Bill Text: CA AB1751 | 2013-2014 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Continuing care retirement communities.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2014-09-28 - Chaptered by Secretary of State - Chapter 699, Statutes of 2014. [AB1751 Detail]

Download: California-2013-AB1751-Amended.html

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BILL NUMBER: AB 1751	AMENDED
	BILL TEXT

	AMENDED IN SENATE  AUGUST 19, 2014
	AMENDED IN SENATE  JUNE 15, 2014
	AMENDED IN ASSEMBLY  MAY 23, 2014
	AMENDED IN ASSEMBLY  MAY 1, 2014
	AMENDED IN ASSEMBLY  MARCH 26, 2014

INTRODUCED BY   Assembly Member Bloom

                        FEBRUARY 14, 2014

   An act to amend Section 1771.8 of the Health and Safety Code,
relating to continuing care.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1751, as amended, Bloom. Continuing care retirement
communities.
   (1) Existing law provides for the regulation by the State
Department of Social Services of activities relating to continuing
care contracts that govern care provided to an elderly resident in a
continuing care retirement community for the duration of the resident'
s life or a term in excess of one year. Existing law declares the
Legislature's finding that the residents of continuing care
retirement communities have a unique and valuable perspective on the
operations of, and services provided in, the community in which they
live and should have input into decisions made by the provider.
   Existing law requires every continuing care retirement community
provider to make available to the resident association or its
governing body, or if neither exists, to a committee of residents, a
financial statement of activities for that facility comparing actual
costs to budgeted costs broken down by expense category, not less
than semiannually. Existing law also requires a provider to provide a
copy of the annual report at a central and conspicuous location in
the community. Under existing law, an entity that issues, delivers,
or publishes, or as manager or officer or in any other administrative
capacity, assists in the issuance, delivery, or publication of, any
printed matter, oral representation, or advertising material that
does not comply with the requirements of the law relating to
continuing care contracts is guilty of a misdemeanor.
   This bill would instead require the financial statement to be
provided not less than quarterly, and would require it to include a
written explanation of all significant budget variances. This bill
would additionally require a provider to make a copy of the annual
report available on its Internet Web site. By expanding the scope of
a crime, this bill would impose a state-mandated local program.
   (2) Existing law requires the governing body of a provider that is
not part of a multifacility organization with more than one
continuing care retirement community in the state to accept at least
one resident of the continuing care retirement community it operates
to participate as a nonvoting resident representative to the
governing body. Existing law requires the governing body of a
multifacility organization  to elect either to  
to either  have at least one nonvoting resident representative
to the provider's governing body for each California-based continuing
care retirement community the provider operates or to have a
resident-elected committee composed of representatives of the
residents of each California-based continuing care retirement
community that the provider operates select or nominate at least one
nonvoting resident representative to the provider's governing body
for every 3 California-based continuing care retirement communities
 ,  or fraction thereof  ,  that the provider
operates.
   This bill would additionally require the governing body of all
providers to accept at least one resident, or 2 residents for a
governing body with 21 or more members, from the continuing care
retirement community or communities it operates to participate as
voting members of the provider's governing body, and would make other
technical and conforming changes. The bill would require a resident
member to be nominated to participate on the provider's governing
body by the resident association or, if a resident association does
not exist, a committee of residents, and would authorize the resident
association or committee of residents to nominate multiple nominees
from which the provider's governing body may approve a resident
member. If the governing body disapproves of the resident association'
s nominations, the bill would require the resident association or
committee of residents to nominate additional resident members until
the vacancy is filled. This bill would authorize a provider that has
at least one continuing care retirement community in the state and
does not have a governing body within the state to, in lieu of
appointing a resident to be a voting member of its governing body,
appoint a select committee of its governing body members to meet with
the resident association or a resident elected committee of
residents, as specified, no less frequently than at a reasonable
period prior to any regularly scheduled meeting of the governing body
at each of its facilities in the state to address concerns of the
residents and to ensure that the opinions of residents are relayed to
all governing body members of the provider.  The bill would also
provide for alternative representation options for a provider that
is a sole proprietorship, general partnership, limited partnership,
limited liability company, or a closely held corporation in lieu of
appointing a resident as a voting member of the provider's governing
body, as specified. 
   (3) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 1771.8 of the Health and Safety Code is amended
to read:
   1771.8.  (a) The Legislature finds and declares all of the
following:
   (1) The residents of continuing care retirement communities have a
unique and valuable perspective on the operations of, and services
provided in, the community in which they live.
   (2) Resident input into decisions made by the provider is an
important factor in creating an environment of cooperation, reducing
conflict, and ensuring timely response and resolution to issues that
may arise.
   (3) Continuing care retirement communities are strengthened when
residents know that their views are heard and respected.
   (b) The Legislature encourages continuing care retirement
communities to exceed the minimum resident participation requirements
established by this section by, among other things, the following:
   (1) Encouraging residents to form a resident association, and
assisting the residents, the resident association, and its governing
body to keep informed about the operation of the continuing care
retirement community.
   (2) Encouraging residents of a continuing care retirement
community or their elected representatives to select residents to
participate as members of the governing body of the provider.
   (3) Quickly and fairly resolving any dispute, claim, or grievance
arising between a resident and the continuing care retirement
community.
   (c) The governing body of a provider, or the designated
representative of the provider, shall hold, at a minimum, semiannual
meetings with the residents of the continuing care retirement
community, or the resident association or its governing body, for the
purpose of the free discussion of subjects including, but not
limited to, income, expenditures, and financial trends and issues as
they apply to the continuing care retirement community and proposed
changes in policies, programs, and services. This section does not
preclude a provider from taking action or making a decision at any
time, without regard to the meetings required under this subdivision.

   (d) At least 30 days prior to the implementation of an increase in
the monthly care fee, the designated representative of the provider
shall convene a meeting, to which all residents shall be invited, for
the purpose of discussing the reasons for the increase, the basis
for determining the amount of the increase, and the data used for
calculating the increase. This meeting may coincide with the
semiannual meetings required in subdivision (c). At least 14 days
prior to the meeting to discuss an increase in the monthly care fee,
the provider shall make available to each resident or resident
household comparative data showing the budget for the upcoming year,
the current year's budget, and actual and projected expenses for the
current year, and a copy shall be posted in a conspicuous location at
each facility.
   (e) The governing body of a provider or the designated
representative of the provider shall provide residents with at least
14 days' advance notice of each meeting provided for in subdivisions
(c) and (d), and shall permit residents attending the meeting to
present issues orally and in writing. The governing body of a
provider or the designated representative of the provider shall post
the notice of, and the agenda for, the meeting in a conspicuous place
in the continuing care retirement community at least 14 days prior
to the meeting. The governing body of a provider or the designated
representative of the provider shall make available to residents of
the continuing care retirement community upon request the agenda and
accompanying materials at least seven days prior to the meeting.
   (f) A provider shall make available to the resident association or
its governing body, or if neither exists, to a committee of
residents, a financial statement of activities for that facility
comparing actual costs to budgeted costs broken down by expense
category, not less than quarterly, with a written explanation of all
significant budget variances, and shall consult with the resident
association or its governing body, or, if neither exists, with a
committee of residents, during the annual budget planning process.
The effectiveness of consultations during the annual budget planning
process shall be evaluated at a minimum every two years by the
continuing care retirement community administration. The evaluation,
including any policies adopted relating to cooperation with
residents, shall be made available to the resident association or its
governing body, or, if neither exists, to a committee of residents
at least 14 days prior to the next semiannual meeting of residents
and the provider's governing body provided for in subdivision (c),
and a copy of the evaluation shall be posted in a conspicuous
location at each facility.
   (g) A provider shall, within 10 days after the annual report
required pursuant to Section 1790 is submitted to the department,
provide, at a central and conspicuous location in the community and
in a conspicuous location on the provider's Internet Web site, a copy
of the annual report, including the multifacility statement of
activities and a copy of the annual audited financial statement, but
excluding personal confidential information.
   (h) A provider shall maintain, as public information, available
upon request to residents, prospective residents, and the public,
minutes of the meetings held by the provider's governing body and
shall retain these records for at least three years from the date the
records were filed or issued.
   (i) Except as provided in subdivision (s), the governing body of a
provider that is not part of a multifacility organization with more
than one continuing care retirement community in the state shall
accept both of the following:
   (1) At least one resident of the continuing care retirement
community it operates to participate as a nonvoting resident
representative to the provider's governing body.
   (2) At least one resident, or two residents for a governing body
with 21 or more members, of the continuing care retirement community
it operates to participate as a voting member of the provider's
governing body. A provider's governing body shall not be required to
meet the requirements of this paragraph until there is a vacancy on
the provider's governing body or upon the next regularly scheduled
selection of the provider's governing body occurring on or after
January 1, 2015. A resident member shall perform his or her duties in
a manner that complies with the standards of conduct and fiduciary
duties of all other members of the governing board.
   (j) Except as provided in subdivision (s), in a multifacility
organization having more than one continuing care retirement
community in the state, the governing body of the multifacility
organization shall do both of the following:
   (1) Elect either to have at least one nonvoting resident
representative to the provider's governing body for each
California-based continuing care retirement community the provider
operates or to have a resident-elected committee composed of
representatives of the residents of each California-based continuing
care retirement community that the provider operates select or
nominate at least one nonvoting resident representative to the
provider's governing body for every three California-based continuing
care retirement communities, or fraction thereof, that the provider
operates. If a multifacility organization elects to have one
representative for every three communities that the provider
operates, the provider shall provide to the president of the
residents association of each of the communities that do not have a
resident representative the same notice of meetings, packets,
minutes, and other materials as the resident representative. At the
reasonable discretion of the provider, information related to
litigation, personnel, competitive advantage, or confidential
information that is not appropriate to disclose, may be withheld.
   (2) (A) Elect to have at least one resident, or two residents for
a governing body with 21 or more members, from any of the continuing
care retirement communities it operates to participate as voting
members of the provider's governing body. A provider's governing body
shall not be required to meet the requirements of this subparagraph
until there is a vacancy on the provider's governing body or upon the
next regularly scheduled selection of the provider's governing body
occurring on or after January 1, 2015. A resident member shall
perform his or her duties in a manner that complies with the
standards of conduct and fiduciary duties of all other members of the
governing board.
   (B) If there are communities that do not have a resident from the
community as a voting member of the provider's governing body, the
provider shall provide to the president of the resident association
of each of those communities the same notice of meetings, packets,
minutes, and other materials as the resident voting members. At the
reasonable discretion of the provider, information related to
litigation, personnel, competitive advantage, or confidential
information that is not appropriate to disclose may be withheld.
   (k) In order to encourage innovative and alternative models of
resident involvement, residents selected pursuant to paragraph (1) of
subdivision (i) or paragraph (1) of subdivision (j) to participate
as a resident representative to the provider's governing body may, at
the option of the resident association, be selected in any one of
the following ways:
   (1) By a majority vote of the resident association of a provider
or by a majority vote of a resident-elected committee of residents of
a multifacility organization.
   (2) If no resident association exists, any resident may organize a
meeting of the majority of the residents of the continuing care
retirement community to select or nominate residents to represent
them on the governing body.
   (3) Any other method designated by the resident association.
   (l) A resident member of the provider's governing body selected
pursuant to paragraph (2) of subdivision (i) or paragraph (2) of
subdivision (j) shall be nominated to participate on the provider's
governing body by the resident association or, if a resident
association does not exist, a committee of residents. The resident
association or committee of residents may nominate multiple nominees
from which the provider's governing body may approve a resident
member. If the governing body disapproves of the resident association'
s nominations, the resident association or the committee of residents
shall nominate additional resident members for the governing body's
approval or disapproval until the vacancy is filled.
   (m) The resident association, organizing resident, or, in the case
of a multifacility organization, the resident-elected committee of
residents, shall give residents of the continuing care retirement
community at least 30 days' advance notice of the meeting to select a
resident representative and resident members of the governing body
and shall post the notice in a conspicuous place at the continuing
care retirement community.
   (n) (1) Except as provided in subdivision (o), resident
representatives shall receive the same notice of meetings, packets,
minutes, and other materials as members of the provider's governing
body and shall be permitted to attend, speak, and participate in all
meetings of the governing body.
   (2) Resident representatives may share information from meetings
with other residents, unless the information is confidential or doing
so would violate fiduciary duties to the provider. A resident
representative shall be permitted to attend meetings of the governing
body committee or committees that review the annual budget of the
facility or facilities and recommend increases in monthly care fees.
The resident representative shall receive the same notice of
meetings, information, packets, minutes, and other materials as
committee members, and shall be permitted to attend, speak, and
participate in the committee meetings. Resident representatives shall
perform their duties in good faith and with such care, including
reasonable inquiry, as an ordinarily prudent person in a like
position would use under similar circumstances.
   (o) Notwithstanding subdivision (n), the provider's governing body
may exclude resident representatives from its executive sessions and
from receiving meeting materials to be discussed during executive
session. However, resident representatives shall be included in
executive sessions and shall receive all meeting materials to be
discussed during executive sessions related to discussions of the
annual budgets, increases in monthly care fees, indebtedness, and
expansion of new and existing continuing care retirement communities.

   (p) The provider shall pay all reasonable travel costs for
resident representatives and resident members of the governing body.
   (q) The provider shall disclose in writing the extent of resident
involvement with the governing body to prospective residents.
   (r) A provider is not prohibited from exceeding the minimum
resident participation requirements of this section by, for example,
having more resident meetings, more resident representatives or
resident members of the governing body to the provider's governing
body than required, or by having one or more residents on the
provider's governing body who are selected with the active
involvement of residents.
   (s)  (1)    If a provider having at least one
continuing care retirement community in the state does not have a
governing body within the state, the provider shall, in lieu of
appointing a voting member pursuant to subdivision (i) or (j),
appoint a select committee of its governing body members to meet
pursuant to paragraph (6) of subdivision (a) of Section 307 of the
Corporations Code, or in a location that has been designated in the
notice of the meeting, with the resident association or a
resident-elected committee of residents no less frequently than a
reasonable period prior to any regularly scheduled meeting of the
governing body at each of its facilities in the state to address
concerns of the residents and to ensure that the opinions of  the
 residents are relayed to all governing body members of the
provider. 
   (2) (A) For a provider that is a sole proprietorship, general
partnership, limited partnership, limited liability company, or a
closely held corporation, the provider may, in lieu of appointing a
voting member pursuant to paragraph (2) of subdivision (i) or
paragraph (2) of subdivision (j), appoint a select committee of its
members to, or, if it is a sole proprietorship, the sole proprietor
shall, meet in a location that has been designated in the notice of
the meeting with the resident association or a resident-elected
committee of residents at each of its facilities semiannually and at
least 60 days prior to any financial or administrative changes,
including, but not limited to, any proposed increase in monthly fees,
indebtedness of the provider, expansion or contraction of the
community facility, or other changes that would result in a budget
variance, or any policies, programs, or services that would
materially change the operation or environment of the community, to
address concerns of the residents and to ensure that the opinions of
the residents are relayed to all members of the provider.  
   (B) If any member of a limited liability company is a corporation,
a nonvoting resident representative elected pursuant to paragraph
(1) of subdivision (i) or paragraph (1) of subdivision (j) shall be
invited to the meetings of the governing body of that corporation
that address any of the proposed changes specified in subparagraph
(A) and shall be permitted to address those proposed changes. The
governing body of the corporation shall provide the nonvoting
resident representative with at least 30 days' advance notice of the
meeting. If more than one member of the limited liability company is
a corporation, only the corporation with the largest interest in the
limited liability company shall comply with this subparagraph. 
  SEC. 2.  No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.