103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB2843

 

Introduced 2/16/2023, by Rep. Suzanne M. Ness

 

SYNOPSIS AS INTRODUCED:
 
210 ILCS 45/3-305.10 new

    Amends the Nursing Home Care Act. Provides that a for-profit facility licensed under the Act shall disclose data regarding the lease or rental of the facility by a real estate partnership owning the facility to a business operating the facility in any cost report submitted by the facility to the State. Provides that the provisions only apply to a facility that is leased or rented by its owner to a related party of the owner. Contains specified data to be disclosed by a for-profit facility under the Act with each cost report filed with the Department of Healthcare and Family Services. Requires the information disclosed to be filed with the Department's Bureau of Health Finance within 90 days after the end of each fiscal year. Requires the Department to publish the information on its website for general viewing and in an annual report to the General Assembly. Requires the Auditor General to submit an annual audit report to the General Assembly concerning the quality of care, financial practices, and statewide oversight of Illinois' facilities. Provides that any individual who has an ownership interest in a facility that is placed on the federal Special Focus Facility List published by the Centers for Medicare and Medicaid Services or its list of candidates for that List shall not obtain an ownership interest in another facility in the State until the facility has been removed from and remains off of the Special Focus Facility List or the list of candidates for that List for a period of 2 years. Provides that, within 90 days after the effective date of the amendatory Act, all long-term care providers operating or maintaining a facility shall notify the Department of all individual owners and any individuals or organizations that are part of a limited liability company with ownership of that facility and the percentage of ownership of each owner. Provides that this ownership reporting requirement does not include individual shareholders in a publicly held corporation. Requires the Department, in collaboration with any other relevant State agency, to work to improve State data collection forms for facilities to ensure that all relevant information is provided. Provides that State regulators shall perform specified duties.


LRB103 30098 CPF 56522 b

 

 

A BILL FOR

 

HB2843LRB103 30098 CPF 56522 b

1    AN ACT concerning regulation.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Nursing Home Care Act is amended by adding
5Section 3-305.10 as follows:
 
6    (210 ILCS 45/3-305.10 new)
7    Sec. 3-305.10. Rental data disclosure; facility cost
8report; ownership interests.
9    (a) In this Section:
10    "Department" means the Department of Healthcare and Family
11Services.
12    "Real estate partnership" means any combination of
13domestic or foreign corporations, limited liability companies,
14limited liability partnerships, subsidiaries, management
15companies, general partnerships, sole proprietorships, limited
16liability partnerships, or any other legal entities recognized
17under Illinois law that hold real estate together.
18    "Related business entity" means one of 2 or more entities
19where:
20        (1) the entities have (i) significant common purposes
21    and substantial common membership or (ii) direct or
22    indirect, substantial, and common direction or control;
23        (2) either entity owns, directly or through one or

 

 

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1    more entities, a 50% or greater interest in the capital or
2    profits of the other;
3        (3) the entities share a real estate partnership; or
4        (4) the owner or operator of either entity has a
5    familial relationship or is a related party to a person
6    who is an owner or operator of the other entity.
7    "Related party" includes a person's parent, stepparent,
8child, spouse, sibling, cousin, or other family member.
9    (b) A for-profit facility licensed under this Act shall
10disclose, with each cost report filed with the Department,
11data regarding the lease or rental of the facility by a related
12business entity that owns the facility to a business operating
13the facility that is submitted as a cost report by the facility
14to the State. The data shall include the following:
15        (1) Any new company created by an investor or a
16    related party of an investor in the facility to hold a real
17    estate asset of the facility, including the value of any
18    building on the real estate, the value of the real
19    property itself, and the value of the company itself.
20        (2) Information regarding the rental or provision of
21    ventilators, pharmaceutical supplies, ambulances,
22    management and professional services, or payroll services
23    to any facility that is leased or rented by the facility's
24    property owner, business owner, or a related party of the
25    property owner or business owner. This information
26    includes, but is not limited to, the following:

 

 

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1            (A) General services, such as dietary,
2        housekeeping, laundry, maintenance, nonemergency
3        transport, or food services.
4            (B) Health care and program services, such as the
5        facility's medical director, nursing and medical
6        records, therapy, activities, certified nursing
7        assistant training, program transportation, and
8        special services.
9            (C) General administration services, such as
10        professional services, payroll services, clerical and
11        general office services, data processing, in-service
12        training and education, staff and resident
13        transportation, consulting services, project manager
14        services, and associated services.
15            (D) Capital expenses and services, such as
16        facility rent, leases, grounds, equipment, supplies,
17        and vehicles.
18            (E) Ancillary expenses.
19            (F) Contractual services, such as:
20                (i) lobbying services;
21                (ii) association dues; and
22                (iii) campaign contributions.
23        (3) Detailed information on any declaration of
24    bankruptcy, as well as any sale of any privately or
25    publicly held real estate to a real estate investor,
26    investment trust, or private equity firm. This information

 

 

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1    includes, but is not limited to, the following:
2            (A) Any required filings by a board of trustees
3        under any other law and disclosure of the names of the
4        president, leadership board, and members of the
5        corporation, limited liability company, limited
6        liability partnership, subsidiary, management company,
7        general partnership, sole proprietorship, limited
8        liability partnership, or other legal entity
9        recognized under any State or federal law or rule.
10            (B) Documentation that includes, but is not
11        limited to, annual filings with the Secretary of State
12        and any relevant federal filings.
13            (C) Identification of entities that have either a
14        significant ownership interest, meaning at or greater
15        than 0.01%, in the facility or that play an important
16        role in the facility's management, financing, or
17        operation.
18        (4) Details of any private equity backing of the
19    facility.
20        (5) Information on the interest rates and other terms
21    of loans and credit provided by related business entities.
22        (6) All income and expenses related to the business
23    entity in question, from gross and net revenues to gross
24    and net expenses, including, but not limited to, any
25    expenses paid to management companies regarding the real
26    property.

 

 

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1        (7) In a form that protects the privacy rights of
2    residents, the facility's spending relating to Medicaid
3    and Medicare and the amounts of State and federal funds
4    received or spent by the facility.
5    (c) The disclosure required under subsection (b) shall be
6filed with the Department's Bureau of Health Finance within 90
7days after the end of each fiscal year. The Department shall
8publish the information collected on the Department's website
9for general viewing and in an annual report to the General
10Assembly. The report to the General Assembly shall also
11include recommendations based on annual findings.
12    (d) Any individual who has an ownership interest in a
13facility that is placed on the federal Special Focus Facility
14List published by the Centers for Medicare and Medicaid
15Services or its list of candidates for that List shall not
16obtain an ownership interest in another facility in the State
17until the facility has been removed from and remains off of the
18Special Focus Facility List or the list of candidates for that
19List for a period of 2 years.
20    (e) Within 90 days after the effective date of this
21amendatory Act of the 103rd General Assembly, all long-term
22care providers operating or maintaining a facility shall
23notify the Department of all individual owners and any
24individuals or organizations who are part of a limited
25liability company with ownership of that facility and the
26percentage of ownership of each owner. This ownership

 

 

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1reporting requirement does not include individual shareholders
2in a publicly held corporation. In this subsection, "long-term
3care provider" has the same meaning as defined in Section 5B-1
4of Article V-B of the Illinois Public Aid Code.
5    (f) The Department, in collaboration with any other
6relevant State agency, shall work to improve State data
7collection forms for facilities to ensure that all relevant
8information is provided.
9    (g) Notwithstanding any other provision of law to the
10contrary, State regulators shall determine whether facilities
11are paying fair market prices for services and goods provided
12by related business entities, compel facility chief executive
13officers to personally sign annual disclosure reports pledging
14that such goods and services were purchased from related
15parties at fair market rates, or both.