California Senate Bill SB648 Amended / Bill

 BILL NUMBER: SB 648AMENDED 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.