BILL ANALYSIS

Senate Research Center	C.S.S.B. 1383
89R22093 JTZ-F	By: Middleton; Johnson
	Health & Human Services
	4/15/2025
	Committee Report (Substituted)

AUTHOR'S / SPONSOR'S STATEMENT OF INTENT

State law currently does not directly regulate agencies that refer persons to senior living communities. The committee substitute to S.B. 1383 would address that issue by creating a chapter in the Business & Commerce Code specifically for referral agencies for senior living communities. Senior living communities would include adult foster care facilities, assisted living facilities, retirement villages, and any other facility that provides shelter, food, social activities, or other personal services specifically for elderly individuals. C.S.S.B. 1383 would establish requirements for referral services, including disclosure requirements. The bill would also codify certain prohibited conduct and duties of referral agencies. The bill would describe the range of compensation arrangements referral agencies and communities may enter and provide that current law relating prohibited compensation of health care providers does not apply to referral agencies as defined by the chapter. Finally, the bill would clarify that the law would not impact other laws regulating senior living communities, nor does it abrogate or lessen any existing defenses or remedies.

C.S.S.B. 1383 amends current law relating to the regulation of referral agencies for senior living communities.

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Subtitle C, Title 5, Business & Commerce Code, by adding Chapter 121, as follows:

CHAPTER 121. REFERRAL AGENCIES FOR SENIOR LIVING COMMUNITIES

Sec. 121.001. DEFINITIONS. Defines "consumer," "referral agency," and "senior living community."

Sec. 121.002. REFERRAL AGENCIES; REQUIRED DISCLOSURE. (a) Requires a referral agency, at the time of a referral, to provide a disclosure statement to the consumer that includes 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 is authorized to stop using the referral agency at any time without cause or penalty.

(b) Requires a referral agency to provide the disclosure statement described by Subsection (a) to a consumer in the form of a written physical or electronic document.

(c) Requires a referral agency to consider the consumer's preferences in selecting the senior living community to which the agency refers the consumer, and prohibits a referral agency from using cost as the sole factor in that selection.

(d) Prohibits a senior living community from being required to contract with or otherwise use a referral agency.

(e) Requires a referral agency, if a consumer decides to stop using the referral agency, to communicates the consumer's decision to all senior living communities to which the referral agency has referred the consumer. Provides that 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.

Sec. 121.003. REFERRAL AGENCY PROHIBITED CONDUCT. Prohibits a referral agency from 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.

Sec. 121.004. DUTIES. Requires a referral agency to:

(1) use a nationally accredited service provider to obtain criminal history record information of a new employee of the referral agency who will have direct contact with a consumer and a referral agency employee who physically enters a senior living community for the purpose of making a referral to a consumer;

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

(3) 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;

(4) 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;

(5) 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 facility; and

(6) 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 is required to 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.

Sec. 121.005. COMPENSATION. (a) 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 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.

(b) Provides that, notwithstanding any other law, compensation paid to a referral agency that is in compliance with this section is not grounds for disciplinary action against a senior living community.

Sec. 121.006. EFFECT OF LAW. Provides that this chapter does not 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 Constitution of the United States or this state or as provided by any statute, case, or common law or rule.

SECTION 2. Amends Section 102.005, Occupations Code, as follows:

Sec. 102.005. APPLICABILITY TO CERTAIN ENTITIES. Provides that Section 102.001 (Soliciting Patients; Offense) does not apply to certain entities, including a referral agency as defined by Section 121.001, Business & Commerce Code. Makes nonsubstantive changes.

SECTION 3. Effective date: upon passage or September 1, 2025.