SB1522 - Relating to the regulation of continuing care facilities.

      S.B. No. 1522         AN ACT   relating to the regulation of continuing care facilities.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 246.002, Health and Safety Code, is   amended by amending Subdivisions (1), (5), (6), and (7) and adding   Subdivisions (1-a) and (8-a) to read as follows:                (1)   "Assisted living facility" has the meaning   assigned by Section 247.002.                   (1-a)  "Board" means the Texas Department [ State Board ]   of Insurance.                (5)  "Entrance fee" means an initial or deferred   transfer of money or other property valued at an amount exceeding   three months' payments for residency in a living unit and related   services at a facility [ rent or services, ] made, or promised to be   made, as full or partial consideration for acceptance by a provider   of a specified individual entitled to receive continuing care under   a continuing care contract.  The term does not include a deposit   made under a reservation agreement or amounts paid for an optional   modification to a living unit under an agreement separate from a   continuing care contract .                (6)  "Facility" means an establishment that provides   continuing care to an individual.  The term includes [ does not   include ] an individual's residence [ if the residence is not a   living unit provided by a provider ].                (7)  "Living unit" means a room, apartment, cottage, or   other area that is in a facility and that is set aside for the   exclusive use or control of one or more specified individuals.   The   term does not include a room, apartment, cottage, or other area that   is in a nursing facility or assisted living facility.                 (8-a) "Nursing facility" has the meaning assigned by   Section 242.301.            SECTION 2.  Section 246.0025, Health and Safety Code, is   amended to read as follows:          Sec. 246.0025.  DEFINITION OF CONTINUING CARE. (a)  In this   chapter, "continuing care" means to provide the following care   under a continuing care contract to an individual who is not related   by consanguinity or affinity, as determined under Chapter 573,   Government Code, to the person providing the care:                 (1)   the furnishing of a living unit and related   services; and                 (2)     an agreement to provide priority, guaranteed, or   discounted access to progressive levels of health care services to   an individual as necessary [ , together with personal care services,   nursing services, medical services, or other health-related   services ], regardless of whether the services are provided at the   same facility in which [ and ] the living unit is located or whether   the services are provided through a contract with a third party,   including the provision of health care services:                       (A)     in an assisted living facility or nursing   facility; and                       (B)     by a home and community support services   agency, as defined by Section 142.001 [ are provided at the same   location:                [ (1)     to an individual who is not related by   consanguinity or affinity, as determined under Chapter 573,   Government Code, to the person furnishing the care; and                [ (2)  under a continuing care contract ].          (b)  The term "continuing care" includes the furnishing of   services under a continuing care contract with an agreement to   provide priority, guaranteed, or discounted access to progressive   levels of health care services to an individual as necessary,   [ described by Subsection (a) ] to enable [ an individual in the   individual's residence or otherwise enabling ] the individual to   remain in the individual's residence.          SECTION 3.  Section 246.004, Health and Safety Code, is   amended to read as follows:          Sec. 246.004.  RIGHTS OF RESIDENTS. (a) A resident   receiving care in a portion of a facility licensed to provide   nursing home care[ , personal care, ] or assisted living services   [ custodial care ] is entitled to all statutory rights provided to a   resident of a  nursing home[ , personal care, ] or an assisted living   facility, as applicable  [ custodial care resident ].           (b)     A continuing care contract or reservation agreement may   not prohibit residents from assembling.           (c)     A facility shall provide to a resident, prospective   resident, or designated agent of a resident or prospective   resident, on request, an electronic or hard copy of the most recent   revised disclosure statement filed by the provider under Section   246.054.          SECTION 4.  Subchapter B, Chapter 246, Health and Safety   Code, is amended by adding Section 246.0215 to read as follows:           Sec.   246.0215.     APPLICABILITY. This chapter does not apply   to an admission or residence agreement offered by a residential   community that charges an entrance fee if:                 (1)     residents of the residential community pay for   available assisted living services and nursing home care on a   fee-for-service basis;                 (2)     fees for available assisted living services and   nursing home care are the same for a prospective resident as a   current resident of the living unit; and                 (3)     the admission or residence agreement includes the   following statement or a substantially equivalent statement in type   that is boldfaced, capitalized, underlined, or otherwise set out   from the surrounding written material so as to be conspicuous:                 "A continuing care contract provides priority,   guaranteed, or discounted access to progressive levels of health   care services.   ____________ (Name of community or facility) is not   a licensed continuing care facility and does not hold a certificate   of authority from the Texas Department of Insurance. This   agreement is not a continuing care contract and is exempt from the   requirements of Chapter 246, Health and Safety Code."          SECTION 5.  Section 246.022, Health and Safety Code, is   amended by amending Subsection (c) and adding Subsection (c-1) to   read as follows:          (c)   Except as provided by Subsection (c-1), the [ The ]   commissioner shall grant an application for a certificate of   authority if the commissioner finds that:                (1)  the applicant or the facility is financially   sound;                (2)  the competence, experience, and integrity of the   applicant, its board of directors, its officers, or its management   make it in the public interest to issue the certificate; and                (3)  the applicant is capable of complying with this   chapter.           (c-1)     The commissioner may reject an application for a   certificate of authority under Subsection (c) if the applicant does   not own the real property on which the facility is located or   proposed to be located.          SECTION 6.  Section 246.055, Health and Safety Code, is   amended to read as follows:          Sec. 246.055.  ADVERTISEMENT IN CONFLICT WITH DISCLOSURES.   (a) A provider may not engage in any type of advertisement for a   continuing care contract or facility if the advertisement contains   a statement or representation in conflict with the disclosures   required under this subchapter.           (b)     A person may not use the title "continuing care   facility" or "continuing care retirement community" in advertising   materials unless the person holds a certificate of authority issued   under this chapter.          SECTION 7.  Sections 246.056(c) and (d), Health and Safety   Code, are amended to read as follows:          (c)  If a continuing care contract is rescinded under this   section, the entrance fee [ any money or property transferred to the   provider, other than periodic charges specified in the contract and   applicable only to the period a living unit was actually occupied by   the resident, ] shall be refunded not later than the 30th day after   the date of rescission.          (d)  Each continuing care contract must include the   following statement or a substantially equivalent statement in type   that is boldfaced, capitalized, underlined, or otherwise set out   from the surrounding written material so as to be conspicuous:          "You may cancel this contract at any time prior to midnight of   the seventh day, or a later day if specified in the contract, after   the date on which you sign this contract or you receive the   facility's disclosure statement, whichever occurs later. If you   elect to cancel the contract, you must do so by written notice and   you will be entitled to receive a refund of the entrance fee [ all   assets transferred other than periodic charges applicable to your   occupancy of a living unit ]."          SECTION 8.  Section 246.057(b), Health and Safety Code, is   amended to read as follows:          (b)  If a continuing care contract is canceled under this   section, the resident or the resident's legal representative is   entitled to a refund of all money or property transferred to the   provider, minus:                (1)  any nonstandard costs specifically incurred by the   provider or facility at the request of the resident that are   described in the contract or in an addendum to the contract signed   by the resident; [ and ]                (2)  a reasonable service charge, if set out in the   contract, that may not exceed the greater of $1,000 or two percent   of the entrance fee ; and                 (3)     any money transferred to the provider for optional   modifications to the resident's or prospective resident's living   unit under an agreement that is separate from the continuing care   contract .          SECTION 9.  Section 246.071(a), Health and Safety Code, is   amended to read as follows:          (a)   If a [ Before a ] provider accepts [ may accept ] the   payment of a deposit made under a reservation agreement or any   portion of an entrance fee before the date the prospective resident   may occupy a living unit , the provider must establish an entrance   fee escrow account with a bank or trust company, as escrow agent,   that is located in this state.          SECTION 10.  Section 246.072, Health and Safety Code, is   amended to read as follows:          Sec. 246.072.  RETURN OF DEPOSITS; RELEASE OR RETURN OF   ENTRANCE FEE. (a) On a written request from or on behalf of the   provider or a prospective resident, the escrow agent shall return   the amount on deposit to the person who paid the deposit if the   reservation agreement is terminated before the prospective   resident occupies the living unit [ or shall maintain the deposit as   an entrance fee in the entrance fee escrow account ].          (b)  Unless the escrow agent receives a written request from   or on behalf of a provider or a resident for the return of an   entrance fee under Subsection (a) [ Sectio [Text truncated for display. Full text available on LegiScan.]