WES MOORE, Governor Ch. 817
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Chapter 817
(House Bill 1122)
AN ACT concerning
Maryland Health Care Commission – Nursing Homes – Acquisitions
FOR the purpose of requiring a person, before making a contractual agreement for the
closing on an acquisition of a nursing home, to submit a request for acquisition to
the Maryland Health Care Commission and provide certain notice to certain
individuals; establishing requirements regarding the approval or denial of a request
for acquisition; providing for judicial review of a final decision of the Commission
regarding a request for acquisition of a nursing home; requiring a person who
acquires a nursing home to submit a certain report to the Commission on a certain
basis; and generally relating to the acquisition of a nursing home.
BY repealing and reenacting, without amendments,
Article – Health – General
Section 19–114(a)
Annotated Code of Maryland
(2023 Replacement Volume)
BY adding to
Article – Health – General
Section 19–114(a–1) and 19–120.2
Annotated Code of Maryland
(2023 Replacement Volume)
BY repealing and reenacting, with amendments,
Article – Health – General
Section 19–115, 19–120(k)(6)(ii), 19–1401.1, and 19–1401.2
Annotated Code of Maryland
(2023 Replacement Volume)
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
That the Laws of Maryland read as follows:
Article – Health – General
19–114.
(a) In this Part II of this subtitle the following words have the meanings
indicated.
(A–1) “ACQUISITION” MEANS:
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(1) A TRANSFER OF STOCK OR ASSETS THAT RESULTS IN A CHANGE
OF THE PERSON THAT C ONTROLS A HEALTH CAR E FACILITY; OR
(2) THE TRANSFER OF MORE THAN 25% OF STOCK OR OWNERSHI P
INTEREST IN A HEALTH CARE FACILITY.
19–115.
(a) In addition to the duties set forth elsewhere in this subtitle, in this Part II of
this subtitle, the Commission shall:
(1) Act as the State agency to represent the State under Title VI of the
federal Public Health Service Act; AND
(2) Periodically participate in or perform analyses and studies that relate
to:
(i) Adequacy of services and financial resources to meet the needs of
the population;
(ii) Distribution of health care resources;
(iii) Allocation of health care resources;
(iv) Costs of health care in relationship to available financial
resources; or
(v) Any other appropriate matter[; and
(3) When evaluating a notice of acquisition or transfer of interest of a
nursing home in accordance with § 19–120(k)(6)(ii) of this title, provide the Commission’s
written findings and recommendations to the Office of Health Care Quality, including:
(i) Quality ratings of facilities currently or previously owned, within
or outside the State, by the purchaser of the health care facility, based on the most recent
Five–Star Quality Rating System established by the Centers for Medicare and Medicaid
Services;
(ii) For the immediately preceding 3–year period:
1. Evidence that facilities currently or previously owned,
within or outside the State, by the purchaser of the health care facility maintained quality
assessment and assurance committees that met at least quarterly;
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2. Inspection of care reports and corrective action plans of
facilities currently or previously owned, within or outside the State, by the purchaser of the
health care facility;
3. Licensing and certification surveys and corrective action
plans of facilities currently or previously owned, within or outside the State, by the
purchaser of the health care facility; and
4. Lawsuits or arbitration filings by any patient or patient
representative against facilities currently or previously owned, within or outside the State,
by the purchaser of the health care facility;
(iii) The Tax Identification Number of each purchaser; and
(iv) The personal Centers for Medicare and Medicaid Services
Certification Number of each purchaser].
[(b) The findings and recommendations required to be provided to the Office of
Health Care Quality under subsection (a)(3) of this section shall include a summary of the
findings and the basis for the recommendations.]
[(c)] (B) In addition to the duties set forth elsewhere in this Part II of this
subtitle, the Governor shall direct, as necessary, a State officer or agency to cooperate in
carrying out the functions of the Commission.
[(d)] (C) This State recognizes the federal act and any amendment to the federal
act that does not require State legislation to be effective. However, if the federal act is
repealed or expires, this Part II of this subtitle remains in effect.
19–120.
(k) (6) This subsection does not apply to:
(ii) Acquisition AN ACQUISITION of a health care facility if[, at]:
1. AT least 30 days before making the contractual
arrangement to acquire the facility, written notice of the intent to make the arrangement
is filed with the Commission and the Commission does not find, within 30 days after the
Commission receives notice, that the health services or bed capacity of the facility will be
changed, provided that, for a merger with or acquisition of an existing general hospice, the
purchaser of the general hospice may only acquire the authority to provide home–based
hospice services in jurisdictions in which the seller of the general hospice is licensed to
provide home–based hospice services; AND OR AND
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2. THE FACILITY IS A NUR SING HOME AND FOR AN
ACQUISITION OF A NUR SING HOME, THE ACQUISITION HAS BEEN APPROVED IN
ACCORDANCE WITH § 19–120.2 OF THIS SUBTITLE;
19–120.2.
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS
INDICATED.
(2) “EXECUTIVE DIRECTOR” MEANS THE EXECUTIVE DIRECTOR OF
THE COMMISSION.
(3) “NURSING HOME ” HAS THE MEANING STAT ED IN § 19–1401 OF
THIS TITLE.
(4) “REQUEST FOR ACQUISITI ON” MEANS A REQUEST FOR THE
COMMISSION TO APPROVE THE ACQUISITION OF A NURSING HOME .
(B) A PERSON SHALL PROVIDE NOTICE TO THE COMMISSION AT LEAST 30
DAYS BEFORE THE CLOS ING OF A CHANGE OF O WNERSHIP OF A NURSIN G HOME
THAT:
(1) INVOLVES AT LEAST A 5% TRANSFER IN OWNERSHI P INTEREST;
AND
(2) IS NOT AN ACQUISITION THAT REQUIRES APPROV AL UNDER
SUBSECTION (C) OF THIS SECTION.
(B) (C) (1) THIS SUBSECTION DOES NOT APPLY TO AN ACQU ISITION
THAT INVOLVES ONLY C HANGES OF OWNERSHIP INTERESTS AMONG EXIS TING
OWNERS OF A NURSING HOME.
(2) AT LEAST 120 60 DAYS BEFORE MAKING A CONTRACTUAL
ARRANGEMENT FOR THE CLOSING DATE OF THE ACQUISITION OF A NURSING HOME ,
A PERSON SHALL :
(1) (I) SUBMIT TO THE COMMISSION A REQUEST FOR
ACQUISITION; AND
(2) (II) PROVIDE NOTICE TO THE RESIDENTS, RESIDENT
REPRESENTATIVES , AND STAFF EMPLOYEES OF THE NURSING HOME THAT:
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(I) 1. THE REQUEST FOR ACQUI SITION WAS SUBMITTED TO
THE COMMISSION; AND
(II) 2. THERE WILL BE AN OPPO RTUNITY TO SUBMIT
COMMENTS IN ACCORDAN CE WITH SUBSECTION (E) (F) OF THIS SECTION.
(C) (D) (1) THE EXECUTIVE DIRECTOR SHALL REVIEW A COMPLETED
REQUEST FOR ACQUISIT ION WITHIN 60 45 DAYS AFTER RECEIVING THE COMPLETED
REQUEST FROM THE APPLICANT .
(2) THE EXECUTIVE DIRECTOR, IN CONSULTATION WITH THE
SECRETARY OR THE SECRETARY’S DESIGNEE, MAY:
(I) APPROVE THE ACQUISITI ON;
(II) APPROVE THE ACQUISITI ON WITH CONDITIONS ;
(III) DENY THE ACQUISITION ; OR
(IV) REFER THE REQUEST FOR ACQUISITION TO THE
COMMISSION FOR A FINA L DECISION.
(D) (E) TO APPROVE A REQUEST SUBMITTED UNDER SUBS ECTION (B) (C)
OF THIS SECTION, THE EXECUTIVE DIRECTOR MUST FIND TH AT THE ACQUISITION :
(1) IS CONSISTENT WITH TH E STATE HEALTH PLAN; AND
(2) WILL RESULT IN THE DE LIVERY OF MORE EFFIC IENT AND
EFFECTIVE HEALTH CAR E SERVICES; AND
(3) SUBJECT TO SUBSECTION (E) (F) OF THIS SECTION , IS IN THE
PUBLIC INTEREST .
(E) (F) IN DETERMINING WHETHE R AN ACQUISITION OF A NURSING HOME
IS IN THE PUBLIC INT EREST, THE EXECUTIVE DIRECTOR SHALL :
(1) SOLICIT AND ACCEPT CO MMENTS FROM INDIVIDU ALS WHO:
(I) RESIDE IN THE NURSING HOME ;
(II) HAVE FAMILY MEMBERS W HO RESIDE IN THE NUR SING
HOME; OR
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(III) ARE EMPLOYED AT EMPLOYEES OF THE NURSING HOME ;
AND
(2) CONSULT WITH THE ATTORNEY GENERAL ON WHETHER TH E
ACQUISITION RAISES P UBLIC INTEREST CONCE RNS.
(F) (G) IF THE EXECUTIVE DIRECTOR REFERS A REQ UEST FOR
ACQUISITION TO THE COMMISSION UNDER SUBS ECTION (C)(2)(IV) (D)(2)(IV) OF
THIS SECTION , THE COMMISSION SHALL USE THE CRITERIA SPECIFI ED IN
SUBSECTION (D) SUBSECTIONS (E) AND (F) OF THIS SECTION OR AND REGULATION S
ADOPTED BY THE COMMISSION TO MAKE A FINAL DECISION WITHIN 60 DAYS AFTER
RECEIVING THE COMPLE TED REQUEST FROM THE APPLICANT.
(G) (H) IF THE EXECUTIVE DIRECTOR DENIES A REQ UEST FOR
ACQUISITION OR IMPOSES A CONDITI ON ON THE APPROVAL O F THE ACQUISITION , A
PERSON THAT IS AN INTERESTED A PARTY TO THE ACQUISI TION MAY SUBMIT A
WRITTEN REQUEST FOR THE COMMISSION TO REVIEW THE DECISION IN
ACCORDANCE WITH REGU LATIONS ADOPTED BY T HE COMMISSION.
(H) (I) (1) A DECISION OF THE COMMISSION UNDER SUBS ECTION (F)
OR (G) (G) OR (H) OF THIS SECTION SHAL L BE A FINAL DECISIO N FOR THE PURPOSE
OF JUDICIAL REVIEW .
(2) A PERSON THAT IS AN INTERESTED A PARTY TO THE ACQUISI TION
MAY TAKE A DIRECT JU DICIAL APPEAL WITHIN 30 DAYS AFTER THE COMMISSION
MAKES THE FINAL DECI SION.
(3) THE COMMISSION SHALL SEND EACH FINAL DECISION TO THE
SECRETARY, THE SECRETARY OF AGING, THE OFFICE OF HEALTH CARE QUALITY,
AND THE OFFICE OF THE ATTORNEY GENERAL, AND THE STATE LONG–TERM CARE
OMBUDSMAN .
(I) (J) (1) ON OR BEFORE JULY 1 IMMEDIATELY F OLLOWING THE
ACQUISITION OF A NUR SING HOME AND EVERY EACH YEAR FOR 3 YEARS
THEREAFTER , THE PERSON THAT ACQU IRED THE NURSING HOM E SHALL SUBMIT A
REPORT TO THE COMMISSION IN ACCORDA NCE WITH REGULATIONS ADOPTED BY
THE COMMISSION.
(2) THE COMMISSION SHALL PROV IDE THE REPORT REQUI RED
UNDER PARAGRAPH (1) OF THIS SUBSECTION T O THE SECRETARY, THE SECRETARY
OF AGING, THE OFFICE OF HEALTH CARE QUALITY, AND THE OFFICE OF THE
ATTORNEY GENERAL, AND THE STATE LONG–TERM CARE OMBUDSMAN .
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(J) (K) (1) THE COMMISSION SHALL ADOP T REGULATIONS THROUGH
AN UPDATE TO THE STATE HEALTH PLAN FOR FACILITIES AND SERVICES TO CARRY
OUT THE PROVISIONS O F THIS SECTION.
(2) THE REGULATIONS ADOPT ED UNDER THIS SUBSEC TION SHALL:
(I) REQUIRE THE PERSON TH AT ACQUIRED OWNERSHIP O F A
NURSING HOME TO :
1. REDUCE THE NUMBER OF RESIDENT ROOMS IN TH E
NURSING HOME THAT CO NTAIN MORE THAN TWO BEDS IN ACCORDANCE W ITH
STANDARDS ESTABLISHE D BY THE COMMISSION; OR
2. RECEIVE A WAIVER FROM THE REQUIREMENT
ESTABLISHE D UNDER ITEM 1 OF THIS ITEM FROM TH E EXECUTIVE DIRECTOR IN
ACCORDANCE WITH STAN DARDS ESTABLISHED BY THE COMMISSION;
(II) 1. IF NECESSARY, ALLOW THE PERSON THA T ACQUIRED
OWNERSHIP OF A NURSI NG HOME TO TEMPORARI LY DELICENSE BEDS FO R AT LEAST
3 YEARS IMMEDIATELY FOLLOWIN G THE ACQUISITION TO REDUCE THE NUMBER OF
RESIDENT ROOMS THAT CONTAIN MORE THAN TW O BEDS; AND
2. AUTHORIZE THE COMMISSION TO EXTEND THE
PERIOD THE BEDS ARE TEMPORARILY DELICENS ED BEYOND 3 YEARS FOR GOOD
CAUSE SHOWN , INCLUDING DEMON STRATED PROGRESS TOW ARD ELIMINATING
MULTIBEDDED ROOMS BY EXPANDING THE EXISTI NG FACILITY OR TRANS FERRING
THE BEDS TO ANOTHER FACILITY WITHIN A ME RGED ASSET SYSTEM IN THE SAME
JURISDICTION;
(II) (III) ESTABLISH STANDARDS F OR THE EVALUATION OF
THE QUALITY OF THE FACILITIES NURSING HOMES CURRENTLY OR PREVIOU SLY
OWNED, WHETHER IN THE STATE OR OUTSIDE THE STATE, BY THE PERSON THAT
SUBMITTED A REQUEST FOR ACQUISITION ; AND
(III) (IV) SUBJECT TO PARAGRAPH (3) OF THIS SUBSECTION ,
ESTABLISH CRITERIA F OR THE EXECUTIVE DIRECTOR AND THE COMMISSION TO
CONSIDER WHEN MAKING A DECISION REGARDING A REQUEST FOR ACQUIS ITION.
(3) THE CRITERIA ESTABLIS HED BY THE COMMISSION UNDER
PARAGRAPH (2)(III) (2)(IV) OF THIS SUBSECTION S HALL REQUIRE THAT TH E
COMMISSION TAKE INTO CONSIDERATION WHETHE R ANY FACILITY NURSING HOME
CURRENTLY OR PREVIOU SLY OWNED, WITHIN OR OUTSIDE TH E STATE, BY THE
PERSON SUBMITTING TH E REQUEST, FOR THE PERIOD OF 3 YEARS IMMEDIATELY
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(I) MAINTAINED A QUALITY ASSESSMENT AND ASSUR ANCE
COMMITTEE THAT MET A T LEAST QUARTERLY ;
(II) WAS THE SUBJECT OF AN ENFORCEMENT ACTION , A
SPECIAL FOCUS FACILI TY DESIGNATION , SURVEY, OR PLAN OF CORRECTIO N OR A
DEFICIENCY INVOLVING SERIOUS OR IMMEDIATE THREAT, ACTUAL HARM , OR
IMMEDIATE JEOPARDY TO A RESIDENT; OR
(III) WAS THE SUBJECT OF A LAWSUIT, A JUDGMENT, OR AN
ARBITRATION FINDING , FOLLOWING A COMPLAIN T FILED BY A RESIDENT OR,
RESIDENT REPRESENTATIVE , OR A GOVERNMENT AGEN CY.
19–1401.1.
(a) (1) In addition to the requirements for licensure of a related institution as
provided in this title, an applicant for licensure of a nursing home shall include in the
application the identity of:
(i) Any person with an ownership interest in the nursing home; and
(ii) Any management company, landlord, or other business entity
that will operate or contract with the applicant to manage the nursing home.
(2) (i) The person acquiring a nursing home shall provide the
Department with written notice of the acquisition or change in operator at the same time
as the notice required under [§ 19–120(k)(6)(ii)] § 19–120.2 of this title is filed with the
Maryland Health Care Commission.
(ii) For other changes to the information required under paragraph
(1) of this subsection, the nursing home shall notify the Department within 30 days after
the effective date of the change.
(b) An applicant for licensure shall submit to the Secretary or the Secretary’s
designee evidence:
(1) That affirmatively demonstrates the ability of the applicant to comply
with minimum standards of:
(i) Medical care;
(ii) Nursing care;
(iii) Financial condition; and
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(iv) Other applicable State or federal laws and regulations; [and]
(2) Regarding the regulatory compliance history and financial condition of
any health care facility owned or operated by the applicant in other jurisdictions; AND
(3) THAT A REQUEST FOR AC QUISITION FOR THE NU RSING HOME WAS
APPROVED IN ACCORDAN CE WITH § 19–120.2 OF THIS TITLE.
19–1401.2.
[(a)] On review of the information required under § 19–1401.1 of this subtitle and
any other information that is relevant to the ability of the applicant to operate a nursing
home, the Secretary may:
(1) Approve an application for a license;
(2) Deny an application for a license;
(3) Approve an application for a license subject to conditions; or
(4) Revoke a license.
[(b) Before taking action on a license under subsection (a) of this section, the
Secretary shall consider any findings and recommendations DECISIONS of the Maryland
Health Care Commission provided to the Office of Health Care Quality under § 19–115 §
19–120.2 of this title.]
SECTION 2. AND BE IT FURTHER ENACTED, That the Maryland Health Care
Commission shall adopt the regulations required under § 19–120.2(j) of the Health –
General Article, as enacted by Section 1 of this Act, on or before January 1, 2025 to be
applicable to acquisitions executed after the adoption of the regulations.
SECTION 3. AND BE IT FURTHER ENACTED, That this Act sha ll take effect
October 1, 2024.
Approved by the Governor, May 16, 2024.