BILL ANALYSIS

S.B. 1383

By: Middleton

Human Services

Committee Report (Unamended)

BACKGROUND AND PURPOSE

The bill sponsor has informed the committee that a person is prohibited from accepting compensation for soliciting clients to an entity licensed, certified, or registered by a health care agency in Texas, with certain exceptions. S.B. 1383 seeks to benefit Texans by providing for a framework where this practice can be legalized and regulated.

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

S.B. 1383 amends the Business & Commerce Code to require a referral agency for senior living communities, at the time of a referral, to provide a disclosure statement to the consumer that includes the following:

· a description of the referral agency's services;

· a statement on whether the consumer or the senior living community to which the consumer is referred is responsible for paying the referral fee; and

· a statement that the consumer may stop using the referral agency at any time without cause or penalty.

The bill requires a referral agency to provide the disclosure statement to a consumer in the form of a written physical or electronic document and to consider the consumer's preferences in selecting the senior living community to which the agency refers the consumer. The bill prohibits a referral agency from using cost as the sole factor in that selection. The bill prohibits a senior living community from being required to contract with or otherwise use a referral agency. The bill requires a referral agency, if a consumer decides to stop using the referral agency, to communicate the consumer's decision to all senior living communities to which the referral agency has referred the consumer. A consumer's decision to stop using a referral agency does not affect a contractual agreement, if any, between the referral agency and a senior living community.

S.B. 1383 prohibits a referral agency from doing the following:

· referring a consumer to a senior living community in which the referral agency has an ownership, management, or financial interest;

· holding a power of attorney for a consumer or holding a consumer's property in any capacity;

· knowingly referring a consumer to a senior living community that is unlicensed and is not exempt from licensing under applicable law;

· collecting a referral fee when a consumer transfers from one property of a senior living community to another property of the same senior living community unless the consumer has engaged the referral agency to help facilitate the consumer's transfer to another property and the referral agency provided the consumer more than one referral; or

· collecting a referral fee after the expiration of the referral according to the contract between the referral agency and the senior living community.

S.B. 1383 requires a referral agency to do the following:

· use a nationally accredited service provider to obtain criminal history record information of:

o a new employee of the referral agency who will have direct contact with a consumer; and

o a referral agency employee who physically enters a senior living community for the purpose of making a referral to a consumer;

· maintain liability insurance coverage for negligent acts or omissions by the referral agency or its employees;

· audit each senior living community with respect to which the referral agency provides referrals to ensure that any applicable license is in good standing and maintain a record of that audit;

· provide training to all referral agency employees whose job responsibilities require direct contact with a consumer, including training on the referral agency's code of conduct, before the employee begins performing those responsibilities;

· if a referral agency refers a consumer to a senior living community, notify the senior living community of the referral by a written physical or electronic document that includes the time and date of the referral, on or before the date the consumer is admitted to the senior living community; and

· if a referral agency enters into a contract with a senior living community, specify in the contract the period within which the senior living community must pay the referral agency, not to exceed three years after the date the referral agency provided a consumer a referral to the senior living community.

S.B. 1383 authorizes a written contract entered into between a referral agency and a senior living community to provide for the compensation of a referral agency for all referrals made with respect to a senior living community and authorizes the amount of compensation to be based on the volume or value of referrals made by the referral agency or business generated between the parties. The bill establishes that compensation paid to a referral agency that is in compliance with the bill's provisions relating to compensation is not grounds for disciplinary action against a senior living community. The bill prohibits a referral agency from offering or entering into a contract for compensation prohibited under federal law that provides for criminal penalties for acts involving federal health care programs or under any other federal law or rule.

S.B. 1383 expressly does not do the following:

· affect the application of any other law that regulates a senior living community; or

· abrogate any other defense, remedy, immunity, or privilege available under the U.S. Constitution or Texas Constitution or as provided by any statute, case, or common law or rule.

S.B. 1383 defines the following terms:

· "consumer" as an individual seeking a referral to a senior living community;

· "referral agency" as an entity that provides referrals of senior living communities to consumers for a fee collected from a consumer or community, not including the following:

o a senior living community or its employees; or

o a resident, resident's family member, or patron of a senior living community who refers a consumer to the community regardless of any discount or other remuneration the community pays to that individual; and

· "senior living community" as an adult foster care facility, life care facility, assisted living facility licensed under applicable Health and Safety Code provisions, retirement home, memory care facility, retirement village, home for the aging, or other facility that provides shelter, food, social activities, or other personal services specifically for elderly individuals.

S.B. 1383 amends the Occupations Code to include a referral agency among the entities excepted from the applicability of provisions relating to the offense of soliciting patients.

EFFECTIVE DATE

On passage, or, if the bill does not receive the necessary vote, September 1, 2025.