BILL ANALYSIS
AB 1433
Page 1
Date of Hearing: January 12, 2010
ASSEMBLY COMMITTEE ON HUMAN SERVICES
Jim Beall, Jr., Chair
AB 1433 (Eng and Beall) - As Amended: January 4, 2010
SUBJECT : Continuing care contracts: temporary relocation
SUMMARY : Defines residential temporary relocation of continuing
care retirement community (CCRC) residents and requires
continuing care contracts to state the right of CCRC residents
to terminate the contract after 18 months of a temporary
relocation. Specifically, this bill :
1)Defines a "residential temporary relocation" to mean the
relocation of one or more residents, except in the case of a
natural disaster that is out of the provider's control, from
one or more residential living units, assisted living units,
skilled nursing units, or a wing, floor or entire CCRC due to
a change of use or major repairs or renovations.
2)Further defines "temporary" relocation to mean a relocation
that lasts for a period of at least nine months but does not
exceed 18 months without the written agreement of the
resident.
3)Requires that a continuing care contract state that the
resident has a right to terminate his or her contract after 18
months of residential temporary relocation, and that the
contract have provisions related to monthly fee and entrance
fee refunds upon termination of the contract for this reason.
EXISTING LAW
1)Provides for the regulation by the Department of Social
Services (DSS) of activities relating to continuing care
contracts that govern care provided to elderly residents in
CCRCs for the duration of the resident's life or a term in
excess of one year.
2)Defines "permanent closure" of a CCRC as the voluntary or
involuntary termination or forfeiture of a provider's
certificate of authority or license or other action that
results in the permanent relocation of residents, except in
the case of a natural disaster or other event out of the
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provider's control.
3)Provides for notice to residents of a "permanent closure" of a
CCRC and regulates the permanent closure of CCRCs, including
as follows:
a) Requires that continuing care contracts include
provisions describing how the provider will proceed in the
event of a closure;
b) Requires that CCRCs provide written notice to DSS and to
the affected residents or designated representatives of the
affected residents 120 days prior to the intended date of
closure of a continuing care retirement community;
c) Requires closure notices to include the intended date of
closure and the requirement of a relocation plan;
d) Requires that providers offer a resident a choice of
specified placement options, the terms of which shall not
be less than the terms of the continuing care contract
between the resident and the provider as if that contract
had been fully performed;
e) Requires that providers, within 30 days of submitting
the relocation plan for a permanent closure, fund a
reserve, set up a trust fund, or secure a performance bond
to ensure fulfillment of costs associated with the
relocation, in an amount equal to or greater than the
estimated costs of relocating residents and relocation
options, funded with qualifying assets not subject to any
liens, judgments, garnishments or creditor's claims;
f) Requires that providers submit monthly progress reports
to DSS detailing the progress and problems associated with
the closure until all affected residents are relocated and
all required payments are made;
g) Requires DSS monitor the implementation of the closure
and impose penalties if DSS determines that a provider is
closing a facility in violation of the permanent closure
requirements or is doing so in a manner that endangers the
health or safety of residents; and,
h) Prohibits the provider from displacing any resident or
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to close the facility until the relocation plan has been
prepared and submitted to DSS and provided to the affected
residents, the affected residents' representatives, and the
local long-term care ombudsman program.
FISCAL EFFECT : Unknown
COMMENTS : A continuing care retirement community is a community
where services promised in a continuing care contract are
provided. Continuing care retirement communities can be
apartment-type dwellings, high-rise buildings, a subdivision
setting, or any other housing design. Most continuing care
communities have three levels of care: indpendent living,
assisted living and skilled nursing care. As a resident's needs
increase, he or she moves to a higher level of care within the
facility.
A prior bill, AB 407 (Beall and Eng), Chapter 442, Statutes of
2009, established requirements for the permanent closure of a
CCRC. Prior to AB 407, while the law regulated the
establishment and operation of CCRCs, there were minimal
regulations governing what happens when a facility must close.
The authors of this bill report that AB 407, as introduced,
addressed both permanent and temporary closures. Due to
provider concerns over prevailing economic conditions, however,
AB 407 was amended to address only permanent closures. AB 407
passed with no opposition and no negative votes in either house.
The joint authors of both AB 407 and this bill note that they
and stakeholder organizations representing CCRC providers and
CCRC residents agreed to address temporary closures--or,
residential temporary relocations--this year. This bill is the
result of that agreement.
This bill establishes guidelines for continuing care contracts
and for protecting CCRC residents' rights during a remodel,
renovation, or rebuilding of a CCRC or part of a CCRC that will
temporarily displace residents. This bill requires that
continuing care contracts provide that a resident has the right
to terminate his or her contract if a residential temporary
relocation exceeds 18 months. This bill further requires that
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the contract provide for the refund of monthly and entrance fees
if the contract is terminated.
REGISTERED SUPPORT / OPPOSITION :
Support
Aging Services of California
Opposition
None on file.
Analysis Prepared by : Eric Gelber / HUM. S. / (916) 319-2089