Discharge Compliance Penalties Skyrocket for California SNFs

California’s skilled nursing facilities will face surging fines if they don’t comply with transfer discharge hearing decisions, thanks to a bill passed last week by Gov. Gavin Newsom (D).

Assembly Bill 133 increases fines from $50 to $750 per day if facilities “improperly transferred, discharged or refused to readmit a resident.” That’s a 1400% increase.

Once collected the funds will be kept in the state’s general fund and used to “improve the quality of long-term care services under the Medi-Cal program,” the bill states.


State organizations representing nursing homes like the California Association of Health Facilities (CAHF) say this is a duplicate policy, as the California Department of Public Health and Centers for Medicare & Medicaid Services (CMS) already fine facilities for being out of compliance in this way.

Deborah Pacyna, director of public affairs at CAHF, added that the organization had no opportunity to improve the current hearing process for transfer discharge noncompliance — a major flaw in the process allows administrative law judges to make a formal decision on a case rather than hearing officers.

“The Governor’s signature on AB 133 represents a major policy change for California providers. We believe the proposal should have received a public hearing in a policy committee instead of moving through the budget process,” Pacyna said in an email to Skilled Nursing News. “This proposal denies due process to skilled nursing facilities whose reason for discharging residents are often related to concerns regarding the safety of residents and staff.”


CAHF represents 80% of skilled nursing facilities in the state.

“While LeadingAge California understands the goal, AB 133 does not consider other ways the state can address discharges including the administrative process at the Department of Health Care Services,” the state chapter of senior advocacy group LeadingAge said in an email to SNN.

Operators looking to appeal assessed penalties would need to go to the superior court of the county where a particular facility is located; otherwise, facilities would submit a certificate of compliance online.

The state Department of Health Care Services withdraws the penalty from a facility’s Medi-Cal payments — in the case of a merger, acquisition or change of ownership, the successor would need to pay any of these outstanding fines.

A new operator would have the opportunity to petition for a waiver if the facility can prove it has taken action to remedy improper transfer discharges.

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