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The ‘most important nursing home bill in decades’ nears passage in California

By Eli Kirshbaum
State of Reform
May 23rd, 2022

According to supporters of Assembly Bill 1502, a number of nursing home operators in California are running their facilities without proper licenses, and their unregulated practices are significantly undermining patient care. The California Department of Public Health (CDPH), according to the bill, is allowing this to continue through lax oversight practices.

The bill aims to address these issues by requiring owners and operators of nursing homes in the state to receive licensure from CDPH—which includes being screened by the department—prior to acquiring the facilities. 

“Now that may sound obvious,” said bill sponsor Asm. Al Muratsuchi (D – Los Angeles) in the Assembly Health Committee in January. “Some of you may be wondering, ‘Doesn’t that [licensure] already happen?’ Well it doesn’t. And I want to make sure that everyone on this committee understands that there are currently nursing homes that are being operated that are unlicensed, and we need to correct that.”

AB 1502 was first introduced in February 2021. It passed the Assembly with a 55-15 vote in January of this year. It now awaits hearings in Senate committees.

The legislation also requires CDPH to post all licensure applications online, which will be subject to public comment before approval. The department must make decisions on applications within 120 days of their submission. Another key part of the bill, according to Muratsuchi, is its prohibition on the use of interim management agreements, which he says allows facilities to “circumvent the most basic of licensing requirements.”

CDPH’s Licensing and Certification (L&C) branch performs inspections of nursing facilities to ensure they comply with quality standards, but supporters of the legislation say this oversight isn’t adequate. The Assembly analysis of the bill states: “L&C has demonstrated a consistently poor record of completing investigations of health care facility complaints of abuse and neglect of residents in a timely manner.” 

Recent reporting by CalMatters states that some nursing homes in the state have started filing a number of lawsuits against CDPH after the department issued various fines against facilities it found to have inadequate health standards. The facilities are filing these lawsuits to contest a slew of allegations against them, including the presence of maggots and sexual abuse of patients.

Tony Chicotel, Senior Staff Attorney for the California Advocates for Nursing Home Reform, called the legislation “the most important nursing home bill in decades” during his testimony to the committee.

“A growing number of nursing homes are run by squatters,” said Chicotel. “These are unreported, unvetted, and unlicensed operators … The system allows anyone to take over a nursing home, apply for a license whenever they feel like getting around to it, and provide care to thousands of vulnerable residents all while the state approval is pending, or even worse, after their application has been denied.”

Chicotel added that facilities run by “squatters” tend to provide care for more communities of color and low-income individuals, and have had some of the worst COVID-19 case rates in the state.

The California Association of Health Facilities (CAHF), which represents the majority of skilled nursing facilities in the state, is opposed to the bill unless it is amended. While they agree that the current licensing process is inadequate and needs to be changed, the association believes the onus should be on the state, not on nursing facilities. “Nursing facilities did not create this backwards process,” reads the organization’s opposition in the bill analysis.

CAHF argues that AB 1502’s strict disqualification provisions would deter most if not all applicants for ownership of skilled nursing facilities.