BILL NUMBER: SB 648 AMENDED
BILL TEXT
AMENDED IN SENATE JANUARY 5, 2016
AMENDED IN SENATE MAY 5, 2015
AMENDED IN SENATE APRIL 20, 2015
AMENDED IN SENATE APRIL 7, 2015
INTRODUCED BY Senator Mendoza
(Coauthor: Assembly Member Levine)
FEBRUARY 27, 2015
An act to amend Sections 1400, 1401, and 1404
, and 1408 of, and to add Sections 1402, 1409.4, 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 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. The bill would prohibit a referral agency from
holding any power of attorney or any other property of a person
receiving referral services, or from disclosing any personal
information of a person receiving services, unless expressly
authorized to do so. The bill would require a referral
agency to provide a disclosure statement, as specified, to each
person receiving its services, and to retain, for 4
3 years, 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 disclosure
statement was received. The bill would state that failure to provide
the disclosure statement or retain the acknowledgment, with the
intent to mislead the public on the nature of the services provided,
constitutes unfair competition and is subject to a civil penalty of
up to $2,500. 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). The referral agency may satisfy this requirement
by obtaining and relying on the licensing status
information for a residential care facility for the elderly that is
published on the Internet Web site of the State Department of Social
Services.
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.
A residential care facility for the elderly is not a
referral agency if it does either of the following:
"Referral agency" does not include any of the following:
(a) A licensed residential care facility for the elderly that does
either of the following:
(a)
(1) Provides discounts or other remuneration to
residents or their families for referring new or prospective clients.
(b)
(2) Provides remuneration to staff for marketing or
sales offers.
(b) A resident who refers a new or prospective resident and
receives a discount or other remuneration from a licensed residential
care facility for the elderly.
(c) A licensed residential care facility staff member who receives
remuneration from the facility for sales or marketing efforts.
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.
SEC. 4. Section 1404 of the Health and Safety Code is amended to
read:
1404. No licensee under this chapter shall have a direct or
indirect financial interest in any facility doing business with the
licensee.
SEC. 5. Section 1408 of the Health and
Safety Code is amended to read:
1408. (a) Upon verification of compliance with this chapter and
with the approval of the department, the department shall issue the
license to the applicant.
(b) For applicants who solely provide referrals to residential
care facilities for the elderly, the department is not required to
conduct an on-site licensing inspection as a condition of verifying
compliance with this chapter.
(c) As a condition of verifying compliance with this chapter, the
department may require an applicant to submit a copy or example of
the disclosure statement required by Section 1409.4.
(b)
(d) If the applicant is not in compliance with this
chapter, the department shall deny the applicant a license.
Immediately upon the denial of any license, the department shall
notify the applicant in writing. Within 20 days of receipt of the
department's notice, the applicant may present his or her written
petition for a hearing to the department. The proceedings shall be
conducted in accordance with Section 100171.
SEC. 5. SEC. 6. Section 1409.4 is
added to the Health and Safety Code, to read:
1409.4. (a) Prior to any referral, Before
referring a person to any facility, a licensee shall provide
each person receiving services from the licensee
the person with a disclosure statement containing all of
the following:
(1) Whether the licensee has an agreement or contract with the
facility to which the person is being referred.
(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 gift or exchange of monetary value between the facility
and the licensee that is in addition to, or in lieu of, a commission
or fee.
(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 may be provided as an Internet Web site link consistent with
provisions set forth in Section 22575 of the Business and Professions
Code.
(6) The date of the licensee's most recent tour or visit to the
facility and, as appropriate, a report of any violations as
identified by a hyperlink to, or copy of, the
most recent evaluation report for a residential care facility for the
elderly to which the person is being referred, prepared
pursuant to Section 1569.33 and published by the
State Department of Social Services .
(7) Information regarding the type of facility and the
services the referred facility offers, including, but not
limited to, intermittent skilled nursing care, memory care,
assistance with and distribution of medication, and other services,
if applicable. offered by the facility.
(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. If the disclosure statement is
provided electronically, the contact information for each department
and the local long-term care ombudsman may be provided as a
hyperlink.
(b) (1) The disclosure statement shall be dated and shall contain,
in addition to the requirements of subdivision (a), the name of the
person being referred.
(2) If the disclosure is provided in written form, it shall be
printed in 16-point bold type.
(3) If the disclosure statement is provided electronically, it
shall be consistent with provisions regarding electronic
records set forth in Section 7001 of Title 15 of the United States
Code, set forth in Title 2.5 (commencing with Section
1633.1) of Part 2 of Division 3 of the Civil Code, and shall be
displayed on the licensee's Internet Web site
a secured Web page in a larger type than the surrounding
text.
(c) The licensee shall provide the disclosure statement pursuant
to subdivision (a) in the same language in which the licensee
negotiates any referral services with the person receiving services.
(d) Prior to any referral, the licensee shall retain a
signed acknowledgment from The disclosure statement
shall be signed or otherwise acknowledged by the person being
referred, or his or her conservator, guardian, family member, or
agent under a power of attorney, stating that the disclosure
statement required by this section was received. The signed
acknowledgment shall be executed with one of the following:
(1) The signature of the person being referred, or his or her
conservator, guardian, family member, or agent under a power of
attorney on the exact disclosure statement.
(2) An electronic signature that is consistent with standards
set forth in Title 2.5 (commencing with Section 1633.1) of Part 2 of
Division 3 of the Civil Code and includes the date, time, and
Internet provider address and displays the exact disclosure statement
document.
(3) A faxed confirmation that includes the date, time, and fax
number and displays the exact disclosure statement document.
(e) The acknowledgment required by this section shall be retained
for a period of no less than four three
years.
(f) If the disclosure statement, or any other referral-related
document, is provided electronically, the licensee shall provide a
written copy, in a 16-point bold type, to the
person being referred, or his or her conservator, guardian, family
member, or agent under power of attorney following any referral. This
written copy may be provided by fax, email, or other means of
electronic communication, if applicable.
appropriate.
(g) Any violation of this section with the intent to directly or
indirectly mislead the public on the nature of services provided by
the referral agency will constitute unfair competition which includes
unlawful, unfair, or fraudulent business acts or practices and
unfair, deceptive, untrue, or misleading advertising. Any person or
entity that engages in unfair competition shall be liable for a civil
penalty not to exceed two thousand five hundred dollars ($2,500) for
each violation.
SEC. 6. SEC. 7. Section 1409.6 is
added to the Health and Safety Code, to read:
1409.6. (a) 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, unless expressly authorized
pursuant to subdivisions (b) and (c).
subdivision (b).
(b) The person being referred, or his or her conservator,
guardian, family member, or agent under power of attorney may
expressly authorize the licensee to share his or her name and
telephone number, or email address, with the facility, or facilities,
being referred. The express authorization shall be separate from the
disclosure statement required by this article and shall include both
of the following:
(1) Disclosure, in a form consistent with the requirements of
Section 1409.4, which clearly and conspicuously states the name,
location, and contact information of the facility, or facilities,
that will receive the contact information, and the format in which
the facility will receive the contact information.
(2) The signature of the person giving authorization, consistent
with the requirements of subdivision (d) of Section 1409.4.
(c) The licensee shall only share the name and contact information
of the individual who has provided express authorization, pursuant
to subdivision (b).
(b) Before making a referral to any facility or facilities, the
person being referred, or his or her conservator, guardian, family
member, or agent under power of attorney, may authorize the licensee
to share his or her personal information, as well as the name and a
description of the care or services needed by the individual being
referred, with a facility or facilities for purposes of the referral.
The personal information, or other information shared, shall be
limited to only that information which is necessary to complete the
referral process. The authorization shall be obtained in either of
the following ways:
(1) As a separate authorization form that clearly discloses that,
by executing an acknowledgment in the manner described in subdivision
(d) of Section 1409.4, the individual is consenting to the
disclosure of his or her personal information to a facility or
facilities for which they are being referred. This acknowledgment
shall include the name and location of the facility or facilities
that will receive the personal information and the format in which
the personal information will be shared.
(2) As part of the disclosure statement required by Section 1409.4
if it clearly indicates that the individual is consenting to the
referral agency's disclosure of his or her personal information to a
facility or facilities for which her or she is being referred. The
authorization shall include the name and location information of the
facility or facilities that will receive the personal information and
the format in which the personal information will be shared.
(c) The licensee shall not share the contact information of an
individual who has not provided his or her authorization pursuant to
subdivision (b).
SEC. 7. SEC. 8. 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. SEC. 9. Section 1409.8 is
added to the Health and Safety Code, to read:
1409.8. On and 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
occurrence person and three million dollars
($3,000,000) in the total annual aggregate, for negligent acts or
omissions by the licensee.