The Health and Human Services Commission (HHSC) proposes, on behalf of the Department of Aging and Disability Services (DADS), new Subchapter A, consisting of §§92.1 - 92.6, concerning purpose and application, definitions, types of assisted living facilities, license fees, health care professional, and general characteristics of residents; new Subchapter B, consisting of §§92.11 - 92.20, concerning criteria for licensing, general application requirements, time periods for processing all types of license applications, initial application procedures and requirements, renewal procedures and qualifications, change of ownership, relocation, increase in capacity, decrease in capacity, and provisional license; new §92.54, concerning advertisements, solicitations, and promotional material; and new Subchapter H, Division 9, consisting of §92.551, concerning administrative penalties; and proposes the repeal of Subchapter A, consisting of §§92.2 - 92.4, concerning basis and scope, chapter definitions, and types of assisted living facilities; Subchapter B, consisting of §§92.10 - 92.23, concerning licenses and licensing application procedures for assisted living facilities; Subchapter H, Division 9, consisting of §§92.551 - 92.595, concerning administrative penalties; and Subchapter H, Division 10, consisting of §§92.601 - 92.616, concerning enforcement, in Chapter 92, Licensing Standards for Assisted Living Facilities.

BACKGROUND AND PURPOSE

The purpose of the new sections and repeal is, in part, to implement some of the provisions of Senate Bill (SB) 1318, 80th Legislature, Regular Session, 2007, which amended the Texas Health and Safety Code, Chapter 247. The rules are being rewritten to update agency names, rules citations, and definitions; clarify criteria for licensing; reflect current application procedures; and reorganize the rules to place them in a more logical order.

SECTION-BY-SECTION SUMMARY

Proposed new §92.1 states the purpose of the chapter.

Proposed new §92.2 defines words and terms commonly used throughout the chapter.

Proposed new §92.3 provides the criteria used to classify licensure types for assisted living facilities (ALFs). The four types of licenses are Type A - C and Type E. An assisted living facility's license type is based on resident capability, facility services, or both.

Proposed new §92.4 establishes license fees based on the type of ALF and whether a one-year or two-year license is sought. The new section also sets the rates for a late renewal fee, trust fund fee, and plan review fee. New §92.4 also provides general information regarding how to pay the required fees.

Proposed new §92.5 allows a resident to contract with persons or agencies outside the facility for health care services, including services similar to those available in a nursing facility.

Proposed new §92.6 provides some of the characteristics of a resident in an ALF.

Proposed new §92.11 sets the criteria an ALF must meet in order to be licensed.

Proposed new §92.12 provides the basic requirements for application submission for licensure of an ALF.

Proposed new §92.13 provides the time periods for processing ALF license applications. The new section also provides that an applicant can request reimbursement of license fees paid with the submission of an application, when an application is not processed in the time period specified by DADS.

Proposed new §92.14 provides instructions regarding application procedures and requirements for an initial ALF license.

Proposed new §92.15 provides the procedures and qualifications an applicant must meet to renew an ALF license.

Proposed new §92.16 states that an ALF must notify DADS of a change of ownership before the anticipated effective date of the change. The new section allows DADS to assess an administrative penalty against a license holder who does not comply with the requirements of the section.

Proposed new §92.17 provides the requirements for relocation of an ALF's residents when a facility closes and residents have to be moved to a different location.

Proposed new §92.18 requires an ALF license holder to apply for, pay for, and obtain approval from DADS for an increase in a facility's licensed capacity.

Proposed new §92.19 states that an ALF license holder must notify DADS, in writing, of the desire to decrease the facility's licensed capacity.

Proposed new 92.20 details the circumstances under which DADS may issue a provisional license.

Proposed new §92.54 states that an ALF's state-issued facility identification number must be used in all marketing materials.

Proposed new §92.551 provides the violations for which DADS may assess an administrative penalty against an ALF license holder. The new section also provides the criteria DADS considers when deciding the amount of the administrative penalty. A new schedule of administrative penalties is included in the new section. The schedule lists the violations for which DADS may assess an administrative penalty with the corresponding fees. The new section allows for an opportunity to correct certain violations and avoid the assessment of an administrative penalty.

The repeal of §§92.2 - 92.4 deletes the existing rule sections, which are replaced by new Subchapter A. The repeal of §§92.10 - 92.23 deletes the existing rule sections, which are replaced by new Subchapter B. The repeal of §§92.551 - 92.595 and §§92.601 - 92.616 deletes Subchapter H, Divisions 9 and 10, which are replaced by new Subchapter H, Division 9.

FISCAL NOTE

Gordon Taylor, DADS Chief Financial Officer, has determined that, for the first five years the proposed new sections and repeal are in effect, there are no significant foreseeable implications relating to costs or revenues of state and local government.

SMALL BUSINESS AND MICRO-BUSINESS IMPACT ANALYSIS

DADS has determined that the proposed new sections and repeal may have an adverse economic effect on small businesses and micro-businesses because the businesses that do not comply with the rule are subject to a late fee in the amount equal to one-half of the basic application fee. Also, if a facility fails to notify DADS of a change of ownership before the effective date of the change, the facility may be charged an administrative penalty.

DADS estimates that the number of small businesses and micro-businesses subject to the proposed new sections and repeal is less than 1,242. This estimate is based on DADS records which indicate that of the 1,463 licensed ALFs, 1,242 are formed for the purpose of making a profit, one of the requirements for being a small or micro-business. The projected economic impact for a small business and micro-business is a possible late fee ranging from $25 to $750 and possible administrative penalty ranging from $100 to $1000.

Several alternatives were considered in determining how to accomplish the objectives of the proposed rules while minimizing the adverse economic effect on small businesses and micro-businesses. Statute gives DADS the option of assessing a late fee if an assisted living facility does not comply with the rules related to the submission of a renewal application. Therefore, DADS considered not imposing a late fee against a facility that does not comply with the proposed rule. DADS did not consider this option consistent with its responsibility as a regulatory agency and, specifically, determined that this option would not adequately address its needs to have a timely renewal application submitted. DADS may also assess an administrative penalty against a facility that fails to notify DADS of a change of ownership. DADS considered the previous option of not imposing a penalty against a facility for failure to notify DADS of a change of ownership before the effective date of the change. DADS did not consider this option consistent with its responsibility as a regulatory agency and, specifically, determined that this option would not adequately address its needs of receiving a timely notification before a change of ownership occurs. DADS considered the use of a maximum flat fee and penalty structure that did not take provider bed capacity into consideration but determined that this structure would disproportionately impact smaller providers.

PUBLIC BENEFIT AND COSTS

Veronda Durden, DADS Assistant Commissioner for Regulatory Services, has determined that, for each year of the first five years the new sections and repeal are in effect, the public benefit expected as a result of enforcing the new sections and repeal is that DADS rules will comply with statutory law. The public will also benefit from the rules being easier to read and follow.

Ms. Durden anticipates that there may be an economic cost to persons who are required to comply with the new sections and repeal, because a late fee or administrative penalty may be assessed for noncompliance. The new sections and repeal will not affect a local economy.

TAKINGS IMPACT ASSESSMENT

DADS has determined that this proposal does not restrict or limit an owner's right to his or her property that would otherwise exist in the absence of government action and, therefore, does not constitute a taking under Texas Government Code, §2007.043.

PUBLIC COMMENT

Questions about the content of this proposal may be directed to Hannah Ndika at (512) 438-2133 in DADS' Regulatory Services Division. Written comments on the proposal may be submitted to Texas Register Liaison, Legal Services-015, Department of Aging and Disability Services W-615, P.O. Box 149030, Austin, Texas 78714-9030, or street address 701 West 51st St., Austin, TX 78751; faxed to (512) 438-5759; or e-mailed to rulescomments@dads.state.tx.us. To be considered, comments must be submitted no later than 30 days after the date of this issue of the Texas Register. The last day to submit comments falls on a Sunday; therefore, comments must be either (1) postmarked or shipped before the last day of the comment period; (2) hand-delivered to DADS before 5:00 p.m. on DADS' last working day of the comment period; or (3) faxed or e-mailed by midnight on the last day of the comment period. When faxing or e-mailing comments, please indicate "Comments on Proposed Rule 015" in the subject line.

STATUTORY AUTHORITY

The new sections are proposed under Texas Government Code, §531.0055, which provides that the HHSC executive commissioner shall adopt rules for the operation and provision of services by the health and human services agencies, including DADS; Texas Human Resources Code, §161.021, which provides that the Aging and Disability Services Council shall study and make recommendations to the HHSC executive commissioner and the DADS commissioner regarding rules governing the delivery of services to persons who are served or regulated by DADS; and Texas Health and Safety Code, Chapter 247, which authorizes DADS to license and regulate assisted living facilities.

The new sections implement Texas Government Code, §531.0055; Texas Human Resources Code, §161.021; and Texas Health and Safety Code, §§247.001 - 247.069.