LCO No. 3343 1 of 7
General Assembly Raised Bill No. 5481
February Session, 2022
LCO No. 3343
Referred to Committee on PUBLIC HEALTH
Introduced by:
(PH)
AN ACT CONCERNING THE DEPARTMENT OF PUBLIC HEALTH'S
RECOMMENDATIONS REGARDING CHANGE OF OWNERSHIP IN
HEALTH CARE FACILITIES.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Section 19a-493 of the 2022 supplement to the general 1
statutes is repealed and the following is substituted in lieu thereof 2
(Effective July 1, 2022): 3
(a) Upon receipt of an application for an initial license, the 4
Department of Public Health, subject to the provisions of section 19a-5
491a, shall issue such license if, upon conducting a scheduled inspection 6
and investigation, the department finds that the applicant and facilities 7
meet the requirements established under section 19a-495, provided a 8
license shall be issued to or renewed for an institution, as defined in 9
section 19a-490, only if such institution is not otherwise required to be 10
licensed by the state. If an institution, as defined in subsections (b), (d), 11
(e) and (f) of section 19a-490, applies for license renewal and has been 12
certified as a provider of services by the United States Department of 13
Health and Human Services under Medicare or Medicaid programs 14 Raised Bill No. 5481
LCO No. 3343 2 of 7
within the immediately preceding twelve-month period, or if an 15
institution, as defined in subsection (b) of section 19a-490, is currently 16
certified, the commissioner or the commissioner's designee may waive 17
on renewal the inspection and investigation of such facility required by 18
this section and, in such event, any such facility shall be deemed to have 19
satisfied the requirements of section 19a-495 for the purposes of 20
licensure. Such license shall be valid for two years or a fraction thereof 21
and shall terminate on March thirty-first, June thirtieth, September 22
thirtieth or December thirty-first of the appropriate year. A license 23
issued pursuant to this chapter, unless sooner suspended or revoked, 24
shall be renewable biennially (1) after an unscheduled inspection is 25
conducted by the department, and (2) upon the filing by the licensee, 26
and approval by the department, of a report upon such date and 27
containing such information in such form as the department prescribes 28
and satisfactory evidence of continuing compliance with requirements 29
established under section 19a-495. In the case of an institution, as 30
defined in subsection (d) of section 19a-490, that is also certified as a 31
provider under the Medicare program, the license shall be issued for a 32
period not to exceed three years, to run concurrently with the 33
certification period. In the case of an institution, as defined in subsection 34
(m) of section 19a-490, that is applying for renewal, the license shall be 35
issued pursuant to section 19a-491. Except in the case of a multicare 36
institution, each license shall be issued only for the premises and 37
persons named in the application. Such license shall not be transferable 38
or assignable. Licenses shall be posted in a conspicuous place in the 39
licensed premises. 40
(b) [(1)] A nursing home license may be renewed biennially after [(A)] 41
(1) an unscheduled inspection conducted by the department, [(B)] (2) 42
submission of the information required by section 19a-491a, and [(C)] 43
(3) submission of evidence satisfactory to the department that the 44
nursing home is in compliance with the provisions of this chapter, the 45
regulations of Connecticut state agencies and licensing regulations. 46
[(2)] (c) (1) For the purposes of this subsection, "facility" and 47
"institution" have the same meanings as provided in section 19a-490. 48 Raised Bill No. 5481
LCO No. 3343 3 of 7
Any change in the ownership of a facility or institution [, as defined in 49
section 19a-490,] owned by an individual, partnership or association or 50
the change in ownership or beneficial ownership of [ten per cent or more 51
of the stock of a corporation] the entity which owns, conducts, operates 52
or maintains such facility or institution, including a change in 53
ownership or beneficial ownership resulting in a transfer to a person 54
related by blood or marriage to such an owner or beneficial owner, shall 55
be subject to prior approval of the department. [after a scheduled 56
inspection of such facility or institution is conducted by the department, 57
provided such approval shall be conditioned upon a showing by such 58
facility or institution to the commissioner that it has complied with all 59
requirements of this chapter, the regulations relating to licensure and all 60
applicable requirements of the regulations of Connecticut state agencies. 61
Any such change in ownership or beneficial ownership resulting in a 62
transfer to a person related by blood or marriage to such an owner or 63
beneficial owner shall not be subject to prior approval of the department 64
unless: (A) Ownership or beneficial ownership of ten per cent or more 65
of the stock of a corporation, limited liability company, partnership or 66
association which owns, conducts, operates or maintains more than one 67
facility or institution is transferred; (B) ownership or beneficial 68
ownership is transferred in more than one facility or institution; or (C) 69
the facility or institution is the subject of a pending complaint, 70
investigation or licensure action. If the facility or institution is not in 71
compliance, the commissioner may require the new owner to sign a 72
consent order providing reasonable assurances that the violations shall 73
be corrected within a specified period of time. Notice of any such 74
proposed change of ownership shall be given to the department at least 75
one hundred twenty days prior to the effective date of such proposed 76
change.] 77
(2) Not later than one hundred twenty days before the proposed date 78
of a change in ownership of a facility or institution, the proposed new 79
owner of such facility or institution shall submit an application for 80
approval to the department pursuant to subdivision (1) of this 81
subsection. Such application shall be in a form and manner prescribed 82 Raised Bill No. 5481
LCO No. 3343 4 of 7
by the commissioner and shall include, but need not be limited to, the 83
following: (A) A cover letter stating the applicant's intent to purchase 84
the facility or institution and identification of the facility or institution 85
by name, address, county and number and type of beds licensed by the 86
department; (B) a description of the proposed transaction, including the 87
name of each current owner of the facility or institution; (C) the name of 88
each proposed new owner; (D) the name of each owner of any 89
nonpublicly traded parent corporation of each proposed new owner; (E) 90
if applicable, the proposed new owner's organizational chart, such 91
proposed new owner's parent corporation's organizational chart, and 92
the organizational chart of each wholly-owned subsidiary of such 93
proposed new owner; (F) a copy of the agreement of sale and, if 94
applicable, a copy of any lease or management agreements; (G) a 95
projection of profits and losses and a capital budget projection, 96
including, but not limited to, accounts payable with amount due, days 97
overdue and details of payment to all such accounts, for the three years 98
following the change in ownership, (H) the name and address of any 99
licensed health care facility owned, operated or managed by each 100
proposed owner in the United States or any territory of the United States 101
during the five years preceding the date on which such application is 102
submitted and audited financial statements for each such facility for the 103
three years preceding the date on which such application is submitted; 104
(I) disclosure of any direct or indirect interests, including such interests 105
in intermediate entities and parent, management and property 106
companies and other related entities; (J) a statement that the facility or 107
institution is not the subject of a pending complaint, investigation or 108
licensure action in the state or reciprocal action in another state; (K) 109
disclosure of whether the facility or institution has been subject to (i) 110
three or more civil penalties imposed through final order of the 111
commissioner in accordance with the provisions of sections 19a-524 to 112
19a-528, inclusive, or civil penalties imposed pursuant to the laws or 113
regulations of another state during the two-year period preceding the 114
date on which such application is submitted, or (ii) sanctions, other than 115
civil penalties less than or equal to twenty thousand dollars, imposed in 116
any state through final adjudication under the Medicare or Medicaid 117 Raised Bill No. 5481
LCO No. 3343 5 of 7
program pursuant to Title XVIII or XIX of the federal Social Security Act, 118
42 USC 301, as amended from time to time; and (L) disclosure of 119
whether any proposed new owner's Medicare or Medicaid provider 120
agreement has been terminated or not renewed in any state. For the 121
purposes of this subdivision, "organizational chart" means a graphical 122
representation of an organization, including, but not limited to, the 123
relationships between such organization's employees, departments and 124
the jobs within such organization. 125
(3) After receiving an application, the department shall schedule an 126
inspection of such facility or institution to determine if the facility or 127
institution has complied with the requirements of this chapter and the 128
regulations of Connecticut state agencies relating to licensure of such 129
facility or institution. If an applicant is not in compliance with the 130
requirements of a corrective action plan or in violation of any provision 131
of the general statutes or the regulations of Connecticut state agencies, 132
the commissioner may deny the applicant's change in ownership or 133
require the proposed new owner to sign a consent order, which shall 134
include, but need not be limited to, the implementation of a corrective 135
action plan for any such violation within a specified time period. The 136
commissioner may assess a civil penalty of not more than one thousand 137
dollars for each day the owner of the facility or institution is in violation 138
of any provision of the general statutes or the regulations of Connecticut 139
state agencies or such consent order. If the commissioner disapproves a 140
change in ownership, a person related by blood or marriage to the 141
applicant may not apply to acquire ownership interest in the facility or 142
institution. For the purposes of this subdivision, "a person related by 143
blood or marriage" means a parent, spouse, child, brother, sister, aunt, 144
uncle, niece or nephew. 145
(4) For the purposes of this [subdivision] subsection, a change in the 146
legal form of the ownership entity, including, but not limited to, changes 147
from a corporation to a limited liability company, a partnership to a 148
limited liability partnership, a sole proprietorship to a corporation and 149
similar changes, shall not be considered a change of ownership if the 150
beneficial ownership remains unchanged and the owner provides such 151 Raised Bill No. 5481
LCO No. 3343 6 of 7
information regarding the change to the department as may be required 152
by the department in order to properly identify the current status of 153
ownership and beneficial ownership of the facility or institution. For the 154
purposes of this subdivision, a public offering of the stock of any 155
corporation that owns, conducts, operates or maintains any such facility 156
or institution shall not be considered a change in ownership or beneficial 157
ownership of such facility or institution if the licensee and the officers 158
and directors of such corporation remain unchanged, such public 159
offering cannot result in an individual or entity owning ten per cent or 160
more of the stock of such corporation, and the owner provides such 161
information to the department as may be required by the department in 162
order to properly identify the current status of ownership and beneficial 163
ownership of the facility or institution. 164
[(c)] (d) (1) A multicare institution may, under the terms of its existing 165
license, provide behavioral health services or substance use disorder 166
treatment services on the premises of more than one facility, at a satellite 167
unit or at another location outside of its facilities or satellite units that is 168
acceptable to the patient receiving services and is consistent with the 169
patient's assessment and treatment plan. Such behavioral health 170
services or substance use disorder treatment services may include 171
methadone delivery and related substance use treatment services to 172
persons in a nursing home facility pursuant to the provisions of section 173
19a-495c. 174
(2) Any multicare institution that intends to offer services at a satellite 175
unit or other location outside of its facilities or satellite units shall submit 176
an application for approval to offer services at such location to the 177
Department of Public Health. Such application shall be submitted on a 178
form and in the manner prescribed by the Commissioner of Public 179
Health. Not later than forty-five days after receipt of such application, 180
the commissioner shall notify the multicare institution of the approval 181
or denial of such application. If the satellite unit or other location is 182
approved, that satellite unit or location shall be deemed to be licensed 183
in accordance with this section and shall comply with the applicable 184
requirements of this chapter and regulations adopted under this 185 Raised Bill No. 5481
LCO No. 3343 7 of 7
chapter. 186
(3) A multicare institution that is a hospital providing outpatient 187
behavioral health services or other health care services shall provide the 188
Department of Public Health with a list of satellite units or locations 189
when completing the initial or renewal licensure application. 190
(4) The Commissioner of Public Health may adopt regulations, in 191
accordance with the provisions of chapter 54, to carry out the provisions 192
of this subsection. The Commissioner of Public Health may implement 193
policies and procedures necessary to administer the provisions of this 194
subsection while in the process of adopting such policies and 195
procedures as regulation, provided the commissioner prints notice of 196
intent to adopt regulations in the Connecticut Law Journal not later than 197
twenty days after the date of implementation. Policies and procedures 198
implemented pursuant to this section shall be valid until the time final 199
regulations are adopted. 200
This act shall take effect as follows and shall amend the following
sections:
Section 1 July 1, 2022 19a-493
Statement of Purpose:
To (1) expand the circumstances in which a change in ownership of a
health care facility or institution requires approval by the Department
of Public Health; and (2) establish an application process for the
approval of changes in ownership of health care facilities and
institutions.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
underlined.]