SF 532 (LSB 1473XS (4) 91)

SENATE FILE 532

BY  CELSI

A BILL FOR

An Act relating to health care facilities, providing penalties, making an appropriation, and including effective date and retroactive applicability provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 135C.14, subsection 5, Code 2025, is amended to read as follows:
   5.  Equipment essential to the health and welfare of the resident.  The rules shall require a health care facility that accepts state funding to annually adopt and provide to the department the health care facility’s policies regarding competitive procurement for supplies and equipment including transactions and associated reimbursement structures with any related party as defined in section 135C.7A.
    Sec. 2.  Section 135C.14, subsection 8, Code 2025, is amended by adding the following new paragraph:
   NEW PARAGRAPH.  g.  Facility policies and procedures regarding the use of arbitration agreements. The rules and standards shall prohibit any health care facility that accepts state funding from offering a resident, or requiring a resident to sign, an arbitration agreement that limits the resident’s inalienable right to seek full judicial review of a dispute as a precondition for being admitted to the facility.
    Sec. 3.  Section 135C.16, subsection 1, Code 2025, is amended to read as follows:
   1.  In addition to the inspections required by sections 135C.9 and 135C.38, the department shall make or cause to be made such further unannounced inspections as it deems necessary to adequately enforce this chapter. At On average, at least one general unannounced inspection shall be conducted for each health care facility within a thirty-month twelve-month period, not to exceed a period of fifteen months. The inspector shall show identification to the person in charge of the facility and state that an inspection is to be made before beginning the inspection. An employee of the department who gives unauthorized advance notice of an inspection made or planned to be made under this subsection or section 135C.38 shall be disciplined as determined by the director, except that if the employee is employed pursuant to the merit system provisions of chapter 8A, subchapter IV, the discipline shall not exceed the discipline authorized pursuant to that subchapter.
    Sec. 4.  Section 135C.36, subsection 1, Code 2025, is amended to read as follows:
   1.  A class I violation is one which presents an imminent danger or a substantial probability of resultant death or physical harm to the residents of the facility in which the violation occurs. A physical condition or one or more practices in a facility may constitute a class I violation. A class I violation shall be abated or eliminated immediately unless the department determines that a stated period of time, specified in the citation issued under section 135C.40, is required to correct the violation. A licensee is subject to a penalty of not less than two five thousand nor more than ten thousand dollars for each class I violation for which the licensee’s facility is cited.
    Sec. 5.  Section 135C.36, Code 2025, is amended by adding the following new subsection:
   NEW SUBSECTION.  1A.  A class I violation includes any confirmed instance of a facility retaliating against a resident or employee for filing a complaint or otherwise cooperating with the department or the office of long-term care ombudsman.
    Sec. 6.  Section 135C.38, subsection 1, paragraph a, Code 2025, is amended to read as follows:
   a.  Upon receipt of a complaint made in accordance with section 135C.37, the department shall make a preliminary review of the complaint. Unless the department concludes that the complaint is intended to harass a facility or a licensee or is without reasonable basis, the department shall make or cause to be made an on-site inspection of the health care facility which is the subject of the complaint within the time period determined pursuant to the following guidelines, which period shall commence on the date of receipt of the complaint:
   (1)  For nursing facilities, an on-site inspection shall be initiated as follows:
   (a)  Within two one working days day for a complaint determined by the department to be an alleged immediate jeopardy situation.
   (b)  Within ten five working days for a complaint determined by the department to be an alleged high-level, nonimmediate jeopardy situation.
   (c)  Within forty-five calendar days for a complaint determined by the department to be an alleged nonimmediate jeopardy situation, other than a high-level situation.
   (2)  For all other types of health care facilities, an on-site inspection shall be initiated as follows:
   (a)  Within two one working days day for a complaint determined by the department to be an alleged immediate jeopardy situation.
   (b)  Within twenty five working days for a complaint determined by the department to be an alleged high-level, nonimmediate jeopardy situation.
   (c)  Within forty-five calendar days for a complaint determined by the department to be an alleged nonimmediate jeopardy situation, other than a high-level situation.
    Sec. 7.  Section 135C.44, Code 2025, is amended to read as follows:
   135C.44  Treble Additional fines for repeated violations.
   The penalties authorized by section 135C.36 shall be trebled quadrupled for a second or subsequent class I or violation and tripled for a second or subsequent class II violation occurring within any twelve-month period if a citation was issued for the same class I or class II violation occurring within that period and a penalty was assessed therefor for the violation.
    Sec. 8.  NEW SECTION.  135C.49  Improper influence.
   1.  A member of the general assembly or an employee of the legislative or executive branch shall not attempt to influence a decision of the department during the course of an investigation, inspection, or appeal under this chapter.
   2.  An allegation of a violation of this section shall be investigated by the office of ombudsman established under section 2C.2. If the office of ombudsman determines a violation of this section has occurred, the office shall report the recommendations, including disciplinary action, pursuant to sections 2C.16 and 2C.19.
   3.  A person who is recommended for disciplinary action for a violation of this section is subject to a civil penalty of up to five thousand dollars per violation. A civil penalty collected pursuant to this section shall be credited to the department, shall be considered appropriated receipts as defined in section 8.2, and shall be used by the department to enforce this chapter.
   4.  a.  A civil penalty for violations committed by an employee of the executive branch shall be assessed by the department.
   b.  A civil penalty for violations committed by a member or employee of the general assembly shall be assessed pursuant to a resolution approved by a majority of the house in which the member serves or by which the employee is employed. If the general assembly is not in session at the time a recommendation is received from the office of ombudsman, a civil penalty shall be assessed by a majority vote of the legislative council.
    Sec. 9.  2023 Iowa Acts, chapter 108, section 7, subsection 4, is amended to read as follows:
   4.  HEALTH FACILITIES
   a.  For salaries, support, maintenance, and miscellaneous purposes, and for not more than the following full-time equivalent positions:
   ...................................................................... $  4,862,971

                                                                          5,462,971
   ............................................................... FTEs        115.00

                                                                               145.00

   b.  The department shall make all of the following information available to the public as part of the department’s development efforts to revise the department’s internet site:
   (1)  The number of inspections of health facilities conducted by the department annually by type of service provider and type of inspection.
   (2)  The total annual operations budget for the department that is associated with health facilities regulation, including general fund appropriations and federal contract dollars received by type of service provider inspected.
   (3)  The total number of full-time equivalent positions in the department that are associated with health facilities regulation, to include the number of full-time equivalent positions serving in a supervisory capacity, and serving as surveyors, inspectors, or monitors in the field by type of service provider inspected.
   (4)  Identification of state and federal survey trends, cited regulations, the scope and severity of deficiencies identified, and federal and state fines assessed and collected concerning nursing and assisted living facilities and programs.
   c.  It is the intent of the general assembly that the department continuously solicit input from health facilities regulated by the department to assess and improve the department’s level of collaboration and to identify new opportunities for cooperation.
   d.  Of the funds appropriated in this subsection, $600,000, in addition to federal matching funds, shall be used to employ additional nursing facility inspectors and assisted living program monitors to perform additional safety inspections.
    Sec. 10.  EFFECTIVE DATE.  The following, being deemed of immediate importance, takes effect upon enactment:
   The section of this Act amending 2023 Iowa Acts, chapter 108, section 7, subsection 4.
    Sec. 11.  RETROACTIVE APPLICABILITY.  The following applies retroactively to July 1, 2023:
   The section of this Act amending 2023 Iowa Acts, chapter 108, section 7, subsection 4.
EXPLANATION
The inclusion of this explanation does not constitute agreement with

the explanation’s substance by the members of the general assembly.
   This bill relates to health care facilities and the department of inspections, appeals, and licensing (DIAL).
   The bill requires that the administrative rules and standards to be adopted and enforced by DIAL as part of the rule relating to equipment essential to the health and welfare of the resident, require a facility that receives state funding annually adopt and provide to the department the facility’s policies regarding competitive procurement for supplies and equipment. Additionally, the rules and standards shall include policies and procedures regarding the use of arbitration agreements. Specifically, the rules shall prohibit any facility that accepts state funding from offering a resident, or requiring a resident to sign, an arbitration agreement that limits the resident’s inalienable right to seek full judicial review of a dispute as a precondition for being admitted to the facility.
   The bill requires that, on average, DIAL perform at least one general unannounced inspection of a health care facility within a 12-month period not to exceed a period of 15 months, rather than the current 30-month period.
   The bill increases the monetary amount for the bottom of the range of the penalty for a class I violation by a health care facility from $2,000 to $5,000, and maintains the upper part of the range at $10,000. The bill also increases the penalty for repeated class I violations in a 12-month period for which a penalty is assessed by quadrupling rather than tripling the amount.
   The bill adds as a class I violation for a health care facility any confirmed instance of a facility retaliating against a resident or employee for filing a complaint or otherwise cooperating with the department or the office of long-term care ombudsman.
   The bill amends the required time period within which DIAL must respond upon receipt of a complaint. Under the bill, for nursing facilities, an on-site inspection shall be initiated within one working day rather than the current two working days if a complaint is determined to be an alleged immediate jeopardy situation; and within five rather than the current 10 working days if a complaint is determined to be an alleged high-level, nonimmediate jeopardy situation. Under the bill for all other types of health care facilities, an on-site inspection shall be initiated within one working day rather than two working days if a complaint is determined to be an alleged immediate jeopardy situation; and within five working days rather than 20 working days if a complaint is determined be an alleged high-level, nonimmediate jeopardy situation.
   The bill provides that a member of the general assembly or an employee of the legislative or executive branch shall not attempt to influence a decision of DIAL during the course of an investigation, inspection, or appeal. An allegation of a violation shall be investigated by the office of ombudsman. If the office of ombudsman determines a violation has occurred, the office shall report the recommendations, including disciplinary action, to an agency. A person who is recommended for disciplinary action for a violation is subject to a civil penalty of up to $5,000 per violation. A civil penalty collected shall be credited to DIAL, considered appropriated receipts, and used by DIAL to enforce Code chapter 135C. DIAL shall assess the civil penalty for violations committed by an employee of the executive branch, and a civil penalty for violations committed by a member or employee of the general assembly shall be assessed pursuant to a resolution or by the legislative council if the general assembly is not in session at the time a recommendation is received from the office of ombudsman.
   The bill amends the appropriation for FY 2023-2024 to DIAL for health facilities to provide for an increase of $600,000 and 30.00 additional full-time equivalent positions. The appropriated funds, in addition to the federal matching funds, shall be used for additional nursing facility inspectors and assisted living program monitors to perform additional safety inspections. This provision takes effect upon enactment and is retroactively applicable to July 1, 2023.