation deadlines, that the timely investigation of nursing home complaints is a matter of life and death for nursing home residents, and that by improving complaint investigation standards, this bill will help restore public confidence in AB 348 Page 9 California's nursing home oversight system. Other supporters state that this bill will provide certainty about DPH's responsiveness and dedication to completing investigations, thereby strengthening and improving the state's nursing home oversight and enforcement process. The California State Council of the Service Employees International Union (SEIU California), which represents the state's HFENs who perform nursing home complaint investigations, states that, due to chronic understaffing within L&C, HFENs have not had the ability to consistently complete and close investigations, resulting in a serious backlog of complaints. SEIU California states that the status quo does a disservice to nursing home residents, their families, providers, and L&C staff struggling to keep up with their workload, and that this bill will provide a timeframe by which to monitor DPH's accuracy in assessing appropriate staffing levels in the L&C program and the LA County contract. Tenet Healthcare supports this bill if amended to include language to allow for a 30-day extension of the current complaint investigation timeframe set for general acute care hospitals. Tenet states that current law sets a timeframe by which L&C must complete investigations of complaints against general acute care hospitals, and supports the establishment of a timeframe for long-term health care facilities. Tenet states that the 30-day extension provided for in this bill allows more time to accommodate complex investigations where additional evidence has to be considered in order to make thorough and accurate assessments. As such, Tenet argues that a similar extension should be allowed for complaint investigations against hospitals, and symmetry in timelines for these facility types would be for the protection of patients regardless of the setting in which they receive care. 4)RELATED LEGISLATION. AB 927 (McCarty) expands disclosure requirements regarding nursing home ownership, expands the type of information posted on DPH's website to include information regarding nursing home ownership, and modifies provisions that prohibit certain persons from governing or owning a beneficial interest in a SNF by providing for the AB 348 Page 10 denial of an application by L&C for a SNF license under circumstances in which a person named in the application has governed or owned a facility that has violated the law during the preceding seven years. AB 927 is pending in the Assembly Health Committee. 5)PREVIOUS LEGISLATION. a) AB 1816 (Yamada) of 2014 would have required DPH to set a performance benchmark for completing nursing home complaints within 60 working days of receipt; authorized DPH to extend its investigation beyond 60 days and required written notice to the complainant explaining the basis of the extension and the anticipated completion date; and, following an extension beyond the 60-day performance benchmark, required DPH to complete its investigation as expeditiously as possible. AB 1816 was held in the Senate Appropriations Committee. b) AB 1996 (Brown) of 2014 would have increased the frequency of routine inspections of long-term health care facilities from once every two years to once every year and authorized a facility inspector to refer facilities for the appointment of a temporary manager or receiver if the inspector finds it is necessary. AB 1996 was referred to the Assembly Health Committee, but not heard. c) AB 1710 (Yamada), Chapter 672, Statutes of 2012, revises how nursing home administrator licensing fees are adjusted so that fee revenue is sufficient to cover the regulatory costs to DPH and revises and increases DPH reporting requirements regarding the Nursing Home Administrator Program. d) SB 799 (Negrete-McLeod) of 2011 would have required DPH to complete long-term care facility complaint investigations within a 90-working day period. SB 799 was held on the suspense file in Senate Appropriations. e) AB 399 (Feuer) of 2007 contained provisions that are substantially similar to this bill. AB 399 was vetoed by Governor Schwarzenegger with the following message: "While AB 348 Page 11 I believe this bill is well-intended, it is premature to place additional investigation requirements on this program as it continues to demonstrate progress in meeting its mandated state and federal workload." f) AB 1807 (Committee on Budget), Chapter 74, Statutes of 2006, was the health trailer bill for the Budget Act of 2006. Among other changes, AB 1807 establishes a new fee structure for health facilities that licensed and/or certified by L&C: fees must be calculated based on: i) specified workload data provided by DPH to the Legislature and made available to the public on their website; ii) any General Fund support appropriated by the Legislature; iii) any federal grant funds received for this purpose; and iv) any policy adjustments as proposed by the Administration and as adopted by the Legislature. States intent that L&C become entirely supported by fees and federal funds by no later than July 1, 2009. g) SB 1312 (Alquist), Chapter 895, Statutes of 2006, requires inspections and investigations of long-term care facilities certified by the Medicare or Medicaid program to determine compliance with federal standards and California statutes and regulations. h) AB 1731 (Shelley), Chapter 451, Statutes of 2000, enacts major reforms for SNFs and intermediate care facilities, including the expansion of citations and penalties, an increase in disclosure requirements and inspections, requires DPH to provide specified notice to complainants within specified timeframes, and requires initial onsite investigations within 24 hours in response to complaints where there is a serious threat of imminent danger of death or serious bodily harm. 6)POLICY COMMENTS. Committee may wish to bolster compliance analysis and reporting requirements. This bill would require DPH to analyze its compliance with the timeframe requirements set forth in its annual system and staffing analysis. However, given that DPH currently reports data regarding the volume, timeliness, and disposition of complaints and ERIs on a quarterly basis, the Committee may wish to amend this bill AB 348 Page 12 to require DPH to analyze and report on its compliance quarterly rather than annually. Additionally, the Committee may wish to amend the bill to more clearly specify the elements DPH should analyze and report on, including the number and percentage of complaints and ERI investigations completed within the 40-day timeframe, the number and percentage of complaints and ERI investigations requiring an extension, and the number and percentage of complaints and ERI investigations that were not completed within required timeframes, the average length of time to complete an investigation, and the average length of time to complete investigations which exceed the timeframes set forth in this bill. REGISTERED SUPPORT / OPPOSITION: Support AARP Asian Law Alliance California Advocates for Nursing Home Reform California Association of Health Facilities California Communities United Institute California Hospital Association California Long-Term Care Ombudsman Association California Retired Teachers Association Coalition of California Welfare Rights Organizations, Inc. Consumer Attorneys of California Disability Rights California Leading Age California National Association of Social Workers, California Chapter SEIU California Tenet Healthcare (if amended) Several individuals Opposition None on file. Analysis Prepared by: Kelly Green / HEALTH / (916) 319-2097 AB 348 Page 13