S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   2738
 
                        2023-2024 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             January 27, 2023
                                ___________
 
 Introduced  by  M. of A. PEOPLES-STOKES -- read once and referred to the
   Committee on Health
 
 AN ACT to amend the public health law,  in  relation  to  directing  the
   commissioner of health to establish demonstration projects authorizing
   equity  investment in the operation of residential health care facili-
   ties

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Section  2801-a  of  the  public health law is amended by
 adding a new subdivision 17 to read as follows:
   17. (A) THE COMMISSIONER SHALL, ON OR  BEFORE  DECEMBER  THIRTY-FIRST,
 TWO THOUSAND TWENTY-THREE, ESTABLISH UP TO TWO DEMONSTRATION PROJECTS TO
 DEVELOP,  EVALUATE  AND  IMPLEMENT AN INNOVATIVE APPROACH TO ENCOURAGING
 EQUITY INVESTORS TO PROVIDE NEEDED FINANCIAL RESOURCES FOR AND  HOLD  AN
 EQUITY  INTEREST AS OPERATORS OF RESIDENTIAL HEALTH CARE FACILITIES. ONE
 PROJECT SHALL BE IN THE UPSTATE REGION OF THE STATE.   THE OTHER  DEMON-
 STRATION  PROJECT SHALL BE IN A DOWNSTATE REGION IN THE STATE. IN ANTIC-
 IPATION OF THE FINANCIAL IMPACT ON RESIDENTIAL  HEALTH  CARE  FACILITIES
 FROM  THE  STATE'S EXPANSION OF MANDATORY MANAGED CARE TO LONG TERM CARE
 SERVICES, THE DEMONSTRATIONS SHALL BE DESIGNED TO PROMOTE  THE  DEVELOP-
 MENT  OF  NEW SOURCES OF CAPITAL FOR THE OPERATION OF RESIDENTIAL HEALTH
 CARE FACILITIES, AND TO MEASURE THE ABILITY OF SUCH INVESTMENT TO  POSI-
 TIVELY IMPACT FACILITIES IN TERMS OF CAPITAL IMPROVEMENTS, INVESTMENT IN
 NEW  TECHNOLOGY,  AND  IMPROVEMENT TO THE QUALITY OF CARE AND QUALITY OF
 LIFE FOR  FACILITY  RESIDENTS  MEASURED  BY  BROADLY  ACCEPTED  INDUSTRY
 METRICS  INCLUDING,  BUT  NOT  LIMITED TO, THOSE RELATED TO REDUCTION IN
 RATES OF REHOSPITALIZATON, MDS QUALITY INDICATORS,  END  OF  LIFE  CARE,
 MEDICAL  ORDERS  FOR  LIFE-SUSTAINING  TREATMENT  AND  NURSING  FACILITY
 "CULTURE CHANGE" INITIATIVES. THE FACILITIES PARTICIPATING IN THE DEMON-
 STRATIONS AND THE COMMISSIONER SHALL MUTUALLY  DEVELOP  THE  APPROPRIATE
 METRICS  TO  MEASURE  SUCH IMPACT WHICH SHALL SERVE AS THE BASIS FOR THE
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD01486-01-3
              

 A. 2738                             2
 
 REPORT TO THE GOVERNOR AND THE LEGISLATURE REQUIRED BY PARAGRAPH (H)  OF
 THIS SUBDIVISION.
   (B)  FOR PURPOSES OF SUCH DEMONSTRATIONS, THE COMMISSIONER MAY APPROVE
 DEMONSTRATION PROJECTS EACH INVOLVING THE  PURCHASE  OF  UP  TO  FIFTEEN
 EXISTING  RESIDENTIAL  HEALTH  CARE  FACILITIES  WHICH HAVE HISTORIES OF
 PROVIDING HIGH QUALITY CARE TO RESIDENTS.
   (C) THE EQUITY INVESTOR SHALL PARTICIPATE IN EACH FACILITY THROUGH THE
 CREATION OF LIMITED LIABILITY COMPANIES ESTABLISHED TO OPERATE THE RESI-
 DENTIAL HEALTH CARE FACILITIES.
   (D) THE RESIDENTIAL HEALTH CARE FACILITIES MAY BE OPERATED BY  LIMITED
 LIABILITY  COMPANIES  FORMED  PURSUANT  TO THE LIMITED LIABILITY COMPANY
 LAW, WHOSE MEMBERS ARE NOT NATURAL PERSONS  SO  LONG  AS  AT  LEAST  ONE
 MEMBER OF SUCH LIMITED LIABILITY COMPANIES IS A NATURAL PERSON OF SUFFI-
 CIENT  EXPERIENCE  AND  EXPERTISE IN DELIVERING HIGH QUALITY NURSING AND
 HEALTH RELATED CARE TO WHOM THE EQUITY INVESTOR HAS  DELEGATED,  TO  THE
 SATISFACTION OF THE PUBLIC HEALTH AND HEALTH PLANNING COUNCIL, RESPONSI-
 BILITY FOR THE DAY TO DAY MANAGEMENT AND OPERATION OF THE FACILITY.
   (E) THE PROVISIONS OF PARAGRAPH (B) OF SUBDIVISION THREE AND PARAGRAPH
 (C)  OF  SUBDIVISION  FOUR OF THIS SECTION SHALL NOT APPLY TO THE EQUITY
 INVESTOR OR ITS OWNERS; PROVIDED, HOWEVER, THAT THE  PUBLIC  HEALTH  AND
 HEALTH  PLANNING  COUNCIL MAY REQUIRE COMMERCIALLY REASONABLE DISCLOSURE
 OF THE IDENTITY OF LIMITED LIABILITY COMPANY MEMBERS, PROVIDED THAT  THE
 NUMBER OF INVESTORS IS NOT GREATER THAN THIRTY-FIVE.
   (F)  THE  PROVISIONS  OF PARAGRAPHS (E) AND (F) OF SUBDIVISION FOUR OF
 THIS SECTION SHALL NOT APPLY TO RESIDENTIAL HEALTH CARE FACILITIES OPER-
 ATED PURSUANT TO THIS SUBDIVISION. NOTHING IN THIS SECTION SHALL PROHIB-
 IT A LIMITED LIABILITY COMPANY FROM BEING THE SOLE MEMBER OF THE LIMITED
 LIABILITY COMPANIES REFERRED TO IN PARAGRAPHS (C) AND (D) OF THIS SUBDI-
 VISION PROVIDED THAT THE FORMER LIMITED LIABILITY COMPANY  OR  AT  LEAST
 ONE OF ITS MEMBERS CONFORMS TO THE REQUIREMENTS OF SUCH PARAGRAPHS.
   (G)  RESIDENTIAL  HEALTH  CARE FACILITIES PARTICIPATING IN THIS DEMON-
 STRATION PROGRAM SHALL BE SUBJECT TO  ALL  OPERATING  STANDARDS  AS  SET
 FORTH  IN  THIS ARTICLE AND THE REGULATIONS PROMULGATED PURSUANT THERETO
 AND SHALL BE SUBJECT TO ANY PROVISIONS OF THIS CHAPTER  FOR  FAILURE  TO
 COMPLY  WITH  SUCH  STANDARDS.  ADDITIONALLY,  FACILITIES IN THIS DEMON-
 STRATION PROGRAM SHALL COMPLY WITH ALL DEPARTMENT REGULATIONS PERTAINING
 TO ADMISSIONS OF MEDICAID PATIENTS.
   (H) NO LATER THAN TWO YEARS AFTER THE FIRST FACILITY COMMENCES  OPERA-
 TION  PURSUANT  TO  THIS  DEMONSTRATION  PROGRAM, THE COMMISSIONER SHALL
 PROVIDE THE GOVERNOR, THE TEMPORARY PRESIDENT  OF  THE  SENATE  AND  THE
 SPEAKER  OF  THE ASSEMBLY WITH A WRITTEN EVALUATION OF THE DEMONSTRATION
 PROGRAMS.  SUCH EVALUATION SHALL ADDRESS THE  OVERALL  EFFECTIVENESS  OF
 THE  PROGRAM  IN  PROVIDING  ACCESS TO CAPITAL INVESTMENT BY RESIDENTIAL
 HEALTH CARE FACILITIES AND EVALUATE THE IMPACT PRIVATE EQUITY INVESTMENT
 HAS ON THE QUALITY OF CARE AS EVIDENCED BY STAFF RETENTION  AND  QUALITY
 INDICATORS, AND ACCESS TO CARE FOR VARIOUS RESIDENT POPULATIONS.
   (I)  RESIDENTIAL  HEALTH  CARE FACILITIES PARTICIPATING IN THIS DEMON-
 STRATION PROGRAM SHALL SUBMIT SUCH QUALITY REPORTS AS SHALL BE  REQUIRED
 AND  DIRECTED BY THE COMMISSIONER, INCLUDING INFORMATION ON PATIENT CARE
 QUALITY INDICATORS, STAFFING LEVELS AND PATTERNS AND ACCESS TO CARE  FOR
 VARIOUS PATIENT POPULATIONS.
   §  2.  This  act  shall take effect on the sixtieth day after it shall
 have become a law. Effective immediately, the addition, amendment and/or
 repeal of any rule or regulation necessary  for  the  implementation  of
 this  act  on its effective date are authorized to be made and completed
 on or before such effective date.