BILL ANALYSIS                                                                                                                                                                                                    



          SENATE COMMITTEE ON APPROPRIATIONS
                             Senator Ricardo Lara, Chair
                            2015 - 2016  Regular  Session

          SB 648 (Mendoza) - Health and care facilities:  referral  
          agencies
          
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          |Version: May 5, 2015            |Policy Vote: HEALTH 7 - 2, JUD. |
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          |Urgency: No                     |Mandate: No                     |
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          |Hearing Date: May 18, 2015      |Consultant: Brendan McCarthy    |
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          This bill meets the criteria for referral to the Suspense File.




          


          Bill  
          Summary:  SB 648 would require referral agencies that refer  
          consumers to residential care facilities for the elderly to be  
          licensed by the Department of Public Health. The bill would  
          impose new disclosure and liability insurance requirements on  
          all licensed referral agencies.


          Fiscal  
          Impact:  
           Minor, one-time costs to update existing regulations by the  
            Department of Public Health (Licensing and Certification  
            Fund).







          SB 648 (Mendoza)                                       Page 1 of  
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           One-time costs of about $2.5 million over two years for  
            initial licensure of additional referral agencies by the  
            Department of Public Health (Licensing and Certification  
            Fund). The total number of referral agencies that are  
            referring consumers to residential care facilities for the  
            elderly is not known, as there are not current licensing  
            requirements for this segment of the referral agency market.  
            The Department estimates that there are about 2,000 such  
            agencies statewide. Under this assumption, it will require  
            about $2.5 million in staff costs over two years to complete  
            the initial licensing process. After that, ongoing licensing  
            and enforcement costs are anticipated to be minor.


          Background:  Under current law, the Department of Public Health licenses  
          and regulates a variety of health facilities, such as hospitals,  
          skilled nursing facilities, and intermediate care facilities.  
          The Department also licenses and regulates referral agencies  
          that refer consumers to those licensed facilities.
          Under current law, the Department of Social Services licenses  
          and regulates residential care facilities for the elderly. There  
          is no licensing requirement for referral agencies who refer  
          consumers to those facilities (unless they also refer consumers  
          to the facilities listed above, regulated by the Department of  
          Public Health).




          Proposed Law:  
            SB 648 would require referral agencies that refer consumers to  
          residential care facilities for the elderly to be licensed by  
          the Department of Public Health. The bill would impose new  
          disclosure and liability insurance requirements on all licensed  
          referral agencies.
          Specific provisions of the bill would:


           Add referral agencies that refer to residential care  
            facilities for the elderly (RCFEs) to this list of referral  
            agencies that must be licensed by the Department of Public  
            Health;
           Prohibit a referral agency from referring a consumer to a  








          SB 648 (Mendoza)                                       Page 2 of  
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            residential care facility for the elderly if that facility  
            does not meet existing licensing standards;
           Require all licensed referral agencies to provide specified  
            disclosures to consumers;
           Limit the personal information of a consumer that a referral  
            agency can share with other parties;
           Require all licensed referral agencies to have specified  
            amounts of liability insurance.


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