HF 2391 (LSB 5265HV (3) 90)

HOUSE FILE 2391

BY  COMMITTEE ON HEALTH AND HUMAN SERVICES

(SUCCESSOR TO HF 2199)

A BILL FOR

An Act relating to health care employment agencies, including the statewide maximum allowable charges schedule applicable to nursing services provided by health care employment agency workers, providing penalties, and including effective date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 135Q.1, Code 2024, is amended to read as follows:
   135Q.1  Definitions.
   As used in this chapter, unless the context otherwise requires:
   1.  “Department” means the department of inspections, appeals, and licensing.
   2.  “Health care employment agency” or “agency” means an any of the following:
   a.  An agency that contracts with a health care entity in this state to provide agency workers for temporary or temporary-to-hire employee placements.
   b.  A health care technology platform.
   3.  “Health care employment agency worker” or “agency worker” means an individual who contracts with or is employed by a health care employment agency to provide nursing services to health care entity consumers.
   4.  “Health care entity” means a facility, agency, or program licensed or certified by the department or by the centers for Medicare and Medicaid services of the United States department of health and human services. 
   5.  “Health care technology platform” or “platform” includes an individual, a trust, a partnership, a corporation, a limited liability partnership or company, or any other business entity that develops and operates, offers, or maintains a system or technology that provides an internet-based or application-based marketplace through which an individual as an independent contractor, and in the individual’s sole discretion, chooses when and how often to utilize the platform to bid on or select open shifts posted by a health care entity to provide nursing services to a health care entity.
   6.  “Individual agency worker category” includes registered nurses, licensed practical nurses, certified nurse aides, certified medication aides, home health aides, medication managers, and noncertified or nonlicensed staff providing personal care as defined in section 231C.2 who are health care employment agency workers.
   5.  7.  “Managing entity” means a business entity, owner, ownership group, chief executive officer, program administrator, director, or other decision maker whose responsibilities include directing the management or policies of a health care employment agency. “Managing entity” includes an individual who, directly or indirectly, holds a beneficial interest in a corporation, partnership, or other business entity that constitutes a managing entity.
   6.  8.  “Nursing services” means those services which may be provided only by or under the supervision of a nurse. “Nursing services” includes services performed by a registered nurse, a licensed practical nurse, a certified nurse aide, a certified medication aide, a home health aide, a medication manager, or by noncertified or nonlicensed staff providing personal care as defined in section 231C.2.  “Nursing services” does not include the practice of nursing by an advanced registered nurse practitioner or an advanced practice registered nurse licensed under chapter 152 or 152E.
   9.  “Nursing services professionals” includes registered nurses, licensed practical nurses, certified nurse aides, certified medication aides, home health aides, medication managers, and noncertified or nonlicensed staff providing personal care as defined in section 231C.2 who are not health care employment agency workers but instead are employed directly by or contract directly with a health care entity.
    Sec. 2.  Section 135Q.2, Code 2024, is amended to read as follows:
   135Q.2  Health care employment agency requirements —— registration —— liability —— penalties.
   1.  a.  A health care employment agency operating in the state shall register annually with the department. Each separate location of a health care employment agency shall register annually with and pay an annual registration fee of five hundred dollars to the department. The department shall issue each location a separate certification of registration upon approval of registration and payment of the fee. The annual registration fees shall be retained by the department as repayment receipts as defined in section 8.2.
   b.  A health care employment agency that fails to register with the department as required under this section is prohibited from contracting with a health care entity in this state.
   2.  A health care employment agency shall do all of the following:
   a.  Ensure that agency workers comply with all applicable requirements relating to the health requirements and qualifications of personnel in health care entity settings.
   b.  Document that each agency worker meets the minimum licensing, certification, training, and health requirements and the continuing education standards for the agency worker’s position in the health care entity setting.
   c.  Maintain records for each agency worker and report, file, or otherwise provide any required documentation to external parties or regulators which would otherwise be the responsibility of the health care entity if the agency worker was employed by the health care entity.
   d.  Maintain professional and general liability insurance coverage with minimum per occurrence coverage of one million dollars and aggregate coverage of three million dollars to insure against loss, damage, or expense incident to a claim arising out of the death or injury of any person as the result of negligence or malpractice in the provision of services by the agency or an agency worker.
   3.  a.  A health care employment agency shall not do any of the following:
   (1)  Restrict in any manner the employment opportunities of an agency worker by including a non-compete clause in any contract with an agency worker or health care entity.
   (2)  In any contract with an agency worker or health care entity, require payment of liquidated damages, employment fees, or other compensation if the agency worker is subsequently hired as a permanent employee of the health care entity.
   (3)  Use the establishment of, or the required applicability of, the statewide maximum allowable charges schedule as a basis for prohibiting or otherwise interfering with a wage increase for any agency worker.
   b.  This subsection shall not apply to a contract between a health care employment agency and an agency worker or a health care entity if the contract meets all of the following criteria:
   (1)  The contract is entered into for the purpose of placing an agency worker the health care employment agency assisted in obtaining authorization to work in the United States.
   (2)  The contract contains an initial duration term of not less than twenty-four months and a total duration term, including any renewals or extensions, of not more than thirty-six months.
   (3)  The contract requires the agency worker to work for a single health care entity for the entire duration of the contract.
   c.  Any contract that violates this subsection shall be unenforceable in court.
   4.  A health care employment agency shall submit a report to the department on a quarterly basis for each health care entity participating in Medicare or Medicaid with whom the agency contracts that includes all of the following by provider type:
   a.  A detailed list of the average amount charged to the health care entity for each individual agency worker category.
   b.  A detailed list of the average amount paid by the agency to agency workers in each individual agency worker category.
   5.  a.  A health care employment agency that violates subsection 1 or subsection 2 is subject to denial or revocation of registration for a period of one year and a monetary penalty of five hundred dollars for a first offense and five thousand dollars for each offense thereafter.
   b.  A health care employment agency that violates subsection 3 or that knowingly provides an agency worker who has an illegally or fraudulently obtained or issued diploma, registration, license, certification, or background check to a health care entity is subject to immediate revocation of registration. The department shall notify the agency thirty days in advance of the date of such revocation.
   c.  (1)  The managing entity of an agency for which registration has been denied or revoked under this subsection shall not be eligible to apply for or be granted registration for another agency during the two-year period following the date of the denial or revocation.
   (2)  The department shall not approve a new registration or renew an existing registration for any agency for which the managing entity is also the managing entity of an agency for which registration has been denied or revoked during the two-year period in which registration of the violating agency is denied or revoked.
   6.  5.  The department shall establish a system for members of the public to report complaints against an agency or agency worker. The department shall investigate any complaint received and shall report the department’s findings to the complaining party and the agency involved.
    Sec. 3.  NEW SECTION.  135Q.3  Statewide maximum allowable charges schedule —— establishment and annual revision —— required utilization and compliance —— rules.
   1.  The department of health and human services shall annually establish and publish by September 30, a statewide maximum allowable charges schedule that shall be applicable January 1 of the immediately following calendar year to nursing services provided by a health care employment agency worker. The department of health and human services shall utilize the most recently preceding nursing facility cost report schedule H to calculate the statewide maximum allowable charges. The department of health and human services, in collaboration with stakeholders, shall develop a process to periodically obtain wage information from provider types other than nursing facilities.
   2.  The amounts established in the statewide maximum allowable charges schedule shall meet all of the following requirements:
   a.  The amounts shall be no greater than one hundred fifty percent of the statewide average wage paid in the most recently preceding cost report year by a specific type of health care entity to a nursing services professional, within a specific nursing services professional category, and within the applicable core-based statistical area of the state.
   b.  The amounts shall be inclusive of the hourly rate, administrative fees, contract fees, transportation or travel stipends, per diems, and any other costs a health care employment agency is authorized to include in the charge to a health care entity for nursing services provided by an agency worker within an individual agency worker category.
   3.  Each separate location of a health care employment agency registered under section 135Q.2 shall utilize and comply with the statewide maximum allowable charges schedule established under this section.
   4.  The department of health and human services, in cooperation with the department, shall adopt rules pursuant to chapter 17A to administer this section.
    Sec. 4.  NEW SECTION.  135Q.4  Penalties —— enforcement.
   1.  a.  A health care employment agency that violates section 135Q.2, subsection 1 or 4, is subject to an initial monetary penalty of five thousand dollars and shall be provided notification and given a thirty-day grace period in which to comply.
   b.  A health care employment agency that fails to comply following the notification and within the thirty-day grace period under paragraph “a”, shall be subject to a monetary penalty of twenty-five thousand dollars. 
   c.  If a health care employment agency fails to comply with paragraph “b”, the health care employment agency shall be subject to an additional monetary penalty of twenty-five thousand dollars, revocation of registration, and denial of subsequent registration for up to three years.
   2.  a.  A health care employment agency that violates section 135Q.2, subsection 2, or that knowingly provides an agency worker who has an illegally or fraudulently obtained or issued diploma, registration, license, certification, or background check to a health care entity is subject to a monetary penalty of five thousand dollars for each violation.
   b.  If a health care employment agency commits a second or subsequent violation of section 135Q.2, subsection 2, within any three-year period, the health care employment agency shall be subject to immediate revocation of registration. The department shall notify the agency thirty days in advance of the date of such revocation.
   3.  A health care employment agency that violates section 135Q.2, subsection 3, is subject to a monetary penalty of twenty-five thousand dollars for the first violation. If a health care employment agency violates section 135Q.2, subsection 3, a second or subsequent time, the health care employment agency shall be subject to immediate revocation of registration, and shall not be eligible to apply for or be granted registration for the three-year period immediately following the date of revocation. 
   4.  A health care employment agency that violates section 135Q.3 shall be subject to a monetary penalty of five thousand dollars for the first violation, and a monetary penalty of twenty-five thousand dollars for each subsequent violation.
   5.  a.  The managing entity of an agency for which registration has been denied or revoked under this section shall not be eligible to apply for or be granted registration for another agency during the three-year period following the date of the denial or revocation.
   b.  The department shall not approve a new registration or renew an existing registration for any agency for which the managing entity is also the managing entity of an agency for which registration has been denied or revoked during the three-year period in which registration of the violating agency is denied or revoked.
   6.  Any monetary penalties collected under this section shall be retained by the department as repayment receipts as defined in section 8.2. 
   7.  The attorney general shall enforce the provisions of this chapter.
    Sec. 5.  NEW SECTION.  135Q.5  Department annual report.
   The department shall submit an annual report to the general assembly by January 15, for the immediately preceding fiscal year, that includes a summary of the number of registrations issued and the amount of registration fees collected, the violations of this chapter, the amount of monetary penalties collected, the number of health care employment agencies and managing entities for whom a registration was revoked or denied, the statewide maximum allowable charges schedule, and any recommendations for changes to the chapter. 
    Sec. 6.  EFFECTIVE DATE.  This Act, being deemed of immediate importance, takes effect upon enactment.
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 employment agencies (agency), including the maximum allowable charges an agency may charge a health care entity for nursing services provided by a health care employment agency worker (agency worker).
   The bill defines terms used in the bill, including “health care employment agency” which includes a “health care technology platform” as defined in the bill; “individual agency worker category” which includes specified health professionals who are agency workers, and “nursing services professionals” which includes the same specified health professionals who are not agency workers but are instead employed directly by, or contract directly with, a health care entity.
   The bill requires the department of health and human services (HHS) to annually establish and publish by September 30, a statewide maximum allowable charges schedule (charges schedule) applicable January 1 of the following calendar year to nursing services provided by agency workers. The amounts established in the charges schedule must be no greater than 150 percent of the statewide average wage paid in the most recently preceding cost report year by a specific type of health care entity to a nursing services professional, within a specific nursing services professional category, and within the applicable core-based statistical area of the state; and must be inclusive of the hourly rate, administrative fees, contract fees, transportation or travel stipends, per diems, and any other costs an agency is authorized to include in the charge to a health care entity for nursing services provided by an agency worker within an individual agency worker category. The bill requires each separate location of an agency registered in the state to utilize and comply with the charges schedule established under the bill. The bill directs HHS in cooperation with the department of inspections, appeals, and licensing (DIAL) to adopt administrative rules to administer these provisions of the bill. The bill prohibits an agency from using the establishment of, or the required applicability of, the charges schedule as a basis for prohibiting or otherwise interfering with a wage increase for any agency worker. 
   The bill amends current penalties under Code chapter 135Q and includes new penalties for violations of provisions included in the bill.
   The bill provides that an agency that violates Code section 135Q.2(1) (relating to required registration and the prohibition against contracting with a health care entity in the state if the agency is not registered), or Code section 135Q.2(4) (relating to submitting quarterly reports to DIAL), is subject to an initial monetary penalty of $5,000 and shall be provided notification and given a 30-day grace period in which to comply. If the agency fails to comply following the notification and within the 30-day grace period, the agency shall be subject to a monetary penalty of $25,000. If the agency continues the noncompliance, the agency shall be subject to an additional monetary penalty of $25,000, revocation of registration, and denial of subsequent registration for up to three years. The bill also provides that an agency that violates Code section 135Q.2(2) (relating to certain prohibited restrictions on agency workers or health care entities and contracting prohibitions), or that knowingly provides an agency worker who has an illegally or fraudulently obtained or issued diploma, registration, license, certification, or background check to a health care entity is subject to a monetary penalty of $5,000 for each violation, and to immediate revocation of registration. If the agency commits a second or subsequent violation within any three-year period, the health care employment agency shall be subject to immediate revocation of registration. Under the bill, an agency that violates Code section 135Q.2(3) (relating to contracting with agency workers and health care entities) is subject to a monetary penalty of $25,000 for a first offense, and to immediate revocation of registration and denial of registration for the three-year period following revocation for a second or subsequent violation.
   An agency that violates Code section 135Q.3 (relating to requirements regarding the statewide allowable charges schedule), shall be subject to a monetary penalty of $5,000 for the first violation and a monetary penalty of $25,000 for each subsequent violation. 
   The bill also provides that the managing entity of an agency for which registration has been denied or revoked shall not be eligible to apply for or be granted registration for another agency during the three-year period following the date of the denial or revocation; and DIAL shall not approve a new registration or renew an existing registration for any agency for which the managing entity is also the managing entity of an agency for which registration has been denied or revoked during the three-year period in which registration of the violating agency is denied or revoked. The bill provides that any monetary penalties collected shall be retained by DIAL as repayment receipts as defined in Code section 8.2. The bill provides that the attorney general shall enforce the provisions of the bill.
   The bill requires DIAL to submit an annual report to the general assembly by January 15, for the immediately preceding fiscal year, that includes a summary of the number of registrations issued and the amount of registration fees collected, the violations of the chapter, the amount of monetary penalties collected, the number of health care employment agencies and managing entities for whom a registration was revoked or denied, the charges schedule, and any recommendations for changes to the Code chapter. The bill takes effect upon enactment.