Amended in Senate April 14, 2016

Senate BillNo. 939


Introduced by Senator Monning

February 3, 2016


An act to amend Sections 1771, 1788, and 1788.4 of the Health and Safety Code, relating to continuing care contracts.

LEGISLATIVE COUNSEL’S DIGEST

SB 939, as amended, Monning. Continuing care contracts: cancellation: payments.

Existing law requires a continuing care retirement facility, as defined, to possess a certificate of authority issued by the State Department of Social Services before it can enter into a continuing care contract, as defined. Existing law requires that a continuing care contract be in writing and contain specified information. Existing law provides that a continuing care contract may be canceled without cause by written notice from either party within 90 days of the resident’s initial occupancy.

Existing law requires a provider to pay, during the cancellation period, all refunds owed to a resident within 14 days after a resident makes possession of the living unit available to the provider. Existing law requires a provider to pay a lump-sum payment that is conditioned upon resale of a unit to a resident within 14 days after resale of the unit.

This bill would instead specify that a continuing care retirement facility pay the full lump-sum payment that is conditioned upon resale of a unit to abegin delete residentend deletebegin insert resident, including any interest accrued,end insert within 14 days after resale of a unit. The bill would require a continuing care retirement facility, for contracts signed after January 1, 2017, to pay a resident or his or her estate a specified portion of the fullbegin delete lump-sum payment,end deletebegin insert lump sum owed,end insert notwithstanding a provider’s documented good-faith effort to resell the unit, if the unit remains vacant 120 days after the resident’s termination. The bill would require anybegin delete payment balanceend deletebegin insert amount owed that isend insert not paid to a resident within 180 days to accrue simplebegin delete interest, to be compounded annually,end deletebegin insert interestend insert at a rate of 4% until the fullbegin delete lump-sum paymentend deletebegin insert amount owedend insert isbegin delete made.end deletebegin insert paid.end insert The bill would require anybegin delete payment balanceend deletebegin insert amount owed that isend insert not paid to a resident within 240 days to accrue simplebegin delete interest, to be compounded annually,end deletebegin insert interestend insert at a rate of 6% until the fullbegin delete lump-sum paymentend deletebegin insert amount owedend insert isbegin delete made.end deletebegin insert paid. The bill would require any amount owed that is not paid to a resident within one year after the 240-day period to accrue compound interest annually at a rate of 6% until the amount owed is paid.end insert The bill would require a facility tobegin delete make the lump-sum paymentend deletebegin insert pay the lump sum owed, including any interest accrued,end insert to a resident’s estate if the resident is deceased. The bill would provide that, until January 1, 2018, these provisions do not apply to specified projects that are in development prior to January 1, 2017, provided that the initial contract for the project is entered into on or before January 1, 2018. The bill would provide that the repayment by a provider of all or a portion of an entrance fee before the resale of a unit would not subject any other entrance fee to the refund reserve requirements, except as provided.

The bill would make corresponding changes to require a continuing care contract to contain a statement that a provider is prohibited from charging the resident or his or her estate a monthly fee once a unit has been permanently vacated by the resident, unless the fee is part of an equity interest contract. The bill would also require a continuing care contract that provides for a refund or repayment of a lump sum of all or part of the entrance fee to include a statement that the provider will make a good-faith effort to reoccupy or resell a unit for which a lump-sum payment is conditioned upon resale of the unit.

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

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

P2    1

SECTION 1.  

Section 1771 of the Health and Safety Code is
2amended to read:

3

1771.  

Unless the context otherwise requires, the definitions in
4this section govern the interpretation of this chapter.

P3    1(a) (1) “Affiliate” means any person, corporation, limited
2liability company, business trust, trust, partnership, unincorporated
3association, or other legal entity that directly or indirectly controls,
4is controlled by, or is under common control with, a provider or
5applicant.

6(2) “Affinity group” means a grouping of entities sharing a
7common interest, philosophy, or connection (e.g., military officers,
8religion).

9(3) “Annual report” means the report each provider is required
10to file annually with the department, as described in Section 1790.

11(4) “Applicant” means any entity, or combination of entities,
12that submits and has pending an application to the department for
13a permit to accept deposits and a certificate of authority.

14(5) “Assisted living services” includes, but is not limited to,
15assistance with personal activities of daily living, including
16dressing, feeding, toileting, bathing, grooming, mobility, and
17associated tasks, to help provide for and maintain physical and
18psychosocial comfort.

19(6) “Assisted living unit” means the living area or unit within
20a continuing care retirement community that is specifically
21designed to provide ongoing assisted living services.

22(7) “Audited financial statement” means financial statements
23prepared in accordance with generally accepted accounting
24principles, including the opinion of an independent certified public
25accountant, and notes to the financial statements considered
26customary or necessary to provide full disclosure and complete
27information regarding the provider’s financial statements, financial
28condition, and operation.

29(b) (reserved)

30(c) (1) “Cancel” means to destroy the force and effect of an
31agreement or continuing care contract.

32(2) “Cancellation period” means the 90-day period, beginning
33when the resident physically moves into the continuing care
34retirement community, during which the resident may cancel the
35continuing care contract, as provided in Section 1788.2.

36(3) “Care” means nursing, medical, or other health-related
37services, protection or supervision, assistance with the personal
38activities of daily living, or any combination of those services.

39(4) “Cash equivalent” means certificates of deposit and United
40States treasury securities with a maturity of five years or less.

P4    1(5) “Certificate” or “certificate of authority” means the
2certificate issued by the department, properly executed and bearing
3the State Seal, authorizing a specified provider to enter into one
4or more continuing care contracts at a single specified continuing
5care retirement community.

6(6) “Condition” means a restriction, specific action, or other
7requirement imposed by the department for the initial or continuing
8validity of a permit to accept deposits, a provisional certificate of
9authority, or a certificate of authority. A condition may limit the
10circumstances under which the provider may enter into any new
11deposit agreement or contract, or may be imposed as a condition
12precedent to the issuance of a permit to accept deposits, a
13provisional certificate of authority, or a certificate of authority.

14(7) “Consideration” means some right, interest, profit, or benefit
15paid, transferred, promised, or provided by one party to another
16as an inducement to contract. Consideration includes some
17forbearance, detriment, loss, or responsibility, that is given,
18suffered, or undertaken by a party as an inducement to another
19party to contract.

20(8) “Continuing care contract” means a contract that includes
21a continuing care promise made, in exchange for an entrance fee,
22the payment of periodic charges, or both types of payments. A
23continuing care contract may consist of one agreement or a series
24of agreements and other writings incorporated by reference.

25(9) “Continuing care promise” means a promise, expressed or
26implied, by a provider to provide one or more elements of care to
27an elderly resident for the duration of his or her life or for a term
28in excess of one year. Any such promise or representation, whether
29part of a continuing care contract, other agreement, or series of
30agreements, or contained in any advertisement, brochure, or other
31material, either written or oral, is a continuing care promise.

32(10) “Continuing care retirement community” means a facility
33located within the State of California where services promised in
34a continuing care contract are provided. A distinct phase of
35development approved by the department may be considered to
36be the continuing care retirement community when a project is
37being developed in successive distinct phases over a period of
38time. When the services are provided in residents’ own homes, the
39homes into which the provider takes those services are considered
40part of the continuing care retirement community.

P5    1(11) “Control” means directing or causing the direction of the
2financial management or the policies of another entity, including
3an operator of a continuing care retirement community, whether
4by means of the controlling entity’s ownership interest, contract,
5or any other involvement. A parent entity or sole member of an
6entity controls a subsidiary entity provider for a continuing care
7retirement community if its officers, directors, or agents directly
8participate in the management of the subsidiary entity or in the
9initiation or approval of policies that affect the continuing care
10retirement community’s operations, including, but not limited to,
11approving budgets or the administrator for a continuing care
12retirement community.

13(d) (1) “Department” means the State Department of Social
14Services.

15(2) “Deposit” means any transfer of consideration, including a
16promise to transfer money or property, made by a depositor to any
17entity that promises or proposes to promise to provide continuing
18care, but is not authorized to enter into a continuing care contract
19with the potential depositor.

20(3) “Deposit agreement” means any agreement made between
21any entity accepting a deposit and a depositor. Deposit agreements
22for deposits received by an applicant prior to the department’s
23release of funds from the deposit escrow account shall be subject
24to the requirements described in Section 1780.4.

25(4) “Depository” means a bank or institution that is a member
26of the Federal Deposit Insurance Corporation or a comparable
27deposit insurance program.

28(5) “Depositor” means any prospective resident who pays a
29deposit. Where any portion of the consideration transferred to an
30applicant as a deposit or to a provider as consideration for a
31continuing care contract is transferred by a person other than the
32prospective resident or a resident, that third-party transferor shall
33have the same cancellation or refund rights as the prospective
34resident or resident for whose benefit the consideration was
35transferred.

36(6) “Director” means the Director of Social Services.

37(e) (1) “Elderly” means an individual who is 60 years of age
38or older.

39(2) “Entity” means an individual, partnership, corporation,
40limited liability company, and any other form for doing business.
P6    1Entity includes a person, sole proprietorship, estate, trust,
2association, and joint venture.

3(3) “Entrance fee” means the sum of any initial, amortized, or
4deferred transfer of consideration made or promised to be made
5by, or on behalf of, a person entering into a continuing care contract
6for the purpose of ensuring care or related services pursuant to that
7continuing care contract or as full or partial payment for the
8promise to provide care for the term of the continuing care contract.
9Entrance fee includes the purchase price of a condominium,
10cooperative, or other interest sold in connection with a promise of
11continuing care. An initial, amortized, or deferred transfer of
12consideration that is greater in value than 12 times the monthly
13care fee shall be presumed to be an entrance fee.

14(4) “Equity” means the value of real property in excess of the
15aggregate amount of all liabilities secured by the property.

16(5) “Equity interest” means an interest held by a resident in a
17continuing care retirement community that consists of either an
18ownership interest in any part of the continuing care retirement
19community property or a transferable membership that entitles the
20holder to reside at the continuing care retirement community.

21(6) “Equity project” means a continuing care retirement
22community where residents receive an equity interest in the
23continuing care retirement community property.

24(7) “Equity securities” shall refer generally to large and
25midcapitalization corporate stocks that are publicly traded and
26 readily liquidated for cash, and shall include shares in mutual funds
27that hold portfolios consisting predominantly of these stocks and
28other qualifying assets, as defined by Section 1792.2. Equity
29securities shall also include other similar securities that are
30specifically approved by the department.

31(8) “Escrow agent” means a bank or institution, including, but
32not limited to, a title insurance company, approved by the
33department to hold and render accountings for deposits of cash or
34cash equivalents.

35(f) “Facility” means any place or accommodation where a
36provider provides or will provide a resident with care or related
37services, whether or not the place or accommodation is constructed,
38owned, leased, rented, or otherwise contracted for by the provider.

39(g) (reserved)

40(h) (reserved)

P7    1(i) (1) “Inactive certificate of authority” means a certificate that
2has been terminated under Section 1793.8.

3(2) “Investment securities” means any of the following:

4(A) Direct obligations of the United States, including obligations
5issued or held in book-entry form on the books of the United States
6Department of the Treasury or obligations the timely payment of
7the principal of, and the interest on, which are fully guaranteed by
8the United States.

9(B) Obligations, debentures, notes, or other evidences of
10indebtedness issued or guaranteed by any of the following:

11(i) The Federal Home Loan Bank System.

12(ii) The Export-Import Bank of the United States.

13(iii) The Federal Financing Bank.

14(iv) The Government National Mortgage Association.

15(v) The Farmers Home Administration.

16(vi) The Federal Home Loan Mortgage Corporation of the
17Federal Housing Administration.

18(vii) Any agency, department, or other instrumentality of the
19United States if the obligations are rated in one of the two highest
20rating categories of each rating agency rating those obligations.

21(C) Bonds of the State of California or of any county, city and
22county, or city in this state, if rated in one of the two highest rating
23categories of each rating agency rating those bonds.

24(D) Commercial paper of finance companies and banking
25institutions rated in one of the two highest categories of each rating
26agency rating those instruments.

27(E) Repurchase agreements fully secured by collateral security
28described in subparagraph (A) or (B), as evidenced by an opinion
29of counsel, if the collateral is held by the provider or a third party
30during the term of the repurchase agreement, pursuant to the terms
31of the agreement, subject to liens or claims of third parties, and
32has a market value, which is determined at least every 14 days, at
33least equal to the amount so invested.

34(F) Long-term investment agreements, which have maturity
35dates in excess of one year, with financial institutions, including,
36but not limited to, banks and insurance companies or their affiliates,
37if the financial institution’s paying ability for debt obligations or
38long-term claims or the paying ability of a related guarantor of the
39financial institution for these obligations or claims, is rated in one
40of the two highest rating categories of each rating agency rating
P8    1those instruments, or if the short-term investment agreements are
2with the financial institution or the related guarantor of the financial
3institution, the long-term or short-term debt obligations, whichever
4is applicable, of which are rated in one of the two highest long-term
5or short-term rating categories, of each rating agency rating the
6bonds of the financial institution or the related guarantor, provided
7that if the rating falls below the two highest rating categories, the
8 investment agreement shall allow the provider the option to replace
9the financial institution or the related guarantor of the financial
10institution or shall provide for the investment securities to be fully
11collateralized by investments described in subparagraph (A), and,
12provided further, if so collateralized, that the provider has a
13perfected first security lien on the collateral, as evidenced by an
14opinion of counsel and the collateral is held by the provider.

15(G) Banker’s acceptances or certificates of deposit of, or time
16deposits in, any savings and loan association that meets any of the
17following criteria:

18(i) The debt obligations of the savings and loan association, or
19in the case of a principal bank, of the bank holding company, are
20rated in one of the two highest rating categories of each rating
21agency rating those instruments.

22(ii) The certificates of deposit or time deposits are fully insured
23by the Federal Deposit Insurance Corporation.

24(iii) The certificates of deposit or time deposits are secured at
25all times, in the manner and to the extent provided by law, by
26collateral security described in subparagraph (A) or (B) with a
27market value, valued at least quarterly, of no less than the original
28amount of moneys so invested.

29(H) Taxable money market government portfolios restricted to
30obligations issued or guaranteed as to payment of principal and
31interest by the full faith and credit of the United States.

32(I) Obligations the interest on which is excluded from gross
33income for federal income tax purposes and money market mutual
34funds whose portfolios are restricted to these obligations, if the
35obligations or mutual funds are rated in one of the two highest
36rating categories by each rating agency rating those obligations.

37(J) Bonds that are not issued by the United States or any federal
38agency, but that are listed on a national exchange and that are rated
39at least “A” by Moody’s Investors Service, or the equivalent rating
40by Standard and Poor’s Corporation or Fitch Investors Service.

P9    1(K) Bonds not listed on a national exchange that are traded on
2an over-the-counter basis, and that are rated at least “Aa” by
3Moody’s Investors Service or “AA” by Standard and Poor’s
4Corporation or Fitch Investors Service.

5(j) (reserved)

6(k) (reserved)

7(l) “Life care contract” means a continuing care contract that
8includes a promise, expressed or implied, by a provider to provide
9or pay for routine services at all levels of care, including acute
10care and the services of physicians and surgeons, to the extent not
11covered by other public or private insurance benefits, to a resident
12for the duration of his or her life. Care shall be provided under a
13life care contract in a continuing care retirement community having
14a comprehensive continuum of care, including a skilled nursing
15facility, under the ownership and supervision of the provider on
16or adjacent to the premises. A change shall not be made in the
17monthly fee based on level of care. A life care contract shall also
18include provisions to subsidize residents who become financially
19unable to pay their monthly care fees.

20(m) (1) “Monthly care fee” means the fee charged to a resident
21in a continuing care contract on a monthly or other periodic basis
22for current accommodations and services, including care, board,
23or lodging. Periodic entrance fee payments or other prepayments
24shall not be monthly care fees.

25(2) “Monthly fee contract” means a continuing care contract
26that requires residents to pay monthly care fees.

27(n) “Nonambulatory person” means a person who is unable to
28leave a building unassisted under emergency conditions in the
29manner described by Section 13131.

30(o) (reserved)

31(p) (1) “Per capita cost” means a continuing care retirement
32community’s operating expenses, excluding depreciation, divided
33by the average number of residents.

34(2) “Periodic charges” means fees paid by a resident on a
35periodic basis.

36(3) “Permanent closure” means the voluntary or involuntary
37termination or forfeiture, as specified in subdivisions (a), (b), (g),
38(h), and (i) of Section 1793.7, of a provider’s certificate of authority
39or license, or another action that results in the permanent relocation
P10   1of residents. Permanent closure does not apply in the case of a
2natural disaster or other event out of the provider’s control.

3(4) “Permit to accept deposits” means a written authorization
4by the department permitting an applicant to enter into deposit
5agreements regarding a single specified continuing care retirement
6community.

7(5) “Prepaid contract” means a continuing care contract in which
8the monthly care fee, if any, may not be adjusted to cover the actual
9cost of care and services.

10(6) “Preferred access” means that residents who have previously
11occupied a residential living unit have a right over other persons
12to any assisted living or skilled nursing beds that are available at
13the community.

14(7) “Processing fee” means a payment to cover administrative
15costs of processing the application of a depositor or prospective
16 resident.

17(8) “Promise to provide one or more elements of care” means
18any expressed or implied representation that one or more elements
19of care will be provided or will be available, such as by preferred
20access.

21(9) “Proposes” means a representation that an applicant or
22provider will or intends to make a future promise to provide care,
23including a promise that is subject to a condition, such as the
24construction of a continuing care retirement community or the
25acquisition of a certificate of authority.

26(10) “Provider” means an entity that provides continuing care,
27makes a continuing care promise, or proposes to promise to provide
28continuing care. “Provider” also includes any entity that controls
29an entity that provides continuing care, makes a continuing care
30promise, or proposes to promise to provide continuing care. The
31department shall determine whether an entity controls another
32entity for purposes of this article. No homeowner’s association,
33cooperative, or condominium association may be a provider.

34(11) “Provisional certificate of authority” means the certificate
35issued by the department, properly executed and bearing the State
36Seal, under Section 1786. A provisional certificate of authority
37shall be limited to the specific continuing care retirement
38community and number of units identified in the applicant’s
39application.

40(q) (reserved)

P11   1(r) (1) “Refund reserve” means the reserve a provider is required
2to maintain, as provided in Section 1792.6.

3(2) (A) “Refundable contract” means a continuing care contract
4that includes a promise, expressed or implied, by the provider to
5pay an entrance fee refund or to repurchase the transferor’s unit,
6membership, stock, or other interest in the continuing care
7retirement community when the promise to refund some or all of
8the initial entrance fee extends beyond the resident’s sixth year of
9residency. Providers that enter into refundable contracts shall be
10subject to the refund reserve requirements of Section 1792.6.

11(B) A continuing care contract that includes a promise to repay
12all or a portion of an entrance fee that is conditioned upon
13reoccupancy or resale of the unit previously occupied by the
14resident shall not be considered a refundable contract for purposes
15of the refund reserve requirements of Section 1792.6, provided
16that this conditional promise of repayment is not referred to by the
17applicant or provider as a “refund.” A provider may repay all or
18a portion of an entrance fee that is conditioned upon resale of the
19unit before the resale of the unit. The repayment of an entrance
20fee before the resale of the unit shall not cause any other entrance
21fee to be subject to the refund reserve requirements of Section
221792.6, provided that the provider does not promise, at the time
23of contracting or thereafter, to make this type of early repayment,
24represent that the provider intends to make this type of early
25repayment, or indicate that the provider has a practice of making
26this type of early repayment.

27(3) “Resale fee” means a levy by the provider against the
28proceeds from the sale of a transferor’s equity interest.

29(4) “Reservation fee” refers to consideration collected by an
30entity that has made a continuing care promise or is proposing to
31make this promise and has complied with Section 1771.4.

32(5) “Resident” means a person who enters into a continuing
33care contract with a provider, or who is designated in a continuing
34care contract to be a person being provided or to be provided
35services, including care, board, or lodging.

36(6) “Residential care facility for the elderly” means a housing
37arrangement as defined by Section 1569.2.

38(7) “Residential living unit” means a living unit in a continuing
39care retirement community that is not used exclusively for assisted
40living services or nursing services.

P12   1(8) “Residential temporary relocation” means the relocation of
2one or more residents, except in the case of a natural disaster that
3is out of the provider’s control, from one or more residential living
4units, assisted living units, skilled nursing units, or a wing, floor,
5or entire continuing care retirement community building, due to a
6change of use or major repairs or renovations. A residential
7temporary relocation shall mean a relocation pursuant to this
8subdivision that lasts for a period of at least 9 months but that does
9not exceed 18 months without the written agreement of the resident.

10(s) (reserved)

11(t) (1) “Termination” means the ending of a continuing care
12contract as provided for in the terms of the continuing care contract.

13(2) “Transfer trauma” means death, depression, or regressive
14behavior, that is caused by the abrupt and involuntary transfer of
15an elderly resident from one home to another and results from a
16loss of familiar physical environment, loss of well-known
17neighbors, attendants, nurses and medical personnel, the stress of
18an abrupt break in the small routines of daily life, or the loss of
19visits from friends and relatives who may be unable to reach the
20new facility.

21(3) “Transferor” means a person who transfers, or promises to
22transfer, consideration in exchange for care and related services
23under a continuing care contract or proposed continuing care
24contract, for the benefit of another. A transferor shall have the
25same rights to cancel and obtain a refund as the depositor under
26the deposit agreement or the resident under a continuing care
27contract.

28

SEC. 2.  

Section 1788 of the Health and Safety Code is amended
29to read:

30

1788.  

(a) A continuing care contract shall contain all of the
31following:

32(1) The legal name and address of each provider.

33(2) The name and address of the continuing care retirement
34community.

35(3) The resident’s name and the identity of the unit the resident
36will occupy.

37(4) If there is a transferor other than the resident, the transferor
38shall be a party to the contract and the transferor’s name and
39address shall be specified.

P13   1(5) If the provider has used the name of any charitable or
2religious or nonprofit organization in its title before January 1,
31979, and continues to use that name, and that organization is not
4responsible for the financial and contractual obligations of the
5provider or the obligations specified in the continuing care contract,
6the provider shall include in every continuing care contract a
7conspicuous statement that clearly informs the resident that the
8organization is not financially responsible.

9(6) The date the continuing care contract is signed by the
10resident and, where applicable, any other transferor.

11(7) The duration of the continuing care contract.

12(8) A list of the services that will be made available to the
13resident as required to provide the appropriate level of care. The
14list of services shall include the services required as a condition
15for licensure as a residential care facility for the elderly, including
16all of the following:

17(A) Regular observation of the resident’s health status to ensure
18that his or her dietary needs, social needs, and needs for special
19services are satisfied.

20(B) Safe and healthful living accommodations, including
21housekeeping services and utilities.

22(C) Maintenance of house rules for the protection of residents.

23(D) A planned activities program, which includes social and
24recreational activities appropriate to the interests and capabilities
25of the resident.

26(E) Three balanced, nutritious meals and snacks made available
27daily, including special diets prescribed by a physician as a medical
28necessity.

29(F) Assisted living services.

30(G) Assistance with taking medications.

31(H) Central storing and distribution of medications.

32(I) Arrangements to meet health needs, including arranging
33transportation.

34(9) An itemization of the services that are included in the
35monthly fee and the services that are available at an extra charge.
36The provider shall attach a current fee schedule to the continuing
37care contract. The schedule shall state that a provider is prohibited
38from charging the resident or his or her estate a monthly fee once
39a unit has been permanently vacated by the resident, unless the fee
40is part of an equity interest contract.

P14   1(10) The procedures and conditions under which a resident may
2be voluntarily and involuntarily transferred from a designated
3living unit. The transfer procedures, at a minimum, shall include
4provisions addressing all of the following circumstances under
5which a transfer may be authorized:

6(A) A continuing care retirement community may transfer a
7resident under the following conditions, taking into account the
8appropriateness and necessity of the transfer and the goal of
9promoting resident independence:

10(i) The resident is nonambulatory. The definition of
11“nonambulatory,” as provided in Section 13131, shall either be
12stated in full in the continuing care contract or be cited. If Section
1313131 is cited, a copy of the statute shall be made available to the
14resident, either as an attachment to the continuing care contract or
15by specifying that it will be provided upon request. If a
16nonambulatory resident occupies a room that has a fire clearance
17for nonambulatory residents, transfer shall not be necessary.

18(ii) The resident develops a physical or mental condition that
19endangers the health, safety, or well-being of the resident or another
20person.

21(iii) The resident’s condition or needs require the resident’s
22transfer to an assisted living care unit or skilled nursing facility,
23because the level of care required by the resident exceeds that
24which may be lawfully provided in the living unit.

25(iv) The resident’s condition or needs require the resident’s
26transfer to a nursing facility, hospital, or other facility, and the
27provider has no facilities available to provide that level of care.

28(B) Before the continuing care retirement community transfers
29a resident under any of the conditions set forth in subparagraph
30(A), the community shall satisfy all of the following requirements:

31(i) Involve the resident and the resident’s responsible person,
32as defined in paragraph (6) of subdivision (r) of Section 87101 of
33Title 22 of the California Code of Regulations, and upon the
34resident’s or responsible person’s request, family members, or the
35resident’s physician or other appropriate health professional, in
36the assessment process that forms the basis for the level of care
37transfer decision by the provider. The provider shall offer an
38explanation of the assessment process. If an assessment tool or
39tools, including scoring and evaluating criteria, are used in the
40determination of the appropriateness of the transfer, the provider
P15   1shall make copies of the completed assessment available upon the
2request of the resident or the resident’s responsible person.

3(ii) Prior to sending a formal notification of transfer, the provider
4shall conduct a care conference with the resident and the resident’s
5responsible person, and upon the resident’s or responsible person’s
6request, family members, and the resident’s health care
7professionals, to explain the reasons for transfer.

8(iii) Notify the resident and the resident’s responsible person
9of the reasons for the transfer in writing.

10(iv) Notwithstanding any other provision of this subparagraph,
11if the resident does not have impairment of cognitive abilities, the
12resident may request that his or her responsible person not be
13involved in the transfer process.

14(v) The notice of transfer shall be made at least 30 days before
15the transfer is expected to occur, except when the health or safety
16of the resident or other residents is in danger, or the transfer is
17required by the resident’s urgent medical needs. Under those
18circumstances, the written notice shall be made as soon as
19practicable before the transfer.

20(vi) The written notice shall contain the reasons for the transfer,
21the effective date, the designated level of care or location to which
22the resident will be transferred, a statement of the resident’s right
23to a review of the transfer decision at a care conference, as provided
24for in subparagraph (C), and for disputed transfer decisions, the
25right to review by the Continuing Care Contracts Branch of the
26State Department of Social Services, as provided for in
27subparagraph (D). The notice shall also contain the name, address,
28and telephone number of the department’s Continuing Care
29Contracts Branch.

30(vii) The continuing care retirement community shall provide
31sufficient preparation and orientation to the resident to ensure a
32safe and orderly transfer and to minimize trauma.

33(C) The resident has the right to review the transfer decision at
34a subsequent care conference that shall include the resident, the
35resident’s responsible person, and upon the resident’s or
36responsible person’s request, family members, the resident’s
37physician or other appropriate health care professional, and
38members of the provider’s interdisciplinary team. The local
39ombudsperson may also be included in the care conference, upon
P16   1the request of the resident, the resident’s responsible person, or
2the provider.

3(D) For disputed transfer decisions, the resident or the resident’s
4responsible person has the right to a prompt and timely review of
5the transfer process by the Continuing Care Contracts Branch of
6the State Department of Social Services.

7(E) The decision of the department’s Continuing Care Contracts
8Branch shall be in writing and shall determine whether the provider
9failed to comply with the transfer process pursuant to
10subparagraphs (A) to (C), inclusive. Pending the decision of the
11Continuing Care Contracts Branch, the provider shall specify any
12additional care the provider believes is necessary in order for the
13resident to remain in his or her unit. The resident may be required
14to pay for the extra care, as provided in the contract.

15(F) Transfer of a second resident when a shared accommodation
16arrangement is terminated.

17(11) Provisions describing any changes in the resident’s monthly
18fee and any changes in the entrance fee refund payable to the
19resident that will occur if the resident transfers from any unit,
20including, but not limited to, terminating his or her contract after
2118 months of residential temporary relocation, as defined in
22paragraph (8) of subdivision (r) of Section 1771. Unless the fee is
23part of an equity interest contract, a provider is prohibited from
24charging the resident or his or her estate a monthly fee once a unit
25has been permanently vacated by the resident.

26(12) The provider’s continuing obligations, if any, in the event
27a resident is transferred from the continuing care retirement
28community to another facility.

29(13) The provider’s obligations, if any, to resume care upon the
30resident’s return after a transfer from the continuing care retirement
31community.

32(14) The provider’s obligations to provide services to the
33resident while the resident is absent from the continuing care
34retirement community.

35(15) The conditions under which the resident must permanently
36release his or her living unit.

37(16) If real or personal properties are transferred in lieu of cash,
38a statement specifying each item’s value at the time of transfer,
39and how the value was ascertained.

P17   1(A) An itemized receipt that includes the information described
2above is acceptable if incorporated as a part of the continuing care
3 contract.

4(B) When real property is or will be transferred, the continuing
5care contract shall include a statement that the deed or other
6 instrument of conveyance shall specify that the real property is
7conveyed pursuant to a continuing care contract and may be subject
8to rescission by the transferor within 90 days from the date that
9the resident first occupies the residential unit.

10(C) The failure to comply with this paragraph shall not affect
11the validity of title to real property transferred pursuant to this
12chapter.

13(17) The amount of the entrance fee.

14(18) In the event two parties have jointly paid the entrance fee
15or other payment that allows them to occupy the unit, the
16continuing care contract shall describe how any refund of entrance
17fees is allocated.

18(19) The amount of any processing fee.

19(20) The amount of any monthly care fee.

20(21) For continuing care contracts that require a monthly care
21fee or other periodic payment, the continuing care contract shall
22include the following:

23(A) A statement that the occupancy and use of the
24accommodations by the resident is contingent upon the regular
25payment of the fee.

26(B) The regular rate of payment agreed upon (per day, week,
27or month).

28(C) A provision specifying whether payment will be made in
29advance or after services have been provided.

30(D) A provision specifying the provider will adjust monthly
31care fees for the resident’s support, maintenance, board, or lodging,
32when a resident requires medical attention while away from the
33continuing care retirement community.

34(E) A provision specifying whether a credit or allowance will
35be given to a resident who is absent from the continuing care
36retirement community or from meals. This provision shall also
37state, when applicable, that the credit may be permitted at the
38discretion or by special permission of the provider.

39(F) A statement of billing practices, procedures, and timelines.
40A provider shall allow a minimum of 14 days between the date a
P18   1bill is sent and the date payment is due. A charge for a late payment
2may only be assessed if the amount and any condition for the
3penalty is stated on the bill.

4(G) A statement that the provider is prohibited from charging
5the resident or his or her estate a monthly fee once a unit has been
6permanently vacated by the resident, unless the fee is part of an
7equity interest contract.

8(22) All continuing care contracts that include monthly care
9fees shall address changes in monthly care fees by including either
10of the following provisions:

11(A) For prepaid continuing care contracts, which include
12monthly care fees, one of the following methods:

13(i) Fees shall not be subject to change during the lifetime of the
14agreement.

15(ii) Fees shall not be increased by more than a specified number
16of dollars in any one year and not more than a specified number
17of dollars during the lifetime of the agreement.

18(iii) Fees shall not be increased in excess of a specified
19percentage over the preceding year and not more than a specified
20percentage during the lifetime of the agreement.

21(B) For monthly fee continuing care contracts, except prepaid
22contracts, changes in monthly care fees shall be based on projected
23costs, prior year per capita costs, and economic indicators.

24(23) A provision requiring that the provider give written notice
25to the resident at least 30 days in advance of any change in the
26resident’s monthly care fees or in the price or scope of any
27component of care or other services.

28(24) A provision indicating whether the resident’s rights under
29the continuing care contract include any proprietary interests in
30the assets of the provider or in the continuing care retirement
31community, or both. Any statement in a contract concerning an
32ownership interest shall appear in a large-sized font or print.

33(25) If the continuing care retirement community property is
34encumbered by a security interest that is senior to any claims the
35residents may have to enforce continuing care contracts, a provision
36shall advise the residents that any claims they may have under the
37continuing care contract are subordinate to the rights of the secured
38lender. For equity projects, the continuing care contract shall
39specify the type and extent of the equity interest and whether any
40entity holds a security interest.

P19   1(26) Notice that the living units are part of a continuing care
2retirement community that is licensed as a residential care facility
3for the elderly and, as a result, any duly authorized agent of the
4department may, upon proper identification and upon stating the
5purpose of his or her visit, enter and inspect the entire premises at
6any time, without advance notice.

7(27) A conspicuous statement, in at least 10-point boldface type
8in immediate proximity to the space reserved for the signatures of
9the resident and, if applicable, the transferor, that provides as
10follows: “You, the resident or transferor, may cancel the transaction
11without cause at any time within 90 days from the date you first
12occupy your living unit. See the attached notice of cancellation
13form for an explanation of this right.”

14(28) Notice that during the cancellation period, the continuing
15care contract may be canceled upon 30 days’ written notice by the
16provider without cause, or that the provider waives this right.

17(29) The terms and conditions under which the continuing care
18contract may be terminated after the cancellation period by either
19party, including any health or financial conditions.

20(30) A statement that, after the cancellation period, a provider
21may unilaterally terminate the continuing care contract only if the
22provider has good and sufficient cause.

23(A) Any continuing care contract containing a clause that
24provides for a continuing care contract to be terminated for “just
25cause,” “good cause,” or other similar provision, shall also include
26a provision that none of the following activities by the resident,
27or on behalf of the resident, constitutes “just cause,” “good cause,”
28or otherwise activates the termination provision:

29(i) Filing or lodging a formal complaint with the department or
30other appropriate authority.

31(ii) Participation in an organization or affiliation of residents,
32or other similar lawful activity.

33(B) The provision required by this paragraph shall also state
34that the provider shall not discriminate or retaliate in any manner
35against any resident of a continuing care retirement community
36for contacting the department, or any other state, county, or city
37agency, or any elected or appointed government official to file a
38complaint or for any other reason, or for participation in a residents’
39organization or association.

P20   1(C) Nothing in this paragraph diminishes the provider’s ability
2to terminate the continuing care contract for good and sufficient
3cause.

4(31) A statement that at least 90 days’ written notice to the
5resident is required for a unilateral termination of the continuing
6care contract by the provider.

7(32) A statement concerning the length of notice that a resident
8is required to give the provider to voluntarily terminate the
9continuing care contract after the cancellation period.

10(33) The policy or terms for refunding or repaying a lump sum
11of any portion of the entrance fee, in the event of cancellation,
12termination, or death. Every continuing care contract that provides
13for a refund or repaying a lump sum of all or a part of the entrance
14fee shall also do all of the following:

15(A) Specify the amount, if any, the resident has paid or will pay
16for upgrades, special features, or modifications to the resident’s
17unit.

18(B) State that if the continuing care contract is canceled or
19terminated by the provider, the provider shall do both of the
20following:

21(i) Amortize the specified amount at the same rate as the
22resident’s entrance fee.

23(ii) Refund the unamortized balance to the resident at the same
24time the provider pays the resident’s entrance fee refund.

25(C) State that the resident has a right to terminate his or her
26contract after 18 months of residential temporary relocation, as
27defined in paragraph (8) of subdivision (r) of Section 1771.
28Provisions for refunds due to cancellation pursuant to this
29subparagraph shall be set forth in the contract.

30(D) State the provider shall make a good-faith effort to reoccupy
31or resell a unit for which a lump-sum payment is conditioned upon
32resale of the unit. No later than July 1, 2017, a provider shall
33provide notice to all current residents with contracts applicable to
34this subparagraph regarding the statement required by this
35subparagraph as a clarification of the resident’s existing contract.

36(E) For all contracts with a repayment of all or a portion of the
37entrance fee conditioned upon the resale of the unit, the provider
38shall state the average and longest amount of time that it has taken
39to resell a unit within the last five calendar years.

40(34) The following notice at the bottom of the signatory page:


P21   2

 

    “NOTICE”

(date)

39P21   327P21  37

 

3“This is a continuing care contract as defined by paragraph (8)
4of subdivision (c), or subdivision (l) of Section 1771 of the
5California Health and Safety Code. This continuing care contract
6form has been approved by the State Department of Social Services
7as required by subdivision (b) of Section 1787 of the California
8Health and Safety Code. The basis for this approval was a
9determination that (provider name) has submitted a contract that
10complies with the minimum statutory requirements applicable to
11continuing care contracts. The department does not approve or
12disapprove any of the financial or health care coverage provisions
13in this contract. Approval by the department is NOT a guaranty
14of performance or an endorsement of any continuing care contract
15provisions. Prospective transferors and residents are strongly
16encouraged to carefully consider the benefits and risks of this
17continuing care contract and to seek financial and legal advice
18before signing.”

19(35) The provider may not attempt to absolve itself in the
20continuing care contract from liability for its negligence by any
21statement to that effect, and shall include the following statement
22in the contract: “Nothing in this continuing care contract limits
23either the provider’s obligation to provide adequate care and
24supervision for the resident or any liability on the part of the
25provider which may result from the provider’s failure to provide
26this care and supervision.”

27(36) Provisions describing how the provider will proceed in the
28event of a closure, including an explanation of how the provider
29will comply with Sections 1793.80, 1793.81, 1793.82, and 1793.83.

30(b) A life care contract shall also provide that:

31(1) All levels of care, including acute care and physicians’ and
32surgeons’ services, will be provided to a resident.

33(2) Care will be provided for the duration of the resident’s life
34unless the life care contract is canceled or terminated by the
35provider during the cancellation period or after the cancellation
36period for good cause.

37(3) A comprehensive continuum of care will be provided to the
38resident, including skilled nursing, in a facility under the ownership
39and supervision of the provider on, or adjacent to, the continuing
40care retirement community premises.

P22   1(4) Monthly care fees will not be changed based on the resident’s
2level of care or service.

3(5) A resident who becomes financially unable to pay his or her
4monthly care fees shall be subsidized provided the resident’s
5financial need does not arise from action by the resident to divest
6the resident of his or her assets.

7(c) Continuing care contracts may include provisions that do
8any of the following:

9(1) Subsidize a resident who becomes financially unable to pay
10for his or her monthly care fees at some future date. If a continuing
11care contract provides for subsidizing a resident, it may also
12provide for any of the following:

13(A) The resident shall apply for any public assistance or other
14aid for which he or she is eligible and that the provider may apply
15for assistance on behalf of the resident.

16(B) The provider’s decision shall be final and conclusive
17regarding any adjustments to be made or any action to be taken
18regarding any charitable consideration extended to any of its
19residents.

20(C) The provider is entitled to payment for the actual costs of
21care out of any property acquired by the resident subsequent to
22any adjustment extended to the resident under this paragraph, or
23from any other property of the resident that the resident failed to
24disclose.

25(D) The provider may pay the monthly premium of the resident’s
26health insurance coverage under Medicare to ensure that those
27payments will be made.

28(E) The provider may receive an assignment from the resident
29of the right to apply for and to receive the benefits, for and on
30behalf of the resident.

31(F) The provider is not responsible for the costs of furnishing
32the resident with any services, supplies, and medication, when
33reimbursement is reasonably available from any governmental
34agency, or any private insurance.

35(G) Any refund due to the resident at the termination of the
36continuing care contract may be offset by any prior subsidy to the
37resident by the provider.

38(2) Limit responsibility for costs associated with the treatment
39or medication of an ailment or illness existing prior to the date of
40admission. In these cases, the medical or surgical exceptions, as
P23   1disclosed by the medical entrance examination, shall be listed in
2the continuing care contract or in a medical report attached to and
3made a part of the continuing care contract.

4(3) Identify legal remedies that may be available to the provider
5if the resident makes any material misrepresentation or omission
6pertaining to the resident’s assets or health.

7(4) Restrict transfer or assignments of the resident’s rights and
8privileges under a continuing care contract due to the personal
9nature of the continuing care contract.

10(5) Protect the provider’s ability to waive a resident’s breach
11of the terms or provisions of the continuing care contract in specific
12instances without relinquishing its right to insist upon full
13compliance by the resident with all terms or provisions in the
14contract.

15(6) Provide that the resident shall reimburse the provider for
16any uninsured loss or damage to the resident’s unit, beyond normal
17wear and tear, resulting from the resident’s carelessness or
18negligence.

19(7) Provide that the resident agrees to observe the off-limit areas
20of the continuing care retirement community designated by the
21provider for safety reasons. The provider may not include any
22provision in a continuing care contract that absolves the provider
23from liability for its negligence.

24(8) Provide for the subrogation to the provider of the resident’s
25rights in the case of injury to a resident caused by the acts or
26omissions of a third party, or for the assignment of the resident’s
27recovery or benefits in this case to the provider, to the extent of
28the value of the goods and services furnished by the provider to
29or on behalf of the resident as a result of the injury.

30(9) Provide for a lien on any judgment, settlement, or recovery
31for any additional expense incurred by the provider in caring for
32the resident as a result of injury.

33(10) Require the resident’s cooperation and assistance in the
34diligent prosecution of any claim or action against any third party.

35(11) Provide for the appointment of a conservator or guardian
36by a court with jurisdiction in the event a resident becomes unable
37to handle his or her personal or financial affairs.

38(12) Allow a provider, whose property is tax exempt, to charge
39the resident, on a pro rata basis, property taxes, or in-lieu taxes,
40that the provider is required to pay.

P24   1(13) Make any other provision approved by the department.

2(d) A copy of the resident’s rights as described in Section 1771.7
3shall be attached to every continuing care contract.

4(e) A copy of the current audited financial statement of the
5provider shall be attached to every continuing care contract. For
6a provider whose current audited financial statement does not
7accurately reflect the financial ability of the provider to fulfill the
8continuing care contract obligations, the financial statement
9attached to the continuing care contract shall include all of the
10following:

11(1) A disclosure that the reserve requirement has not yet been
12determined or met, and that entrance fees will not be held in
13escrow.

14(2) A disclosure that the ability to provide the services promised
15in the continuing care contract will depend on successful
16compliance with the approved financial plan.

17(3) A copy of the approved financial plan for meeting the reserve
18requirements.

19(4) Any other supplemental statements or attachments necessary
20to accurately represent the provider’s financial ability to fulfill its
21continuing care contract obligations.

22(f) A schedule of the average monthly care fees charged to
23residents for each type of residential living unit for each of the five
24years preceding execution of the continuing care contract shall be
25attached to every continuing care contract. The provider shall
26update this schedule annually at the end of each fiscal year. If the
27continuing care retirement community has not been in existence
28for five years, the information shall be provided for each of the
29years the continuing care retirement community has been in
30existence.

31(g) If any continuing care contract provides for a health
32insurance policy for the benefit of the resident, the provider shall
33attach to the continuing care contract a binder complying with
34Sections 382 and 382.5 of the Insurance Code.

35(h) The provider shall attach to every continuing care contract
36a completed form in duplicate, captioned “Notice of Cancellation.”
37The notice shall be easily detachable, and shall contain, in at least
3810-point boldface type, the following statement:

 

“NOTICE OF CANCELLATION”

(date)

Your first date of occupancy under this contract   

is: _____________________________________________

P21   327P21  37

 

4“You may cancel this transaction, without any penalty within
590 calendar days from the above date.

6If you cancel, any property transferred, any payments made by
7you under the contract, and any negotiable instrument executed
8by you will be returned within 14 calendar days after making
9possession of the living unit available to the provider. Any security
10interest arising out of the transaction will be canceled.

11If you cancel, you are obligated to pay a reasonable processing
12 fee to cover costs and to pay for the reasonable value of the services
13received by you from the provider up to the date you canceled or
14made available to the provider the possession of any living unit
15delivered to you under this contract, whichever is later.

16If you cancel, you must return possession of any living unit
17delivered to you under this contract to the provider in substantially
18the same condition as when you took possession.

19Possession of the living unit must be made available to the
20provider within 20 calendar days of your notice of cancellation.
21If you fail to make the possession of any living unit available to
22the provider, then you remain liable for performance of all
23obligations under the contract.

24To cancel this transaction, mail or deliver a signed and dated
25copy of this cancellation notice, or any other written notice, or
26send a telegram

 

to   

(Name of provider)

at   

(Address of provider’s place of business)

not later than midnight of _____________ (date).

I hereby cancel this
transaction


   

(Resident’s or
Transferor’s signature)”

P21  37

 

38

SEC. 3.  

Section 1788.4 of the Health and Safety Code is
39amended to read:

P26   1

1788.4.  

(a)  During the cancellation period, the provider shall
2pay all refunds owed to a resident within 14 calendar days after a
3resident makes possession of the living unit available to the
4provider.

5(b)  After the cancellation period, any refunds due to a resident
6under a continuing care contract shall be paid within 14 calendar
7days after a resident makes possession of the living unit available
8to the provider or 90 calendar days after death or receipt of notice
9of termination, whichever is later.

10(c)  In nonequity projects, if the continuing care contract is
11canceled by either party during the cancellation period or
12terminated by the provider after the cancellation period, the resident
13shall be refunded the difference between the total amount of
14entrance, monthly, and optional fees paid and the amount used for
15care of the resident.

16(d)  If a resident has paid additional amounts for upgrades,
17special features, or modifications to the living unit and the provider
18terminates the resident’s continuing care contract, the provider
19shall amortize those additional amounts at the same rate as the
20entrance fee and shall refund the unamortized balance to the
21resident.

22(e)  A lump-sum payment to a resident after termination of a
23continuing care contract that is conditioned upon resale of the unit
24shall not be considered to be a refund and may not be characterized
25or advertised as a refund. The fullbegin delete lump-sum paymentend deletebegin insert lump sum
26owed, including any interest accrued,end insert
shall be paid to the resident
27within 14 calendar days after resale of the unit.

28(f) (1) For contracts signed on and after January 1, 2017,
29notwithstanding a provider’s documented good-faith effort to resell
30the unit, the resident is entitled to the repayment of a specified
31portion, pursuant to subparagraphs (A) and (B), of the full
32begin delete lump-sum paymentend deletebegin insert lump sum owedend insert if the unit remains vacant 120
33days after the resident’s termination of the contract. This repayment
34shall not cause the contract in question to be deemed a refundable
35contract, as defined in paragraph (2) of subdivision (r) of Section
361771.

37(A) When a continuing care contract is terminated by the death
38of a resident, at least 10 percent of the fullbegin delete lump-sum paymentend delete
39begin insert lump sum owedend insert shall be paid to the resident’s estate within 120
40days after the death of the resident.

P27   1(B) When a continuing care contract is terminated for a reason
2not described in subparagraph (A), at least 20 percent of the full
3begin delete lump-sum paymentend deletebegin insert lump sum owedend insert shall be paid to the resident
4within 120 days after the resident’s termination of the contract.

5(2) Anybegin delete paymentend delete balancebegin insert of the lump sum owedend insert that has not
6been paid to the resident within 180 days shall accrue interest at
7a rate calculated pursuant to paragraph (3). Anybegin delete paymentend delete balance
8begin insert of the lump sum owedend insert that has not been paid to the resident within
9240 days shall accrue interest at a rate calculated pursuant to
10paragraph (4). Interest shall continue to accruebegin insert annually pursuant
11to paragraph (5)end insert
until the date the fullbegin delete lump-sum paymentend deletebegin insert lump
12sum owedend insert
is paid to the resident. This paragraph shall apply only
13to continuing care contracts entered into on or after January 1,
142017.

15(3) Anybegin delete paymentsend deletebegin insert amount owedend insert thatbegin delete areend deletebegin insert isend insert not paid to the
16resident within the 180-day period pursuant to paragraph (2) shall
17accrue simplebegin delete interest, to be compounded annually,end deletebegin insert interestend insert at a
18rate of 4begin delete percent.end deletebegin insert percent of the amount owed.end insert

19(4) Anybegin delete paymentsend deletebegin insert amount owedend insert thatbegin delete areend deletebegin insert isend insert not paid to the
20resident within the 240-day period pursuant to paragraph (2) shall
21accrue simplebegin delete interest, to be compounded annually,end deletebegin insert interestend insert at a
22rate of 6begin delete percent.end deletebegin insert percent of the amount owed.end insert

begin insert

23
(5) Any amount owed that is not paid to the resident within one
24year after the 240-day period pursuant to paragraph (4) shall
25accrue compound interest annually at a rate of 6 percent.

end insert
begin delete

26(5)

end delete

27begin insert(6)end insert Until January 1, 2018, this subdivision shall not apply to a
28project that is in development prior to January 1, 2017, including
29current repayable agreements, current deposit agreements that
30contemplate repayable entrance fees, and other projects that have
31received department approval to market units pursuant to Section
321771.4, or have received issuer, lender, or bond insurer approval
33to obtain bond financing, or other governmental approval based
34on a repayable entrance fee option, if the initial contract for the
35project is entered into on or before January 1, 2018.

36(g) (1) After the death of a resident, abegin delete lump-sum paymentend deletebegin insert lump
37sum owedend insert
that is conditioned upon resale of a unit shall be subject
38to subdivision (f) and thebegin delete payment and interest, if any,end deletebegin insert lump sum
39owed shall include any interest accrued andend insert
shall be payable to
40the resident’s estate.

P28   1(2) Until January 1, 2018, this subdivision shall not apply to a
2project that is in development prior to January 1, 2017, including
3current repayable agreements, current deposit agreements that
4contemplate repayable entrance fees, and other projects that have
5received department approval to market units pursuant to Section
61771.4, or have received issuer, lender, or bond insurer approval
7to obtain bond financing, or other governmental approval based
8on a repayable entrance fee option, if the initial contract for the
9project is entered into on or before January 1, 2018.

10(h) Except as otherwise obligated by an equity interest contract,
11once the unit has been vacated and made available to the provider,
12the provider shall not make any further charges to the resident or
13his or her estate or charges against thebegin delete lump-sum payment that is
14dueend delete
begin insert lump sum owedend insert to the resident for purposes of continued
15monthly payments to the provider or for maintenance or
16housekeeping on the vacated unit.

17(i) Nothing in this section shall be construed to limit or alter
18any legal remedies otherwise available to a resident or his or her
19estate.



O

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