Amended in Senate April 20, 2015

Amended in Senate April 7, 2015

Senate Bill No. 648

Introduced by Senator Mendoza

(Coauthor: Assembly Member Levine)

February 27, 2015

An act to amend Sections begin delete 1400 and 1401 end delete begin insert 1400, end insert begin insert 1401, and 1404 end insert of, and to add Sections 1402, 1409.4, begin delete 1409.5, end delete 1409.6, 1409.7, and 1409.8 to, the Health and Safety Code, relating to health and care facilities.

LEGISLATIVE COUNSEL’S DIGEST

SB 648, as amended, Mendoza. Health and care facilities: referral agencies.

Existing law requires a begin delete health care end delete referral agency to obtain a license from the State Department of Public Health in order to refer a person to any extended care facility, skilled nursing home, or intermediate care facility. Existing law exempts a local public agency performing referral services without cost from these provisions. Under existing law, a violation of these provisions is subject to a civil penalty and suspension or revocation of the license.

This bill would additionally require a referral agency to obtain a license in order to refer a person to a residential care facility for the elderly. begin delete The bill would require a referral agency to visit an extended care facility, skilled nursing home, intermediate care facility, or residential care facility for the elderly at a time designated by the licensee and client within a reasonable time after a move is completed as a result of a referral from that referral agency. end delete The bill would prohibit a referral agency from holding any power of attorney or any other property of a begin delete client. The bill end delete begin insert client, and end insert would require begin delete that referral agencies end delete begin insert a referral agency to end insert provide specified written notice to each person receiving its services. The bill would also require referral agencies to maintain liability insurance in specified amounts.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 1400 of the Health and Safety Code is
amended to read:

1400.  

(a) It is unlawful for any person, association, or
corporation to establish, conduct, or maintain a referral agency or
to refer any person for remuneration to any extended care facility,
skilled nursing home, intermediate care facility, or residential care
facility for the elderly, or a distinct part of a facility providing
extended care, skilled nursing home care, or intermediate care,
without first having obtained a written license as provided in this
chapter from the director or from an inspection service approved
by the director pursuant to Section 1257.

(b) It is unlawful for any person, association, or corporation to
establish, conduct, or maintain a referral agency or to refer any
person for remuneration to any person or agency outside a
long-term health care facility, as defined in Section 1418, for
professional services for which the long-term health care facility
does not employ a qualified professional person to furnish a
specific service, including, but not limited to, laboratory,
diagnostic, or therapy services, unless the long-term health care
facility complies with current federal and state laws regarding the
provision of these services and all of the following conditions are
met:

(1) The services will be provided in accordance with
professional standards applicable to the provision of these services
in a long-term health care facility.

(2) The long-term health care facility assumes responsibility
for timeliness of the services.

(3) Services are provided or obtained only when ordered by the
attending physician and a notation is made in the resident’s medical
chart reflecting that the service has been provided to the resident.

(c) It is unlawful for any person, association, or corporation to
establish, conduct, or maintain a referral agency or to refer any
person for remuneration to any residential care facility for the
elderly for professional services if that facility does not meet the
licensing standards established in Chapter 3.2 (commencing with
Section 1560).

SEC. 2.  

Section 1401 of the Health and Safety Code is amended
to read:

1401.  

As used in this chapter “referral agency” means a private,
profit or nonprofit agency that is engaged in the business of
referring persons for remuneration to any extended care facility,
skilled nursing home, intermediate care facility, or residential care
facility for the elderly, or a distinct part of a facility providing
extended care, skilled nursing home care, or intermediate care.

SEC. 3.  

Section 1402 is added to the Health and Safety Code,
to read:

1402.  

“Residential care facility for the elderly” has the same
meaning as set forth in Section 1569.2.

begin insert

begin insert SEC. 4. end insert   

end insert

begin insert Section 1404 of the end insert begin insert Health and Safety Code end insert begin insert is amended
to read: end insert

1404.  

No licensee under this chapter shall have a direct or
indirect financial interest in any begin delete medical end delete facility doing business
with the licensee.

begin delete SEC. 4. end delete
begin insert SEC. 5. end insert   

Section 1409.4 is added to the Health and Safety Code,
to read:

1409.4.  

(a) A licensee shall provide each person receiving
services from the licensee with written notice, in 16-point bold
type, of all of the following:

(1) Whether the licensee has an agreement or contract with the
begin delete referral end delete facility begin delete for client referrals. end delete begin insert to which the person is being
referred. end insert

(2) That a commission or fee will be received by the licensee
from the facility as a result of the referral, if applicable.

(3) Any begin insert gift or end insert exchange of monetary begin delete value, including, but not
limited to, a fee, commission, or gift received, end delete begin insert value end insert between the
facility begin delete personnel or staff end delete and the licensee begin delete and the purpose for the
exchange, if applicable. end delete begin insert that is in addition to, or in lieu of, a
commission or fee. end insert

(4) Any fee charged to the person or persons by the licensee.
The notice shall include a description of the services being rendered
for that fee and the licensee’s refund policy.

(5) The licensee’s contact information, including address and
telephone number, and the licensee’s privacy policy. The privacy
policy shall be placed clearly and prominently at the front of the
written notice.

(6) The date of the licensee’s most recent tour or visit to the
facility and, as appropriate, a review or summary of the most recent
evaluation report for a residential care facility for the elderly
prepared pursuant to Section 1569.33.

(7) Information regarding the begin delete health care end delete services the referred
facility offers, including, but not limited to, intermittent skilled
nursing care, memory care, assistance with and distribution of
medication, and other begin delete health care end delete services, if applicable.

(8) The contact information, including address and phone
number, of the State Department of Social Services or State
Department of Public Health, as appropriate, and the contact
information for filing consumer complaints, including contact
information for the local long-term care ombudsman.

(b) The licensee shall provide the written notification pursuant
to subdivision (a) in the same language in which the licensee
negotiates any referral services with the person receiving services.

(c) The licensee shall retain a signed acknowledgment from the
person being referred, or his or her conservator, guardian, family
member, or agent under a power of attorney, stating that the written
notice required by this section was received. The acknowledgment
shall be retained for a period of no less than four years.

begin delete

SEC. 5.  

Section 1409.5 is added to the Health and Safety Code,
to read:

1409.5.  

If a person moves to an extended care facility, skilled
nursing home, intermediate care facility, or residential care facility
for the elderly as a result of a referral, the licensee shall make a
scheduled visit to the facility at a time designated by the licensee
and client within a reasonable time after the move is completed.

end delete

SEC. 6.  

Section 1409.6 is added to the Health and Safety Code,
to read:

1409.6.  

It is unlawful for a licensee to share any personal
information, including, but not limited to, the name, address, age,
gender, or medical information of the person receiving services
from the licensee, with any unauthorized person or third-party
affiliate of the licensee.

SEC. 7.  

Section 1409.7 is added to the Health and Safety Code,
to read:

1409.7.  

It is unlawful for a licensee to hold any power of
attorney for a person receiving placement referral services from
that licensee, or to receive or hold a client’s property in any
capacity.

SEC. 8.  

Section 1409.8 is added to the Health and Safety Code,
to read:

1409.8.  

On begin delete or end delete begin insert and end insert after July 1, 2016, all persons, associations,
or corporations licensed pursuant to this chapter shall maintain
liability insurance coverage in an amount of at least one million
dollars ($1,000,000) per referred person and three million dollars
($3,000,000) in the total annual aggregate, for negligent acts or
omissions by the licensee.