Florida Senate - 2023 SB 622 By Senator Yarborough 4-00524A-23 2023622__ 1 A bill to be entitled 2 An act relating to continuing care contracts; amending 3 s. 651.011, F.S.; defining the terms designated 4 resident representative and residents council; 5 amending s. 651.0246, F.S.; revising requirements for 6 feasibility studies submitted by providers applying 7 for expansions of certificated continuing care 8 facilities; revising a condition for the release of 9 certain escrowed funds to a provider; revising the 10 timeframe in which the Office of Insurance Regulation 11 must complete its review of an application for 12 expansion; amending s. 651.026, F.S.; revising 13 information required to be contained in certain 14 providers financial reports in their annual reports; 15 amending s. 651.033, F.S.; revising a requirement for 16 national banks in which escrow accounts are 17 established; revising a condition under which a 18 provider may hold and not deposit a residents check 19 for a specified period; amending s. 651.034, F.S.; 20 revising the timeframe during which the office may 21 exempt certain providers from certain regulatory 22 actions; authorizing the office, upon a providers 23 written request, to temporarily suspend financial and 24 operating requirements under ch. 651, F.S., for 25 specified reasons; specifying conditions and 26 requirements for such temporary suspensions; amending 27 s. 651.035, F.S.; providing that certain documents 28 relating to a providers debt service reserve must 29 require certain notice to the office before the 30 withdrawal of debt service reserve funds; specifying 31 requirements for the notice and for certain plans to 32 replenish withdrawn funds; revising the calculation of 33 minimum liquid reserve requirements for certain 34 facilities; revising requirements for letters of 35 credit which satisfy minimum liquid reserve 36 requirements; revising circumstances under which a 37 provider may withdraw funds held in escrow without the 38 offices approval; making a technical change; amending 39 s. 651.055, F.S.; specifying that a forfeiture penalty 40 may be deducted from certain resident refunds except 41 under certain circumstances; conforming a provision to 42 changes made by the act; amending s. 651.081, F.S.; 43 specifying the authority of residents councils and 44 the eligibility of persons to participate in 45 residents council matters; deleting a requirement for 46 open meetings of residents councils; amending s. 47 651.083, F.S.; specifying that a resident has the 48 right to access ombudsman staff; amending s. 651.085, 49 F.S.; requiring residents councils to nominate and 50 elect a designated resident representative to 51 represent them on specified matters; providing 52 requirements for designated resident representatives; 53 revising meetings of the full governing body for which 54 the designated resident representative must be 55 notified; requiring each facility of certain providers 56 to have its own designated resident representative; 57 providing a requirement for certain designated 58 resident representatives; amending s. 651.091, F.S.; 59 adding reporting and notice requirements for 60 continuing care facilities; adding a disclosure 61 requirement for providers to prospective residents or 62 their legal representatives; amending s. 651.105, 63 F.S.; specifying requirements for the offices 64 examination of providers and applicants for 65 certificates of authority; deleting a requirement for 66 a providers representative to give examination 67 reports and corrective action plans to the governing 68 bodys executive officer within a certain timeframe; 69 amending s. 651.118, F.S.; revising applicability of a 70 specified time limit on the use of sheltered nursing 71 home beds for certain persons; amending ss. 651.012 72 and 651.0261, F.S.; conforming cross-references; 73 providing an effective date. 74 75 Be It Enacted by the Legislature of the State of Florida: 76 77 Section 1.Present subsections (13) through (26) and (27) 78 of section 651.011, Florida Statutes, are redesignated as 79 subsections (14) through (27) and (29), respectively, and new 80 subsection (13) and subsection (28) are added to that section, 81 to read: 82 651.011Definitions.As used in this chapter, the term: 83 (13)Designated resident representative means a resident 84 elected by the residents council to represent residents on 85 matters related to changes in fees or services as specified in 86 s. 651.085(2) and (3). 87 (28)Residents council means an organized body 88 representing the resident population of a certified facility. A 89 residents council shall serve as a liaison between residents 90 and the appropriate representative of the provider. 91 Section 2.Paragraph (a) of subsection (2), paragraph (b) 92 of subsection (4), and subsection (6) of section 651.0246, 93 Florida Statutes, are amended to read: 94 651.0246Expansions. 95 (2)A provider applying for expansion of a certificated 96 facility must submit all of the following: 97 (a)A feasibility study prepared by an independent 98 consultant which includes an independent evaluation and 99 examination opinion or compilation report for the first 5 years 100 of operations, or a comparable opinion acceptable to the office, 101 of the underlying assumptions used as a basis for the forecasts 102 or projections in the study prepared in accordance with 103 applicable professional standards adopted by the American 104 Institute of Certified Public Accountants or standards for 105 feasibility studies for continuing care retirement communities 106 adopted by the Actuarial Standards Board certified public 107 accountant. The feasibility study must include at least the 108 following information: 109 1.A description of the facility and proposed expansion, 110 including the location, the size, the anticipated completion 111 date, and the proposed construction program. 112 2.An identification and evaluation of the primary and, if 113 applicable, secondary market areas of the facility and the 114 projected unit sales per month. 115 3.Projected revenues, including anticipated entrance fees; 116 monthly service fees; nursing care revenues, if applicable; and 117 all other sources of revenue. 118 4.Projected expenses, including for staffing requirements 119 and salaries; the cost of property, plant, and equipment, 120 including depreciation expense; interest expense; marketing 121 expense; and other operating expenses. 122 5.A projected balance sheet of the applicant. 123 6.The expectations for the financial condition of the 124 project, including the projected cash flow and an estimate of 125 the funds anticipated to be necessary to cover startup losses. 126 7.The inflation factor, if any, assumed in the study for 127 the proposed expansion and how and where it is applied. 128 8.Project costs; the total amount of debt financing 129 required; marketing projections; resident rates, fees, and 130 charges; the competition; resident contract provisions; and 131 other factors that affect the feasibility of the facility. 132 9.Appropriate population projections, including morbidity 133 and mortality assumptions. 134 10.The name of the person who prepared the feasibility 135 study and his or her experience in preparing similar studies or 136 otherwise consulting in the field of continuing care. 137 11.Financial forecasts or projections prepared in 138 accordance with standards adopted by the American Institute of 139 Certified Public Accountants or in accordance with standards for 140 feasibility studies for continuing care retirement communities 141 adopted by the Actuarial Standards Board. 142 12.An independent evaluation and examination opinion for 143 the first 5 years of operations, or a comparable opinion 144 acceptable to the office, by the consultant who prepared the 145 study, of the underlying assumptions used as a basis for the 146 forecasts or projections in the study and that the assumptions 147 are reasonable and proper and the project as proposed is 148 feasible. 149 13.Any other information that the provider deems relevant 150 and appropriate to provide to enable the office to make a more 151 informed determination. 152 153 If any material change occurs in the facts set forth in an 154 application filed with the office pursuant to this section, an 155 amendment setting forth such change must be filed with the 156 office within 10 business days after the applicant becomes aware 157 of such change, and a copy of the amendment must be sent by 158 registered mail to the principal office of the facility and to 159 the principal office of the controlling company. 160 (4)The provider is entitled to secure release of the 161 moneys held in escrow within 7 days after receipt by the office 162 of an affidavit from the provider, along with appropriate copies 163 to verify, and notification to the escrow agent by certified 164 mail that the following conditions have been satisfied: 165 (b)Payment in full has been received for at least 50 166 percent of the total units of a phase or of the total of the 167 combined phases constructed; or at least 75 percent of the 168 proposed units for which an entrance fee is charged for a phase 169 or a total of the combined phases are reserved and the provider 170 submits an attestation to the office to use the entrance fees 171 collected and held in escrow for the sole purpose of paying 172 secured indebtedness as specified in the feasibility study 173 submitted to the office pursuant to paragraph (2)(a). If the 174 expansion is to be completed in multiple phases, the 75 percent 175 reservation requirement applies separately to each phase of the 176 expansion. If a provider offering continuing care at-home is 177 applying for a release of escrowed entrance fees, the same 178 minimum requirement must be met for the continuing care and 179 continuing care at-home contracts independently of each other. 180 181 Notwithstanding chapter 120, only the provider, the escrow 182 agent, and the office have a substantial interest in any office 183 decision regarding release of escrow funds in any proceedings 184 under chapter 120 or this chapter. 185 (6)Within 30 45 days after the date on which an 186 application is deemed complete as provided in paragraph (5)(b), 187 the office shall complete its review and, based upon its review, 188 approve an expansion by the applicant and issue a determination 189 that the application meets all requirements of law, that the 190 feasibility study was based on sufficient data and reasonable 191 assumptions, and that the applicant will be able to provide 192 continuing care or continuing care at-home as proposed and meet 193 all financial and contractual obligations related to its 194 operations, including the financial requirements of this 195 chapter. If the application is denied, the office must notify 196 the applicant in writing, citing the specific failures to meet 197 the requirements of this chapter. The denial entitles the 198 applicant to a hearing pursuant to chapter 120. 199 Section 3.Paragraph (b) of subsection (2) of section 200 651.026, Florida Statutes, is amended to read: 201 651.026Annual reports. 202 (2)The annual report shall be in such form as the 203 commission prescribes and shall contain at least the following: 204 (b)A financial report audited by an independent certified 205 public accountant which must contain, for two or more periods if 206 the facility has been in existence that long, all of the 207 following: 208 1.An accountants opinion and, in accordance with 209 generally accepted accounting principles: 210 a.A balance sheet; 211 b.A statement of income and expenses; 212 c.A statement of equity or fund balances; and 213 d.A statement of changes in cash flows. 214 2.Notes to the financial report considered customary or 215 necessary for full disclosure or adequate understanding of the 216 financial report, financial condition, and operation. 217 3.If the providers financial statements are consolidated 218 or combined in accordance with generally accepted accounting 219 principles with the financial statements of additional entities 220 owned or controlled by the provider, the financial report must 221 provide as supplemental information the financial statements of 222 the provider with the items in subparagraph 1. for the 223 individual facility shown separately and its consolidated or 224 combined entities comprising the financial report. 225 4.If the facility is a member of an obligated group, the 226 facility may use the obligated groups audited financial 227 statements if they contain the items in subparagraph 1. for the 228 individual facility shown separately from other members of the 229 obligated group. 230 Section 4.Paragraph (a) of subsection (1) and paragraph 231 (c) of subsection (3) of section 651.033, Florida Statutes, are 232 amended, and paragraph (a) of subsection (3) of that section is 233 republished, to read: 234 651.033Escrow accounts. 235 (1)When funds are required to be deposited in an escrow 236 account pursuant to s. 651.0215, s. 651.022, s. 651.023, s. 237 651.0246, s. 651.035, or s. 651.055: 238 (a)The escrow account must be established in a Florida 239 bank, Florida savings and loan association, Florida trust 240 company, or a national bank that is chartered and supervised by 241 the Office of the Comptroller of the Currency within the United 242 States Department of the Treasury and that has a branch in this 243 state, which is acceptable to the office, or such funds must be 244 deposited with the department and be kept and maintained in an 245 account separate and apart from the providers business 246 accounts. 247 (3)When entrance fees are required to be deposited in an 248 escrow account pursuant to s. 651.0215, s. 651.022, s. 651.023, 249 s. 651.0246, or s. 651.055: 250 (a)The provider shall deliver to the resident a written 251 receipt. The receipt must show the payors name and address, the 252 date, the price of the care contract, and the amount of money 253 paid. A copy of each receipt, together with the funds, must be 254 deposited with the escrow agent or as provided in paragraph (c). 255 The escrow agent must release such funds to the provider 7 days 256 after the date of receipt of the funds by the escrow agent if 257 the provider, operating under a certificate of authority issued 258 by the office, has met the requirements of s. 651.0215(8), s. 259 651.023(6), or s. 651.0246. However, if the resident rescinds 260 the contract within the 7-day period, the escrow agent must 261 release the escrowed fees to the resident. 262 (c)As an alternative to paragraph (a) At the request of an 263 individual resident of a facility, the provider may hold the 264 check for the 7-day period and may not deposit it during this 265 time period. If the resident rescinds the contract within the 7 266 day period, the check must be immediately returned to the 267 resident. Upon the expiration of the 7 days, the provider shall 268 deposit the check. 269 Section 5.Present subsection (7) of section 651.034, 270 Florida Statutes, is redesignated as subsection (8), a new 271 subsection (7) is added to that section, and subsection (6) of 272 that section is amended, to read: 273 651.034Financial and operating requirements for 274 providers. 275 (6)The office may exempt a provider from subsection (1) or 276 subsection (2) until stabilized occupancy is reached or until 277 the time projected to achieve stabilized occupancy as reported 278 in the last feasibility study required by the office as part of 279 an application filing under s. 651.0215, s. 651.023, s. 651.024, 280 or s. 651.0246 has elapsed, but for no longer than 5 years after 281 the end of the providers fiscal year in which the certificate 282 of occupancy was issued date of issuance of the certificate of 283 occupancy. 284 (7)Upon written request of a provider, the office may 285 temporarily suspend all or a portion of financial and operating 286 requirements under this chapter due to an extraordinary event 287 rendering the provider incapable of continuing normal operations 288 such as, but not limited to, a pandemic, a fire, or a federal or 289 state executive order declaring a natural disaster which forces 290 the provider to evacuate, curtail operations, restrict 291 admissions, or suspend marketing for lifesafety reasons or 292 repairs related to the event. Such temporary suspension may be 293 granted by the office if the provider maintains compliance with 294 ss. 651.026, 651.0261, and 651.035 and the provider is not 295 insolvent or impaired. The provider shall comply with required 296 reporting requested by the office, including the estimated time 297 for completing repairs or remediating problems related to 298 restrictions on admissions or marketing. When determining 299 whether to grant a suspension of specific regulatory 300 requirements, the office shall consider any formal action or 301 amendments approved by a lender or trustee to the providers 302 lending agreements or bond covenants as a result of the event. 303 Section 6.Paragraph (b) of subsection (1), paragraph (a) 304 of subsection (2), subsection (5), and paragraph (a) of 305 subsection (7) of section 651.035, Florida Statutes, are amended 306 to read: 307 651.035Minimum liquid reserve requirements. 308 (1)A provider shall maintain in escrow a minimum liquid 309 reserve consisting of the following reserves, as applicable: 310 (b)A provider that has outstanding indebtedness that 311 requires a debt service reserve to be held in escrow pursuant to 312 a trust indenture or mortgage lien on the facility and for which 313 the debt service reserve may only be used to pay principal and 314 interest payments on the debt that the debtor is obligated to 315 pay, and which may include property taxes and insurance, may 316 include such debt service reserve in computing the minimum 317 liquid reserve needed to satisfy this subsection if the provider 318 furnishes to the office a copy of the agreement under which such 319 debt service reserve is held, together with a statement of the 320 amount being held in escrow for the debt service reserve, 321 certified by the lender or trustee and the provider to be 322 correct. The trustee shall provide the office with any 323 information concerning the debt service reserve account upon 324 request of the provider or the office. In addition, the trust 325 indenture, loan agreement, or escrow agreement must provide that 326 the provider, trustee, lender, escrow agent, or another person 327 designated to act in their place shall notify the office in 328 writing at least 10 days before the withdrawal of any portion of 329 the debt service reserve funds required to be held in escrow as 330 described in this paragraph. The notice must include an 331 affidavit sworn to by the provider, the trustee, or a person 332 designated to act in their place which includes the amount of 333 the scheduled debt service payment, the payment due date, the 334 amount of the withdrawal, the accounts from which the withdrawal 335 will be made, and a plan with a schedule for replenishing the 336 withdrawn funds. If the plan is revised by a consultant that is 337 retained as prescribed in the providers financing documents, 338 the revised plan must be submitted to the office within 10 days 339 after approval by the lender or trustee. Any such separate debt 340 service reserves are not subject to the transfer provisions set 341 forth in subsection (8). 342 (2)(a)In facilities where not all residents are under 343 continuing care or continuing care at-home contracts, the 344 reserve requirements of subsection (1) shall be computed only 345 with respect to the proportional share of operating expenses 346 that are applicable to residents. For purposes of this 347 calculation, the proportional share shall be based upon the 348 ratio of residents under continuing care or continuing care at 349 home contracts to the total of all residents, including those 350 residents who do not hold such contracts. 351 (5)A provider may satisfy the minimum liquid reserve 352 requirements of this section by acquiring from a financial 353 institution, as specified in paragraph (b), a clean, 354 unconditional irrevocable letter of credit equal to the 355 requirements of this section, less the amount of escrowed 356 operating cash required by paragraph (d). 357 (a)The letter of credit must be issued by a financial 358 institution participating in the State of Florida Treasury 359 Certificate of Deposit Program or a Florida bank, a Florida 360 savings and loan association, a Florida trust company, or a 361 national bank that is chartered and supervised by the Office of 362 the Comptroller of the Currency within the United States 363 Department of the Treasury, and must be approved by the office 364 before issuance and before any renewal or modification thereof. 365 At a minimum, the letter of credit must provide for: 366 1.Ninety days prior written notice to both the provider 367 and the office of the financial institutions determination not 368 to renew or extend the term of the letter of credit. 369 2.Unless otherwise arranged by the provider to the 370 satisfaction of the office, deposit by the financial institution 371 of letter of credit funds in an account designated by the office 372 no later than 30 days before the expiration of the letter of 373 credit. 374 3.Deposit by the financial institution of letter of credit 375 funds in an account designated by the office within 4 business 376 days following written instructions from the office that, in the 377 sole judgment of the office, funding of the minimum liquid 378 reserve is required. 379 (b)The terms of the letter of credit must be approved by 380 the office and the long-term debt of the financial institution 381 providing such letter of credit must be rated in one of their 382 top three long-term debt rating categories by either Moodys 383 Investors Service, Standard & Poors Corporation, or a 384 recognized securities rating agency acceptable to the office. 385 (c)The letter of credit must name the office as 386 beneficiary. 387 (d)Notwithstanding any other provision of this section, a 388 provider using a letter of credit pursuant to this subsection 389 shall, at all times, have and maintain in escrow an operating 390 cash reserve equal to 2 months operating expenses as determined 391 pursuant to s. 651.026. 392 (e)If the issuing financial institution no longer 393 participates in the State of Florida Treasury Certificate of 394 Deposit Program, such financial institution shall deposit as 395 collateral with the department eligible securities, as 396 prescribed by s. 625.52, having a market value equal to or 397 greater than 100 percent of the stated amount of the letter of 398 credit. 399 (7)(a)A provider may withdraw funds held in escrow without 400 the approval of the office if: 401 1.The amount held in escrow exceeds the requirements of 402 this section and if the withdrawal will not affect compliance 403 with this section; or 404 2.The withdrawal is from a debt service reserve required 405 to be held in escrow pursuant to a trust indenture or mortgage 406 lien on the facility as described in paragraph (1)(b) and will 407 be used to pay delinquent principal and interest payments the 408 debtor is obligated to pay on the facility. 409 Section 7.Subsection (2) of section 651.055, Florida 410 Statutes, is amended to read: 411 651.055Continuing care contracts; right to rescind. 412 (2)A resident has the right to rescind a continuing care 413 contract and receive a full refund of any funds paid, without 414 penalty or forfeiture, within 7 days after executing the 415 contract. However, if an individual signs a reservation 416 agreement pursuant to s. 651.023(4) and fails to cancel such 417 agreement within 30 days after executing the agreement and 418 subsequently signs a contract and rescinds the contract within 7 419 days, the forfeiture penalty authorized under s. 651.023(4)(b) 420 may be deducted from the refund unless the individual can 421 demonstrate extenuating circumstances, such as, but not limited 422 to, the death or illness of a spouse or partner, a diagnosis of 423 a chronic or terminal illness of the individual, or a change in 424 financial or asset position which warrants cancellation of the 425 contract. A resident may not be required to move into the 426 facility designated in the contract before the expiration of the 427 7-day period. During the 7-day period, the residents funds must 428 be held in an escrow account or the provider may hold the check 429 until the 7-day period expires unless otherwise requested by the 430 resident pursuant to s. 651.033(3)(c). 431 Section 8.Paragraphs (a) and (d) of subsection (2) of 432 section 651.081, Florida Statutes, are amended to read: 433 651.081Residents council. 434 (2)(a)Each facility shall establish a residents council 435 created for the purpose of representing residents on matters set 436 forth in s. 651.085. A residents council has authority to 437 establish and maintain its own governance documents, such as 438 bylaws or operating agreements, policies, and operating 439 procedures, which may include establishment of committees. A 440 person is eligible to participate in residents council matters, 441 including elections, if the person meets the definition of a 442 resident under s. 651.011. The residents council shall be 443 established through an election in which the residents, as 444 defined in s. 651.011, vote by ballot, physically or by proxy. 445 If the election is to be held during a meeting, a notice of the 446 organizational meeting must be provided to all residents of the 447 community at least 10 business days before the meeting. Notice 448 may be given through internal mailboxes, communitywide 449 newsletters, bulletin boards, in-house television stations, and 450 other similar means of communication. An election creating a 451 residents council is valid if at least 40 percent of the total 452 resident population participates in the election and a majority 453 of the participants vote affirmatively for the council. The 454 initial residents council created under this section is valid 455 for at least 12 months. A residents organization formalized by 456 bylaws and elected officials must be recognized as the 457 residents council under this section and s. 651.085. Within 30 458 days after the election of a newly elected president or chair of 459 the residents council, the provider shall give the president or 460 chair a copy of this chapter and rules adopted thereunder, or 461 direct him or her to the appropriate public website to obtain 462 this information. Only one residents council may represent 463 residents before the governing body of the provider as described 464 in s. 651.085(2). 465 (d)A residents council shall adopt its own bylaws and 466 governance documents subject to the vote and approval of the 467 residents. The residents council shall provide for open 468 meetings when appropriate. The residents council governing 469 documents shall define the manner in which residents may submit 470 an issue to the council and define a reasonable timeframe in 471 which the residents council shall respond to a resident 472 submission or inquiry. A residents council may include term 473 limits in its governing documents to ensure consistent 474 integration of new leaders. If a licensed facility files for 475 bankruptcy under chapter 11 of the United States Bankruptcy 476 Code, 11 U.S.C. chapter 11, the facility, in its required filing 477 of the 20 largest unsecured creditors with the United States 478 Trustee, shall include the name and contact information of a 479 designated resident selected by the residents council, and a 480 statement explaining that the designated resident was chosen by 481 the residents council to serve as a representative of the 482 residents interest on the creditors committee, if appropriate. 483 Section 9.Paragraph (f) of subsection (1) of section 484 651.083, Florida Statutes, is amended to read: 485 651.083Residents rights. 486 (1)No resident of any facility shall be deprived of any 487 civil or legal rights, benefits, or privileges guaranteed by 488 law, by the State Constitution, or by the United States 489 Constitution solely by reason of status as a resident of a 490 facility. Each resident of a facility has the right to: 491 (f)Present grievances and recommend changes in policies, 492 procedures, and services to the staff of the facility, governing 493 officials, or any other person without restraint, interference, 494 coercion, discrimination, or reprisal. This right includes 495 access to ombudsman volunteers or staff and advocates and the 496 right to be a member of, and active in, and to associate with, 497 advocacy or special interest groups or associations. 498 Section 10.Subsections (2), (3), and (5) of section 499 651.085, Florida Statutes, are amended to read: 500 651.085Quarterly meetings between residents and the 501 governing body of the provider; resident representation before 502 the governing body of the provider. 503 (2)A residents council formed pursuant to s. 651.081, 504 members of which are elected by the residents, shall nominate 505 and elect designate a designated resident representative to 506 represent them on matters specified in subsection (3) before the 507 governing body of the provider. The initial designated resident 508 representative elected under this section shall be elected to 509 serve at least 12 months. The designated resident representative 510 need not be a current member of the residents council; however, 511 such individual must meet the definition of a resident under s. 512 651.011. 513 (3)The designated resident representative shall be 514 notified by a representative of the provider at least 14 days in 515 advance of any meeting of the full governing body at which the 516 annual budget and proposed changes or increases in resident fees 517 or services are on the agenda or will be discussed. The 518 designated resident representative shall be invited to attend 519 and participate in that portion of the meeting designated for 520 the discussion of such changes. A designated resident 521 representative shall perform his or her duties in good faith. 522 For a provider that owns or operates more than one facility in 523 this state, each facility must have its own designated resident 524 representative. 525 (5)The board of directors or governing board of a licensed 526 provider may at its sole discretion allow a resident of the 527 facility to be a voting member of the board or governing body of 528 the facility. The board of directors or governing board of a 529 licensed provider may establish specific criteria for the 530 nomination, selection, and term of a resident as a member of the 531 board or governing body. If the board or governing body of a 532 licensed provider operates more than one licensed facility, 533 regardless of whether the facility is in-state or out-of-state, 534 the board or governing body may select at its sole discretion 535 one resident from among its facilities to serve on the board of 536 directors or governing body on a rotating basis. A resident who 537 serves as a member of a board or governing body of the facility 538 shall perform his or her duties in a fiduciary manner, including 539 the duty of confidentiality, duty of care, duty of loyalty, and 540 duty of obedience, as required of any individual serving on the 541 board or governing body. 542 Section 11.Present paragraphs (e) through (k) and (l) of 543 subsection (2) of section 651.091, Florida Statutes, are 544 redesignated as paragraphs (f) through (l) and (n), 545 respectively, new paragraph (e) and paragraph (m) are added to 546 that subsection, and paragraph (m) is added to subsection (3) of 547 that section, to read: 548 651.091Availability, distribution, and posting of reports 549 and records; requirement of full disclosure. 550 (2)Every continuing care facility shall: 551 (e)Provide a copy of the final examination report and 552 corrective action plan, if one is required by the office, to the 553 executive officer of the governing body of the provider and the 554 president or chair of the residents council within 60 days 555 after issuance of the report. 556 (m)Notify the president or chair of the residents council 557 in writing of a change in management within 10 business days 558 after the change. 559 (3)Before entering into a contract to furnish continuing 560 care or continuing care at-home, the provider undertaking to 561 furnish the care, or the agent of the provider, shall make full 562 disclosure, obtain written acknowledgment of receipt, and 563 provide copies of the disclosure documents to the prospective 564 resident or his or her legal representative, of the following 565 information: 566 (m)Disclosure of whether the provider has one or more 567 residents serving on its board or governing body and whether 568 that individual has a vote or is serving in a nonvoting, ex 569 officio capacity. 570 Section 12.Subsections (1) and (6) of section 651.105, 571 Florida Statutes, are amended to read: 572 651.105Examination. 573 (1)(a)The office may at any time, and shall at least once 574 every 3 years, examine the business of any applicant for a 575 certificate of authority and any provider engaged in the 576 execution of care contracts or engaged in the performance of 577 obligations under such contracts, in the same manner as is 578 provided for the examination of insurance companies pursuant to 579 ss. 624.316 and 624.318. For a provider as deemed accredited 580 under s. 651.028, such examinations must take place at least 581 once every 5 years. The examination must cover the preceding 3 582 or 5 fiscal years of the provider, whichever is applicable, and 583 must be commenced within 12 months after the end of the most 584 recent fiscal year covered by the examination. The examination 585 may include events subsequent to the end of the most recent 586 fiscal year and the events of any prior period which affect the 587 present financial condition of the provider. As part of the 588 examination, the office shall conduct an interview in person, 589 telephonically, or through electronic communication with the 590 current president or chair of the residents council, or another 591 designated officer of the council if the president or chair is 592 not available. 593 (b)Such examinations must be made by a representative or 594 examiner designated by the office whose compensation will be 595 fixed by the office pursuant to s. 624.320. Routine examinations 596 may be made by having the necessary documents submitted to the 597 office; and, for this purpose, financial documents and records 598 conforming to commonly accepted accounting principles and 599 practices, as required under s. 651.026, are deemed adequate. 600 The final written report of each examination must be filed with 601 the office and, when so filed, constitutes a public record. Any 602 provider being examined shall, upon request, give reasonable and 603 timely access to all of its records. The representative or 604 examiner designated by the office may at any time examine the 605 records and affairs and inspect the physical property of any 606 provider, whether in connection with a formal examination or 607 not. 608 (6)A representative of the provider must give a copy of 609 the final examination report and corrective action plan, if one 610 is required by the office, to the executive officer of the 611 governing body of the provider within 60 days after issuance of 612 the report. 613 Section 13.Subsection (7) of section 651.118, Florida 614 Statutes, is amended to read: 615 651.118Agency for Health Care Administration; certificates 616 of need; sheltered beds; community beds. 617 (7)Notwithstanding subsection (2), at the discretion of 618 the provider, sheltered nursing home beds may be used for 619 persons who are not residents of the continuing care facility 620 and who are not parties to a continuing care contract for up to 621 5 years after the date of issuance of the initial nursing home 622 license. A provider whose 5-year period has expired or is 623 expiring may request an extension from the Agency for Health 624 Care Administration, not to exceed 30 percent of the total 625 sheltered nursing home beds or 30 sheltered beds, whichever is 626 greater, if the utilization by residents of the nursing home 627 facility in the sheltered beds will not generate sufficient 628 income to cover nursing home facility expenses, as evidenced by 629 one of the following: 630 (a)The nursing home facility has a net loss for the most 631 recent fiscal year as determined under generally accepted 632 accounting principles, excluding the effects of extraordinary or 633 unusual items, as demonstrated in the most recently audited 634 financial statement. 635 (b)The nursing home facility would have had a pro forma 636 loss for the most recent fiscal year, excluding the effects of 637 extraordinary or unusual items, if revenues were reduced by the 638 amount of revenues from persons in sheltered beds who were not 639 residents, as reported by a certified public accountant. 640 641 The Agency for Health Care Administration may grant an extension 642 to the provider based on the evidence required in this 643 subsection. The Agency for Health Care Administration may 644 request a continuing care facility to use up to 25 percent of 645 the patient days generated by new admissions of nonresidents 646 during the extension period to serve Medicaid recipients for 647 those beds authorized for extended use if there is a 648 demonstrated need in the respective service area and if funds 649 are available. A provider who obtains an extension is prohibited 650 from applying for additional sheltered beds under subsection 651 (2), unless additional residential units are built or the 652 provider can demonstrate need by continuing care facility 653 residents to the Agency for Health Care Administration. The 5 654 year limit does not apply to sheltered beds designated for post 655 acute care as part of a contractual agreement with a health care 656 delivery system with at least one facility licensed under 657 chapter 395 or up to five sheltered beds designated for 658 inpatient hospice care as part of a contractual arrangement with 659 a hospice licensed under part IV of chapter 400. A continuing 660 care facility that uses such beds after the 5-year period shall 661 report such use to the Agency for Health Care Administration. 662 For purposes of this subsection, resident means a person who, 663 upon admission to the continuing care facility, initially 664 resides in a part of the continuing care facility not licensed 665 under part II of chapter 400, or who contracts for continuing 666 care at-home. 667 Section 14.Section 651.012, Florida Statutes, is amended 668 to read: 669 651.012Exempted facility; written disclosure of 670 exemption.Any facility exempted under ss. 632.637(1)(e) and 671 651.011(24) ss. 632.637(1)(e) and 651.011(23) must provide 672 written disclosure of such exemption to each person admitted to 673 the facility. This disclosure must be written using language 674 likely to be understood by the person and must briefly explain 675 the exemption. 676 Section 15.Subsection (1) of section 651.0261, Florida 677 Statutes, is amended to read: 678 651.0261Quarterly and monthly statements. 679 (1)Within 45 days after the end of each fiscal quarter, 680 each provider shall file a quarterly unaudited financial 681 statement of the provider or of the facility in the form 682 prescribed by commission rule and days cash on hand, occupancy, 683 debt service coverage ratio, and a detailed listing of the 684 assets maintained in the liquid reserve as required under s. 685 651.035. The last quarterly statement for a fiscal year is not 686 required if a provider does not have pending a regulatory action 687 level event, impairment, or a corrective action plan. If a 688 provider falls below two or more of the thresholds set forth in 689 s. 651.011(26) s. 651.011(25) at the end of any fiscal quarter, 690 the provider shall submit to the office, at the same time as the 691 quarterly statement, an explanation of the circumstances and a 692 description of the actions it will take to meet the 693 requirements. 694 Section 16.This act shall take effect July 1, 2023.