BILL ANALYSIS Ó
AB 1667
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Date of Hearing: April 20, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
1667 (Dodd) - As Amended April 6, 2016
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Urgency: No State Mandated Local Program: YesReimbursable:
No
SUMMARY: This bill would include "home care aide domestic
referral agencies" as a new licensure category in the Home Care
Services Consumer Protection Act overseen by the Department of
Social Services (DSS).
FISCAL EFFECT:
1)One-time costs to DSS likely in excess of $100,000 (GF) to
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revise regulations for the new licensure category.
2)One-time costs to DSS for IT changes potentially in excess of
$400,000 (GF) required by adding a new licensing category.
3)Ongoing administrative costs to DSS of approximately $4
million for workload associated with the projected 200 to 300
licensees, offset by the authority to charge initial and
renewal fees for licensure. DSS anticipates needing
approximately 30 positions including licensing analysts, legal
staff and staff for program development, in part to cover the
unique implementation and enforcement issues presented by
referral agencies that do not directly employ those they
refer.
COMMENTS:
1)Purpose. According to the author, "In 2013, California passed
the Home Care Services Consumer Protection Act (AB 1217,
Lowenthal), which provided for the licensure and regulation of
'home care organizations' that directly employ aides and
established the registration of home care aides who are
directly employed by these organizations. The Act did not
provide for the licensure of home care aide domestic referral
organizations, which are a form of employment agency that
refers home care aides to prospective clients, but does not
directly employ the aides and is not permitted to train,
supervise or monitor the care provided, nor provide any tools,
equipment or supplies to the aides. Closing this loophole is
needed so consumers know that both models are licensed and are
required to provide comparable consumer protections. It is
appropriate that consumers enjoy a consumer protection
standard applied to the whole industry, not just part of it."
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2)Background. Existing law establishes the Home Care Services
Consumer Protection Act (the Act), enacted pursuant to AB 1217
(Lowenthal) Chapter 790, Statutes of 2013, which provides for
the licensure and regulation of home care organizations and
established a registry of home care aides. Home care
organizations directly employ home care aides and are
responsible for ensuring that home care aides have received
background check clearances, have been screened for
tuberculosis, and have received a minimum level of training
prior to providing care to a client.
The Act did not provide for the licensure of domestic home
care aide referral organizations (DHCAROs) which are a form of
employment agency that refers independent home care aides to
prospective clients, but do not directly employ the home care
aides. Under the DHCARO model, consumers typically establish
"trust accounts" to make payments to the referral agency
trust, in lieu of making two separate payments to the home
care aide and referral agency. The referral agency then
retains a fee and pays the home care aide's wages from the
trust account, providing the worker with an IRS Form 1099 as
an independent contractor.
3)Arguments in Support. The Napa County Board of Supervisors,
states that, "AB 1667, would make the provisions of the Home
Care Services Consumer Protection Act applicable to home care
aide domestic referral agencies, including licensure, fees,
enforcement and fines, and regulation of registered home care
aides having agreements with those agencies."
4)Arguments in Opposition. In opposition to this bill,
California Association for Health Services at Home (CAHSAH),
states the following regarding the inclusion of home care aide
domestic referral agencies in the Home Care Services Consumer
Protection Act:
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"As currently written, this bill would significantly blur the
line between a home care organization and a domestic referral
agency. This could easily result in an individual believing
they are working with a home care organization only to find
out after facing a worker's compensation lawsuit that they
were in fact working with a domestic referral agency. The
realization of the need for home care services can often be
difficult; California must do everything it can to ensure that
the public is educated on the choices available."
5)Prior Legislation.
a) AB 782 (Dababneh), 2015, was substantially similar to
this bill. It was held in the Assembly Appropriations
Committee.
b) AB 1863 (Jones), 2014, was substantially similar to this
bill. It was held on the Senate Appropriations Committee's
Suspense File.
c) SB 855 (Committee on Budget and Fiscal Review), Chapter
29, Statutes of 2014, revised and recast provisions of the
Home Care Services Consumer Protection Act and delayed
implementation one year until January 1, 2016.
d) AB 1217 (Lowenthal), Chapter 790, Statutes of 2013,
established the Home Care Services Consumer Protection Act.
Analysis Prepared by:Jennifer Swenson / APPR. / (916)
319-2081
AB 1667
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