Connecticut 2022 Regular Session

Connecticut House Bill HB05481 Compare Versions

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7-General Assembly Substitute Bill No. 5481
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6+General Assembly Raised Bill No. 5481
87 February Session, 2022
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11+Referred to Committee on PUBLIC HEALTH
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14+Introduced by:
15+(PH)
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1420 AN ACT CONCERNING THE DEPARTMENT OF PUBLIC HEALTH'S
1521 RECOMMENDATIONS REGARDING CHANGE OF OWNERSHIP IN
1622 HEALTH CARE FACILITIES.
1723 Be it enacted by the Senate and House of Representatives in General
1824 Assembly convened:
1925
2026 Section 1. Section 19a-493 of the 2022 supplement to the general 1
2127 statutes is repealed and the following is substituted in lieu thereof 2
2228 (Effective July 1, 2022): 3
2329 (a) Upon receipt of an application for an initial license, the 4
2430 Department of Public Health, subject to the provisions of section 19a-5
2531 491a, shall issue such license if, upon conducting a scheduled inspection 6
2632 and investigation, the department finds that the applicant and facilities 7
2733 meet the requirements established under section 19a-495, provided a 8
2834 license shall be issued to or renewed for an institution, as defined in 9
2935 section 19a-490, only if such institution is not otherwise required to be 10
3036 licensed by the state. If an institution, as defined in subsections (b), (d), 11
3137 (e) and (f) of section 19a-490, applies for license renewal and has been 12
3238 certified as a provider of services by the United States Department of 13
33-Health and Human Services under Medicare or Medicaid programs 14
39+Health and Human Services under Medicare or Medicaid programs 14 Raised Bill No. 5481
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3445 within the immediately preceding twelve-month period, or if an 15
3546 institution, as defined in subsection (b) of section 19a-490, is currently 16
36-certified, the commissioner or the commissioner's designee may waive 17 Substitute Bill No. 5481
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47+certified, the commissioner or the commissioner's designee may waive 17
4348 on renewal the inspection and investigation of such facility required by 18
4449 this section and, in such event, any such facility shall be deemed to have 19
4550 satisfied the requirements of section 19a-495 for the purposes of 20
4651 licensure. Such license shall be valid for two years or a fraction thereof 21
4752 and shall terminate on March thirty-first, June thirtieth, September 22
4853 thirtieth or December thirty-first of the appropriate year. A license 23
4954 issued pursuant to this chapter, unless sooner suspended or revoked, 24
5055 shall be renewable biennially (1) after an unscheduled inspection is 25
5156 conducted by the department, and (2) upon the filing by the licensee, 26
5257 and approval by the department, of a report upon such date and 27
5358 containing such information in such form as the department prescribes 28
5459 and satisfactory evidence of continuing compliance with requirements 29
5560 established under section 19a-495. In the case of an institution, as 30
5661 defined in subsection (d) of section 19a-490, that is also certified as a 31
5762 provider under the Medicare program, the license shall be issued for a 32
5863 period not to exceed three years, to run concurrently with the 33
5964 certification period. In the case of an institution, as defined in subsection 34
6065 (m) of section 19a-490, that is applying for renewal, the license shall be 35
6166 issued pursuant to section 19a-491. Except in the case of a multicare 36
6267 institution, each license shall be issued only for the premises and 37
6368 persons named in the application. Such license shall not be transferable 38
6469 or assignable. Licenses shall be posted in a conspicuous place in the 39
6570 licensed premises. 40
6671 (b) [(1)] A nursing home license may be renewed biennially after [(A)] 41
6772 (1) an unscheduled inspection conducted by the department, [(B)] (2) 42
6873 submission of the information required by section 19a-491a, and [(C)] 43
6974 (3) submission of evidence satisfactory to the department that the 44
7075 nursing home is in compliance with the provisions of this chapter, the 45
7176 regulations of Connecticut state agencies and licensing regulations. 46
72-[(2)] (c) (1) For the purposes of this subsection, "facility" means any 47
73-facility licensed by the Department of Public Health pursuant to chapter 48
74-368v and "institution" has the same meaning as provided in section 19a-49
75-490. Any change in the ownership of a facility or institution [, as defined 50 Substitute Bill No. 5481
77+[(2)] (c) (1) For the purposes of this subsection, "facility" and 47
78+"institution" have the same meanings as provided in section 19a-490. 48 Raised Bill No. 5481
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82-in section 19a-490,] owned by an individual, partnership or association 51
83-or the change in ownership or beneficial ownership of [ten per cent or 52
84-more of the stock of a corporation] the entity which owns, conducts, 53
85-operates or maintains such facility or institution, including a change in 54
86-ownership or beneficial ownership resulting in a transfer to a person 55
87-related by blood or marriage to such an owner or beneficial owner, shall 56
88-be subject to prior approval of the department. [after a scheduled 57
89-inspection of such facility or institution is conducted by the department, 58
90-provided such approval shall be conditioned upon a showing by such 59
91-facility or institution to the commissioner that it has complied with all 60
92-requirements of this chapter, the regulations relating to licensure and all 61
93-applicable requirements of the regulations of Connecticut state agencies. 62
94-Any such change in ownership or beneficial ownership resulting in a 63
95-transfer to a person related by blood or marriage to such an owner or 64
96-beneficial owner shall not be subject to prior approval of the department 65
97-unless: (A) Ownership or beneficial ownership of ten per cent or more 66
98-of the stock of a corporation, limited liability company, partnership or 67
99-association which owns, conducts, operates or maintains more than one 68
100-facility or institution is transferred; (B) ownership or beneficial 69
101-ownership is transferred in more than one facility or institution; or (C) 70
102-the facility or institution is the subject of a pending complaint, 71
103-investigation or licensure action. If the facility or institution is not in 72
104-compliance, the commissioner may require the new owner to sign a 73
105-consent order providing reasonable assurances that the violations shall 74
106-be corrected within a specified period of time. Notice of any such 75
107-proposed change of ownership shall be given to the department at least 76
108-one hundred twenty days prior to the effective date of such proposed 77
109-change.] 78
110-(2) Not later than one hundred twenty days before the proposed date 79
111-of a change in ownership of a facility or institution, the proposed new 80
112-owner of such facility or institution shall submit an application for 81
113-approval to the department pursuant to subdivision (1) of this 82
114-subsection. Such application shall be in a form and manner prescribed 83
115-by the commissioner and shall include, but need not be limited to, the 84 Substitute Bill No. 5481
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84+Any change in the ownership of a facility or institution [, as defined in 49
85+section 19a-490,] owned by an individual, partnership or association or 50
86+the change in ownership or beneficial ownership of [ten per cent or more 51
87+of the stock of a corporation] the entity which owns, conducts, operates 52
88+or maintains such facility or institution, including a change in 53
89+ownership or beneficial ownership resulting in a transfer to a person 54
90+related by blood or marriage to such an owner or beneficial owner, shall 55
91+be subject to prior approval of the department. [after a scheduled 56
92+inspection of such facility or institution is conducted by the department, 57
93+provided such approval shall be conditioned upon a showing by such 58
94+facility or institution to the commissioner that it has complied with all 59
95+requirements of this chapter, the regulations relating to licensure and all 60
96+applicable requirements of the regulations of Connecticut state agencies. 61
97+Any such change in ownership or beneficial ownership resulting in a 62
98+transfer to a person related by blood or marriage to such an owner or 63
99+beneficial owner shall not be subject to prior approval of the department 64
100+unless: (A) Ownership or beneficial ownership of ten per cent or more 65
101+of the stock of a corporation, limited liability company, partnership or 66
102+association which owns, conducts, operates or maintains more than one 67
103+facility or institution is transferred; (B) ownership or beneficial 68
104+ownership is transferred in more than one facility or institution; or (C) 69
105+the facility or institution is the subject of a pending complaint, 70
106+investigation or licensure action. If the facility or institution is not in 71
107+compliance, the commissioner may require the new owner to sign a 72
108+consent order providing reasonable assurances that the violations shall 73
109+be corrected within a specified period of time. Notice of any such 74
110+proposed change of ownership shall be given to the department at least 75
111+one hundred twenty days prior to the effective date of such proposed 76
112+change.] 77
113+(2) Not later than one hundred twenty days before the proposed date 78
114+of a change in ownership of a facility or institution, the proposed new 79
115+owner of such facility or institution shall submit an application for 80
116+approval to the department pursuant to subdivision (1) of this 81
117+subsection. Such application shall be in a form and manner prescribed 82 Raised Bill No. 5481
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122-following: (A) A cover letter stating the applicant's intent to purchase 85
123-the facility or institution and identification of the facility or institution 86
124-by name, address, county and number and type of beds licensed by the 87
125-department; (B) a description of the proposed transaction, including the 88
126-name of each current owner of the facility or institution; (C) the name of 89
127-each proposed new owner; (D) the name of each owner of any 90
128-nonpublicly traded parent corporation of each proposed new owner; (E) 91
129-if applicable, the proposed new owner's organizational chart, such 92
130-proposed new owner's parent corporation's organizational chart, and 93
131-the organizational chart of each wholly-owned subsidiary of such 94
132-proposed new owner; (F) a copy of the agreement of sale and, if 95
133-applicable, a copy of any lease or management agreements; (G) a 96
134-projection of profits and losses and a capital budget projection, 97
135-including, but not limited to, accounts payable with amount due, days 98
136-overdue and details of payment to all such accounts, for the three years 99
137-following the change in ownership; (H) the name and address of any 100
138-licensed health care facility owned, operated or managed by each 101
139-proposed owner in the United States or any territory of the United States 102
140-during the five years preceding the date on which such application is 103
141-submitted and audited financial statements for each such facility for the 104
142-three years preceding the date on which such application is submitted; 105
143-(I) disclosure of any direct or indirect interests, including such interests 106
144-in intermediate entities and parent, management and property 107
145-companies and other related entities; (J) a statement that the facility or 108
146-institution is not the subject of a pending complaint, investigation or 109
147-licensure action in the state or reciprocal action in another state; (K) 110
148-disclosure of whether the facility or institution has been subject to (i) 111
149-three or more civil penalties imposed through final order of the 112
150-commissioner in accordance with the provisions of sections 19a-524 to 113
151-19a-528, inclusive, or civil penalties imposed pursuant to the laws or 114
152-regulations of another state during the two-year period preceding the 115
153-date on which such application is submitted, or (ii) sanctions, other than 116
154-civil penalties less than or equal to twenty thousand dollars, imposed in 117
155-any state through final adjudication under the Medicare or Medicaid 118
156-program pursuant to Title XVIII or XIX of the federal Social Security Act, 119 Substitute Bill No. 5481
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123+by the commissioner and shall include, but need not be limited to, the 83
124+following: (A) A cover letter stating the applicant's intent to purchase 84
125+the facility or institution and identification of the facility or institution 85
126+by name, address, county and number and type of beds licensed by the 86
127+department; (B) a description of the proposed transaction, including the 87
128+name of each current owner of the facility or institution; (C) the name of 88
129+each proposed new owner; (D) the name of each owner of any 89
130+nonpublicly traded parent corporation of each proposed new owner; (E) 90
131+if applicable, the proposed new owner's organizational chart, such 91
132+proposed new owner's parent corporation's organizational chart, and 92
133+the organizational chart of each wholly-owned subsidiary of such 93
134+proposed new owner; (F) a copy of the agreement of sale and, if 94
135+applicable, a copy of any lease or management agreements; (G) a 95
136+projection of profits and losses and a capital budget projection, 96
137+including, but not limited to, accounts payable with amount due, days 97
138+overdue and details of payment to all such accounts, for the three years 98
139+following the change in ownership, (H) the name and address of any 99
140+licensed health care facility owned, operated or managed by each 100
141+proposed owner in the United States or any territory of the United States 101
142+during the five years preceding the date on which such application is 102
143+submitted and audited financial statements for each such facility for the 103
144+three years preceding the date on which such application is submitted; 104
145+(I) disclosure of any direct or indirect interests, including such interests 105
146+in intermediate entities and parent, management and property 106
147+companies and other related entities; (J) a statement that the facility or 107
148+institution is not the subject of a pending complaint, investigation or 108
149+licensure action in the state or reciprocal action in another state; (K) 109
150+disclosure of whether the facility or institution has been subject to (i) 110
151+three or more civil penalties imposed through final order of the 111
152+commissioner in accordance with the provisions of sections 19a-524 to 112
153+19a-528, inclusive, or civil penalties imposed pursuant to the laws or 113
154+regulations of another state during the two-year period preceding the 114
155+date on which such application is submitted, or (ii) sanctions, other than 115
156+civil penalties less than or equal to twenty thousand dollars, imposed in 116
157+any state through final adjudication under the Medicare or Medicaid 117 Raised Bill No. 5481
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163-42 USC 301, as amended from time to time; and (L) disclosure of 120
164-whether any proposed new owner's Medicare or Medicaid provider 121
165-agreement has been terminated or not renewed in any state. For the 122
166-purposes of this subdivision, "organizational chart" means a graphical 123
167-representation of an organization, including, but not limited to, the 124
168-relationships between such organization's employees, departments and 125
169-the jobs within such organization. 126
170-(3) After receiving an application for change in ownership, the 127
171-department shall schedule an inspection of such facility or institution to 128
172-determine if the facility or institution has complied with the 129
173-requirements of this chapter and the regulations of Connecticut state 130
174-agencies relating to licensure of such facility or institution. If a facility 131
175-or institution is not in compliance with the requirements of a corrective 132
176-action plan or in violation of any provision of the general statutes or the 133
177-regulations of Connecticut state agencies, the commissioner may deny 134
178-the applicant's change in ownership or require the proposed new owner 135
179-to sign a consent order, which shall include, but need not be limited to, 136
180-the implementation of a corrective action plan for any such violation 137
181-within a specified time period. The commissioner may assess a civil 138
182-penalty of not more than one thousand dollars for each day the owner 139
183-of the facility or institution is in violation of any provision of the general 140
184-statutes or the regulations of Connecticut state agencies or such consent 141
185-order. If the commissioner disapproves a change in ownership, a person 142
186-related by blood or marriage to the applicant may not apply to acquire 143
187-ownership interest in the facility or institution. For the purposes of this 144
188-subdivision, "a person related by blood or marriage" means a parent, 145
189-spouse, child, brother, sister, aunt, uncle, niece or nephew. 146
190-(4) For the purposes of this [subdivision] subsection, a change in the 147
191-legal form of the ownership entity, including, but not limited to, changes 148
192-from a corporation to a limited liability company, a partnership to a 149
193-limited liability partnership, a sole proprietorship to a corporation and 150
194-similar changes, shall not be considered a change of ownership if the 151
195-beneficial ownership remains unchanged and the owner provides such 152 Substitute Bill No. 5481
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163+program pursuant to Title XVIII or XIX of the federal Social Security Act, 118
164+42 USC 301, as amended from time to time; and (L) disclosure of 119
165+whether any proposed new owner's Medicare or Medicaid provider 120
166+agreement has been terminated or not renewed in any state. For the 121
167+purposes of this subdivision, "organizational chart" means a graphical 122
168+representation of an organization, including, but not limited to, the 123
169+relationships between such organization's employees, departments and 124
170+the jobs within such organization. 125
171+(3) After receiving an application, the department shall schedule an 126
172+inspection of such facility or institution to determine if the facility or 127
173+institution has complied with the requirements of this chapter and the 128
174+regulations of Connecticut state agencies relating to licensure of such 129
175+facility or institution. If an applicant is not in compliance with the 130
176+requirements of a corrective action plan or in violation of any provision 131
177+of the general statutes or the regulations of Connecticut state agencies, 132
178+the commissioner may deny the applicant's change in ownership or 133
179+require the proposed new owner to sign a consent order, which shall 134
180+include, but need not be limited to, the implementation of a corrective 135
181+action plan for any such violation within a specified time period. The 136
182+commissioner may assess a civil penalty of not more than one thousand 137
183+dollars for each day the owner of the facility or institution is in violation 138
184+of any provision of the general statutes or the regulations of Connecticut 139
185+state agencies or such consent order. If the commissioner disapproves a 140
186+change in ownership, a person related by blood or marriage to the 141
187+applicant may not apply to acquire ownership interest in the facility or 142
188+institution. For the purposes of this subdivision, "a person related by 143
189+blood or marriage" means a parent, spouse, child, brother, sister, aunt, 144
190+uncle, niece or nephew. 145
191+(4) For the purposes of this [subdivision] subsection, a change in the 146
192+legal form of the ownership entity, including, but not limited to, changes 147
193+from a corporation to a limited liability company, a partnership to a 148
194+limited liability partnership, a sole proprietorship to a corporation and 149
195+similar changes, shall not be considered a change of ownership if the 150
196+beneficial ownership remains unchanged and the owner provides such 151 Raised Bill No. 5481
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202-information regarding the change to the department as may be required 153
203-by the department in order to properly identify the current status of 154
204-ownership and beneficial ownership of the facility or institution. For the 155
205-purposes of this subdivision, a public offering of the stock of any 156
206-corporation that owns, conducts, operates or maintains any such facility 157
207-or institution shall not be considered a change in ownership or beneficial 158
208-ownership of such facility or institution if the licensee and the officers 159
209-and directors of such corporation remain unchanged, such public 160
210-offering cannot result in an individual or entity owning ten per cent or 161
211-more of the stock of such corporation, and the owner provides such 162
212-information to the department as may be required by the department in 163
213-order to properly identify the current status of ownership and beneficial 164
214-ownership of the facility or institution. 165
215-[(c)] (d) (1) A multicare institution may, under the terms of its existing 166
216-license, provide behavioral health services or substance use disorder 167
217-treatment services on the premises of more than one facility, at a satellite 168
218-unit or at another location outside of its facilities or satellite units that is 169
219-acceptable to the patient receiving services and is consistent with the 170
220-patient's assessment and treatment plan. Such behavioral health 171
221-services or substance use disorder treatment services may include 172
222-methadone delivery and related substance use treatment services to 173
223-persons in a nursing home facility pursuant to the provisions of section 174
224-19a-495c. 175
225-(2) Any multicare institution that intends to offer services at a satellite 176
226-unit or other location outside of its facilities or satellite units shall submit 177
227-an application for approval to offer services at such location to the 178
228-Department of Public Health. Such application shall be submitted on a 179
229-form and in the manner prescribed by the Commissioner of Public 180
230-Health. Not later than forty-five days after receipt of such application, 181
231-the commissioner shall notify the multicare institution of the approval 182
232-or denial of such application. If the satellite unit or other location is 183
233-approved, that satellite unit or location shall be deemed to be licensed 184
234-in accordance with this section and shall comply with the applicable 185 Substitute Bill No. 5481
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202+information regarding the change to the department as may be required 152
203+by the department in order to properly identify the current status of 153
204+ownership and beneficial ownership of the facility or institution. For the 154
205+purposes of this subdivision, a public offering of the stock of any 155
206+corporation that owns, conducts, operates or maintains any such facility 156
207+or institution shall not be considered a change in ownership or beneficial 157
208+ownership of such facility or institution if the licensee and the officers 158
209+and directors of such corporation remain unchanged, such public 159
210+offering cannot result in an individual or entity owning ten per cent or 160
211+more of the stock of such corporation, and the owner provides such 161
212+information to the department as may be required by the department in 162
213+order to properly identify the current status of ownership and beneficial 163
214+ownership of the facility or institution. 164
215+[(c)] (d) (1) A multicare institution may, under the terms of its existing 165
216+license, provide behavioral health services or substance use disorder 166
217+treatment services on the premises of more than one facility, at a satellite 167
218+unit or at another location outside of its facilities or satellite units that is 168
219+acceptable to the patient receiving services and is consistent with the 169
220+patient's assessment and treatment plan. Such behavioral health 170
221+services or substance use disorder treatment services may include 171
222+methadone delivery and related substance use treatment services to 172
223+persons in a nursing home facility pursuant to the provisions of section 173
224+19a-495c. 174
225+(2) Any multicare institution that intends to offer services at a satellite 175
226+unit or other location outside of its facilities or satellite units shall submit 176
227+an application for approval to offer services at such location to the 177
228+Department of Public Health. Such application shall be submitted on a 178
229+form and in the manner prescribed by the Commissioner of Public 179
230+Health. Not later than forty-five days after receipt of such application, 180
231+the commissioner shall notify the multicare institution of the approval 181
232+or denial of such application. If the satellite unit or other location is 182
233+approved, that satellite unit or location shall be deemed to be licensed 183
234+in accordance with this section and shall comply with the applicable 184
235+requirements of this chapter and regulations adopted under this 185 Raised Bill No. 5481
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241-requirements of this chapter and regulations adopted under this 186
242-chapter. 187
243-(3) A multicare institution that is a hospital providing outpatient 188
244-behavioral health services or other health care services shall provide the 189
245-Department of Public Health with a list of satellite units or locations 190
246-when completing the initial or renewal licensure application. 191
247-(4) The Commissioner of Public Health may adopt regulations, in 192
248-accordance with the provisions of chapter 54, to carry out the provisions 193
249-of this subsection. The Commissioner of Public Health may implement 194
250-policies and procedures necessary to administer the provisions of this 195
251-subsection while in the process of adopting such policies and 196
252-procedures as regulation, provided the commissioner prints notice of 197
253-intent to adopt regulations in the Connecticut Law Journal not later than 198
254-twenty days after the date of implementation. Policies and procedures 199
255-implemented pursuant to this section shall be valid until the time final 200
256-regulations are adopted. 201
257-Sec. 2. Subsection (a) of section 19a-528a of the general statutes is 202
258-repealed and the following is substituted in lieu thereof (Effective July 1, 203
259-2022): 204
260-(a) For any application of licensure for the acquisition of a nursing 205
261-home, any potential nursing home licensee or owner shall submit in 206
262-writing, a change in ownership application with respect to the facility 207
263-for which the change in ownership is sought. The application shall be 208
264-submitted in the form and manner prescribed by the Commissioner of 209
265-Public Health. The commissioner shall include on the first page of the 210
266-application the following statement: "NOTICE: The State of Connecticut 211
267-values the quality of care provided to all nursing home residents. Please 212
268-know that any nursing home licensee, owner or officer, including, but 213
269-not limited to, a director, trustee, limited partner, managing partner, 214
270-general partner or any person having [at least a ten per cent] an 215
271-ownership interest in the nursing home or the entity that owns the 216
272-nursing home, and any administrator, assistant administrator, medical 217 Substitute Bill No. 5481
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279-director, director of nursing or assistant director of nursing may be 218
280-subject to civil and criminal liability, as well as administrative sanctions 219
281-under applicable federal and state law, for the abuse or neglect of a 220
282-resident of the nursing home perpetrated by an employee of the nursing 221
283-home.". 222
241+chapter. 186
242+(3) A multicare institution that is a hospital providing outpatient 187
243+behavioral health services or other health care services shall provide the 188
244+Department of Public Health with a list of satellite units or locations 189
245+when completing the initial or renewal licensure application. 190
246+(4) The Commissioner of Public Health may adopt regulations, in 191
247+accordance with the provisions of chapter 54, to carry out the provisions 192
248+of this subsection. The Commissioner of Public Health may implement 193
249+policies and procedures necessary to administer the provisions of this 194
250+subsection while in the process of adopting such policies and 195
251+procedures as regulation, provided the commissioner prints notice of 196
252+intent to adopt regulations in the Connecticut Law Journal not later than 197
253+twenty days after the date of implementation. Policies and procedures 198
254+implemented pursuant to this section shall be valid until the time final 199
255+regulations are adopted. 200
284256 This act shall take effect as follows and shall amend the following
285257 sections:
286258
287259 Section 1 July 1, 2022 19a-493
288-Sec. 2 July 1, 2022 19a-528a(a)
289260
290-Statement of Legislative Commissioners:
291-In Section 1(c)(1), ""facility" and "institution" have the same meanings as
292-provided in section 19a-490" was changed to ""'facility" means any
293-facility licensed by the Department of Public Health pursuant to chapter
294-368v and "institution" has the same meaning as provided in section 19a-
295-490" for accuracy; and in Section 1(c)(3), "After receiving an application"
296-was changed to "After receiving an application for change in ownership"
297-for clarity and "If an applicant is not in compliance" was changed to "If
298-a facility or institution is not in compliance" for clarity.
299-
300-PH Joint Favorable Subst.
261+Statement of Purpose:
262+To (1) expand the circumstances in which a change in ownership of a
263+health care facility or institution requires approval by the Department
264+of Public Health; and (2) establish an application process for the
265+approval of changes in ownership of health care facilities and
266+institutions.
267+[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
268+that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
269+underlined.]
301270