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General Assembly Substitute Bill No. 5481
February Session, 2022
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statutes is repealed and the following is substituted in lieu thereof 2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
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 Substitute Bill No. 5481
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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" means any 47
facility licensed by the Department of Public Health pursuant to chapter 48
368v and "institution" has the same meaning as provided in section 19a-49
490. Any change in the ownership of a facility or institution [, as defined 50 Substitute Bill No. 5481
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in section 19a-490,] owned by an individual, partnership or association 51
or the change in ownership or beneficial ownership of [ten per cent or 52
more of the stock of a corporation] the entity which owns, conducts, 53
operates or maintains such facility or institution, including a change in 54
ownership or beneficial ownership resulting in a transfer to a person 55
related by blood or marriage to such an owner or beneficial owner, shall 56
be subject to prior approval of the department. [after a scheduled 57
inspection of such facility or institution is conducted by the department, 58
provided such approval shall be conditioned upon a showing by such 59
facility or institution to the commissioner that it has complied with all 60
requirements of this chapter, the regulations relating to licensure and all 61
applicable requirements of the regulations of Connecticut state agencies. 62
Any such change in ownership or beneficial ownership resulting in a 63
transfer to a person related by blood or marriage to such an owner or 64
beneficial owner shall not be subject to prior approval of the department 65
unless: (A) Ownership or beneficial ownership of ten per cent or more 66
of the stock of a corporation, limited liability company, partnership or 67
association which owns, conducts, operates or maintains more than one 68
facility or institution is transferred; (B) ownership or beneficial 69
ownership is transferred in more than one facility or institution; or (C) 70
the facility or institution is the subject of a pending complaint, 71
investigation or licensure action. If the facility or institution is not in 72
compliance, the commissioner may require the new owner to sign a 73
consent order providing reasonable assurances that the violations shall 74
be corrected within a specified period of time. Notice of any such 75
proposed change of ownership shall be given to the department at least 76
one hundred twenty days prior to the effective date of such proposed 77
change.] 78
(2) Not later than one hundred twenty days before the proposed date 79
of a change in ownership of a facility or institution, the proposed new 80
owner of such facility or institution shall submit an application for 81
approval to the department pursuant to subdivision (1) of this 82
subsection. Such application shall be in a form and manner prescribed 83
by the commissioner and shall include, but need not be limited to, the 84 Substitute Bill No. 5481
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following: (A) A cover letter stating the applicant's intent to purchase 85
the facility or institution and identification of the facility or institution 86
by name, address, county and number and type of beds licensed by the 87
department; (B) a description of the proposed transaction, including the 88
name of each current owner of the facility or institution; (C) the name of 89
each proposed new owner; (D) the name of each owner of any 90
nonpublicly traded parent corporation of each proposed new owner; (E) 91
if applicable, the proposed new owner's organizational chart, such 92
proposed new owner's parent corporation's organizational chart, and 93
the organizational chart of each wholly-owned subsidiary of such 94
proposed new owner; (F) a copy of the agreement of sale and, if 95
applicable, a copy of any lease or management agreements; (G) a 96
projection of profits and losses and a capital budget projection, 97
including, but not limited to, accounts payable with amount due, days 98
overdue and details of payment to all such accounts, for the three years 99
following the change in ownership; (H) the name and address of any 100
licensed health care facility owned, operated or managed by each 101
proposed owner in the United States or any territory of the United States 102
during the five years preceding the date on which such application is 103
submitted and audited financial statements for each such facility for the 104
three years preceding the date on which such application is submitted; 105
(I) disclosure of any direct or indirect interests, including such interests 106
in intermediate entities and parent, management and property 107
companies and other related entities; (J) a statement that the facility or 108
institution is not the subject of a pending complaint, investigation or 109
licensure action in the state or reciprocal action in another state; (K) 110
disclosure of whether the facility or institution has been subject to (i) 111
three or more civil penalties imposed through final order of the 112
commissioner in accordance with the provisions of sections 19a-524 to 113
19a-528, inclusive, or civil penalties imposed pursuant to the laws or 114
regulations of another state during the two-year period preceding the 115
date on which such application is submitted, or (ii) sanctions, other than 116
civil penalties less than or equal to twenty thousand dollars, imposed in 117
any state through final adjudication under the Medicare or Medicaid 118
program pursuant to Title XVIII or XIX of the federal Social Security Act, 119 Substitute Bill No. 5481
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42 USC 301, as amended from time to time; and (L) disclosure of 120
whether any proposed new owner's Medicare or Medicaid provider 121
agreement has been terminated or not renewed in any state. For the 122
purposes of this subdivision, "organizational chart" means a graphical 123
representation of an organization, including, but not limited to, the 124
relationships between such organization's employees, departments and 125
the jobs within such organization. 126
(3) After receiving an application for change in ownership, the 127
department shall schedule an inspection of such facility or institution to 128
determine if the facility or institution has complied with the 129
requirements of this chapter and the regulations of Connecticut state 130
agencies relating to licensure of such facility or institution. If a facility 131
or institution is not in compliance with the requirements of a corrective 132
action plan or in violation of any provision of the general statutes or the 133
regulations of Connecticut state agencies, the commissioner may deny 134
the applicant's change in ownership or require the proposed new owner 135
to sign a consent order, which shall include, but need not be limited to, 136
the implementation of a corrective action plan for any such violation 137
within a specified time period. The commissioner may assess a civil 138
penalty of not more than one thousand dollars for each day the owner 139
of the facility or institution is in violation of any provision of the general 140
statutes or the regulations of Connecticut state agencies or such consent 141
order. If the commissioner disapproves a change in ownership, a person 142
related by blood or marriage to the applicant may not apply to acquire 143
ownership interest in the facility or institution. For the purposes of this 144
subdivision, "a person related by blood or marriage" means a parent, 145
spouse, child, brother, sister, aunt, uncle, niece or nephew. 146
(4) For the purposes of this [subdivision] subsection, a change in the 147
legal form of the ownership entity, including, but not limited to, changes 148
from a corporation to a limited liability company, a partnership to a 149
limited liability partnership, a sole proprietorship to a corporation and 150
similar changes, shall not be considered a change of ownership if the 151
beneficial ownership remains unchanged and the owner provides such 152 Substitute Bill No. 5481
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information regarding the change to the department as may be required 153
by the department in order to properly identify the current status of 154
ownership and beneficial ownership of the facility or institution. For the 155
purposes of this subdivision, a public offering of the stock of any 156
corporation that owns, conducts, operates or maintains any such facility 157
or institution shall not be considered a change in ownership or beneficial 158
ownership of such facility or institution if the licensee and the officers 159
and directors of such corporation remain unchanged, such public 160
offering cannot result in an individual or entity owning ten per cent or 161
more of the stock of such corporation, and the owner provides such 162
information to the department as may be required by the department in 163
order to properly identify the current status of ownership and beneficial 164
ownership of the facility or institution. 165
[(c)] (d) (1) A multicare institution may, under the terms of its existing 166
license, provide behavioral health services or substance use disorder 167
treatment services on the premises of more than one facility, at a satellite 168
unit or at another location outside of its facilities or satellite units that is 169
acceptable to the patient receiving services and is consistent with the 170
patient's assessment and treatment plan. Such behavioral health 171
services or substance use disorder treatment services may include 172
methadone delivery and related substance use treatment services to 173
persons in a nursing home facility pursuant to the provisions of section 174
19a-495c. 175
(2) Any multicare institution that intends to offer services at a satellite 176
unit or other location outside of its facilities or satellite units shall submit 177
an application for approval to offer services at such location to the 178
Department of Public Health. Such application shall be submitted on a 179
form and in the manner prescribed by the Commissioner of Public 180
Health. Not later than forty-five days after receipt of such application, 181
the commissioner shall notify the multicare institution of the approval 182
or denial of such application. If the satellite unit or other location is 183
approved, that satellite unit or location shall be deemed to be licensed 184
in accordance with this section and shall comply with the applicable 185 Substitute Bill No. 5481
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requirements of this chapter and regulations adopted under this 186
chapter. 187
(3) A multicare institution that is a hospital providing outpatient 188
behavioral health services or other health care services shall provide the 189
Department of Public Health with a list of satellite units or locations 190
when completing the initial or renewal licensure application. 191
(4) The Commissioner of Public Health may adopt regulations, in 192
accordance with the provisions of chapter 54, to carry out the provisions 193
of this subsection. The Commissioner of Public Health may implement 194
policies and procedures necessary to administer the provisions of this 195
subsection while in the process of adopting such policies and 196
procedures as regulation, provided the commissioner prints notice of 197
intent to adopt regulations in the Connecticut Law Journal not later than 198
twenty days after the date of implementation. Policies and procedures 199
implemented pursuant to this section shall be valid until the time final 200
regulations are adopted. 201
Sec. 2. Subsection (a) of section 19a-528a of the general statutes is 202
repealed and the following is substituted in lieu thereof (Effective July 1, 203
2022): 204
(a) For any application of licensure for the acquisition of a nursing 205
home, any potential nursing home licensee or owner shall submit in 206
writing, a change in ownership application with respect to the facility 207
for which the change in ownership is sought. The application shall be 208
submitted in the form and manner prescribed by the Commissioner of 209
Public Health. The commissioner shall include on the first page of the 210
application the following statement: "NOTICE: The State of Connecticut 211
values the quality of care provided to all nursing home residents. Please 212
know that any nursing home licensee, owner or officer, including, but 213
not limited to, a director, trustee, limited partner, managing partner, 214
general partner or any person having [at least a ten per cent] an 215
ownership interest in the nursing home or the entity that owns the 216
nursing home, and any administrator, assistant administrator, medical 217 Substitute Bill No. 5481
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director, director of nursing or assistant director of nursing may be 218
subject to civil and criminal liability, as well as administrative sanctions 219
under applicable federal and state law, for the abuse or neglect of a 220
resident of the nursing home perpetrated by an employee of the nursing 221
home.". 222
This act shall take effect as follows and shall amend the following
sections:
Section 1 July 1, 2022 19a-493
Sec. 2 July 1, 2022 19a-528a(a)
Statement of Legislative Commissioners:
In Section 1(c)(1), ""facility" and "institution" have the same meanings as
provided in section 19a-490" was changed to ""'facility" means any
facility licensed by the Department of Public Health pursuant to chapter
368v and "institution" has the same meaning as provided in section 19a-
490" for accuracy; and in Section 1(c)(3), "After receiving an application"
was changed to "After receiving an application for change in ownership"
for clarity and "If an applicant is not in compliance" was changed to "If
a facility or institution is not in compliance" for clarity.
PH Joint Favorable Subst.