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OLR Bill Analysis
sHB 6678
AN ACT CONCERNING NURSING HOME TRANSPARENCY.
SUMMARY
This bill makes various changes related to nursing home oversight
and the information they must provide to state agencies. It requires (1)
nursing homes to submit to the Department of Social Services (DSS)
narrative summaries of certain expenditures, in addition to their
annually required cost reports, and (2) DSS to post this information on
its website. The bill subjects nursing homes that fail to do so to a fine of
up to $10,000 per incident.
The bill expands the information that nursing home licensure
applicants must provide to the Department of Public Health (DPH) to
include (1) information on any private equity fund that owns any part
of the home, the name of the fund’s investment advisor, and a copy of
the most recent quarterly statement given to the private fund’s
investors, and (2) the owner’s audited and certified financial statements.
Under current law, these statements are only required if requested by
DPH. The financial statement must include a balance sheet from the end
of the most recent fiscal year and income statements from the most
recent fiscal year (or an applicable shorter period if the owner has not
existed for a full fiscal year).
The bill also broadens certain reporting requirements for chronic and
convalescent nursing homes that receive Medicaid funding. Current law
requires these types of for-profit homes to include in their annual
reports a profit and loss statement from each related party (i.e., a
company related to the home through family association, common
ownership, control, or business association with the home’s owners or
operators) that receives at least $50,000 of income from the home per
year. The bill (1) removes the income threshold, requiring statements 2023HB-06678-R000074-BA.DOCX
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from each related party that received any income from the home, and
(2) extends the requirement to all of these types of nursing homes, not
just for-profits.
EFFECTIVE DATE: July 1, 2023
COST REPORTING REQUI REMENTS
Beginning with the current cost reporting year, the bill requires
nursing homes to annually submit narrative summaries of cost
expenditures to the DSS commissioner, alongside their statutorily
required cost reports. The summaries must include the percentage of
Medicaid funding allocated to, and expenditures in, (1) direct costs, (2)
indirect costs, (3) fair rent, (4) capital-related costs, and (5)
administrative and general costs. They must also include expenditures
for each allowable cost component by the nursing home and any related
party.
Starting by January 1, 2024, the DSS commissioner must annually
post on the agency’s website (1) these cost reports and summaries for
each nursing home, (2) comparisons between individual nursing homes
by expenditures, and (3) a summary of average reported expenditures
by facility for each category. Any cost report forms DSS uses must
include a glossary, an explanation of the terms used, a description of the
reported categories, and a plain language explanation of the formulas
used to determine costs for the five allowable cost components.
The bill requires a nursing home that fails to comply with this
reporting requirement to be fined up to $10,000. Before imposing a
penalty, the social services commissioner must notify the nursing home
about the violation and allow it to request a review. The home must
request a review within 15 days after receiving the notice, and DSS
cannot impose the penalty while the review is pending.
Under the bill, the penalty may be imposed even if the nursing
home’s ownership changes after the violation takes place, as long as DSS
issued the notice about the violation before the change in ownership
became effective and the record of the notice is readily available in a 2023HB-06678-R000074-BA.DOCX
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central registry maintained by DSS. The DSS commissioner may collect
the penalty by offsetting payments due to the facility. Payments made
for these penalties must be deposited in the General Fund and credited
to the Medicaid account.
COMMITTEE ACTION
Aging Committee
Joint Favorable Substitute
Yea 15 Nay 0 (02/28/2023)