AN ACT Relating to the licensing of home health agencies; amending RCW 70.126.010, 70.126.020, 70.126.040, 48.21.220, 48.21A.090, and 48.44.320; adding new sections to chapter 70.126 RCW; prescribing penalties; and providing an effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. The purpose of the licensing provisions of this chapter is to provide for the protection of the public by promoting the safe and competent care of ill, disabled, or infirm persons in the place of residence through the licensing of home health agencies.

Sec. 2. Section 5, chapter 249, Laws of 1983 as amended by section 4, chapter 22, Laws of 1984 and RCW 70.126.010 are each amended to read as follows:

Unless the context clearly requires otherwise, the definitions in this section apply throughout this chapter.

(1) "Hospice" means a private or public agency or organization that administers and provides hospice care and is certified by the department of social and health services as a hospice care agency.

(2) "Hospice care" means care prescribed and supervised by the attending physician and provided by the hospice to the terminally ill in accordance with the standards of RCW 70.126.030.

(3) "Home health agency" means a private or public agency or organization or person that administers ((~~and~~)) or provides home health care ((~~and is certified by the department of social and health services as a home health care agency~~)) to ill, disabled, or infirm persons in their residences.

(4) "Home health care" means ((services, supplies, and medical equipment that meet the standards of RCW 70.126.020, prescribed and supervised by the attending physician, and provided through a home health agency and rendered to members in their residences when hospitalization would otherwise be required)) health or medical services or medical supplies or equipment provided directly or through a contract arrangement to ill, disabled, or infirm persons in the place of residence. These services, which may be of an acute, maintenance care, preventive, therapeutic, rehabilitative, supportive or health guidance nature, include but are not limited to nursing services, home health aide services, physical, occupational, speech, respiratory, and other therapy services, and medical social services.

(5) "Residence" means a place in which a person resides.

(6) "Home health aide" means a person employed by a home health agency or a hospice who is providing ((~~part-time or intermittent~~)) care under the supervision of a registered nurse, a physical therapist, occupational therapist, or speech therapist. Such care includes ambulation and exercise, assistance with medications ordinarily self-administered, reporting changes in patients' conditions and needs, completing appropriate records, and personal care or household services that are needed to achieve the medically desired results.

((~~(6)~~)) (7) "Maintenance care" means care that is medically necessary to support an existing level of health and to preserve from further failure or decline.

(8) "Acute care" means a program provided by a home health agency for patients who are not medically stable or have not attained a satisfactory level of rehabilitation. These patients require frequent monitoring by a health care professional in order to maintain their health care status.

(9) "Home health care plan of treatment" means a written plan of care established and periodically reviewed by a physician that describes medically necessary home health care to be provided to a patient for treatment of illness or injury.

((~~(7)~~)) (10) "Hospice plan of care" means a written plan of care established and periodically reviewed by a physician that describes hospice care to be provided to a terminally ill patient for palliation or medically necessary treatment of an illness or injury.

((~~(8)~~)) (11) "Physician" means a physician licensed under chapter 18.57 or 18.71 RCW.

(12) "Department" means the department of social and health services.

(13) "Ill, disabled, or infirm persons" means persons who need either health or personal assistance in order to maintain themselves in their place of residence.

NEW SECTION. Sec. 3. No private or public agency or organization or person may provide home health care without first obtaining a home health agency license from the department, unless exempt from licensure pursuant to section 4 of this act.

NEW SECTION. Sec. 4. The following are exempt from section 3 of this act:

(1) A hospice organization certified pursuant to chapter 70.126 RCW that provides only palliative care;

(2) A family member;

(3) A licensed health care practitioner operating within the scope of practice;

(4) Private or public agencies or organizations or persons who provide only personal care, homemaker, chore, or respite services to ill, disabled, or infirm persons in the place of residence. These services are designed to enable these persons to remain in their own residences consistent with their desires, abilities, and safety;

(5) An organization that provides only meal services in a person's residence;

(6) A medical equipment company that furnishes durable medical equipment and no professional services;

(7) A person who provides one service through a contract with a licensed home health agency; and

(8) An employee of a licensed home health agency who provides services only as an employee and who receives no benefit for providing services other than compensation received from the employer.

NEW SECTION. Sec. 5. Any nursing home, hospital, or other health care institution when functioning as a home health agency is not required to obtain a license under this chapter but shall comply with such reasonable rules as may be adopted by the department. The authority to operate as a home health agency may be suspended or revoked by the department for failure to comply with the rules.

Sec. 6. Section 6, chapter 249, Laws of 1983 as amended by section 5, chapter 22, Laws of 1984 and RCW 70.126.020 are each amended to read as follows:

For the purposes of RCW 48.21.220, 48.21A.090, and 48.44.320:

(1) Home health care shall be provided by a home health agency pursuant to the home health care plan of treatment and shall:

(a) Be delivered by a registered nurse, physical therapist, occupational therapist, speech therapist, or home health aide on a part-time or intermittent basis;

(b) Include, as applicable under the ((~~written plan~~)) home health care plan of treatment, supplies and equipment such as:

(i) Drugs and medicines that are legally obtainable only upon a physician's written prescription, and insulin;

(ii) Rental of durable medical apparatus and medical equipment such as wheelchairs, hospital beds, respirators, splints, trusses, braces, or crutches needed for treatment;

(iii) Supplies normally used for hospital inpatients and dispensed by the home health agency such as oxygen, catheters, needles, syringes, dressings, materials used in aseptic techniques, irrigation solutions, and intravenous fluids.

(2) The following services may be included when medically necessary, ordered by the attending physician, and included in the approved home health care plan of treatment:

(a) Licensed practical nurses;

(b) Respiratory therapists;

(d) Ambulance service that is certified by the physician as necessary in the approved plan of treatment because of the patient's physical condition or for unexpected emergency situations.

(3) Services not included in home health care include:

(a) Nonmedical, custodial, or housekeeping services except by home health aides as ordered in the approved plan of treatment;

(b) "Meals on Wheels" or similar food services;

(d) Services performed by family members;

(e) Services not included in an approved home health care plan of treatment;

(f) Supportive environmental materials such as handrails, ramps, telephones, air conditioners, and similar appliances and devices.

(4) An insurer, as a condition of reimbursement, may require compliance with home health certification regulations established by the department of health and human services and accreditation standards established by the joint commission on accreditation of hospitals.

NEW SECTION. Sec. 7. (1) An applicant for a home health agency license must:

(a) File a written application on a form provided by the department;

(b) Demonstrate ability to comply with this chapter and implementing standards or rules;

(c) File and maintain with the department a surety bond issued by a surety insurer who meets the requirements of chapter 48.28 RCW in a form acceptable to the department in favor of the state of Washington in the sum of fifteen thousand dollars, conditioned that the applicant will comply with this chapter and implementing rules. A cash deposit or other security acceptable to the department may be made with the department in lieu of a bond. The department may waive the surety bond requirement for applicants that satisfy the surety requirements of another state agency or department;

(d) Cooperate with on-site review conducted by the department prior to licensure and renewal;

(e) Provide evidence of and maintain professional liability insurance in the amount of one hundred thousand dollars per occurrence or adequate self-insurance as approved by the department;

(f) Provide evidence of and maintain public liability and property damage insurance coverage in the sum of fifty thousand dollars for injury or damage to property and fifty thousand dollars for injury or damage, including death, to any one person and one hundred thousand dollars for injury or damage, including death, to more than one person, or evidence of adequate self-insurance for public liability and property damage as approved by the department;

(g) Provide such proof as the department may require concerning the identity of the applicant, officers, directors, partners, managing employees, or owners of five percent or more of the applicant's assets;

(h) File with the department a list of the counties in which the applicant will operate as a home health agency;

(i) Pay to the department a license fee as provided in section 8 of this act; and

(j) Provide any other information that the department may reasonably require.

(2) No license or renewal may be granted pursuant to this chapter if the applicant, officers, directors, partners, managing employees, or owners of five percent or more of the applicant's assets, within the last ten years have been found in a civil or criminal proceeding to have committed any act which reasonably relates to the person's fitness to establish, maintain, or administer a home health agency or to provide care in the home of another.

NEW SECTION. Sec. 8. An application for a home health agency license or any renewal shall be accompanied by a fee as established by the department under RCW 43.20A.055.

NEW SECTION. Sec. 9. Upon receipt of an application under section 7 of this act for a license or renewal and the license fee, the department shall issue a license if the applicant meets the requirements established under this chapter. In addition, issuance of a license is conditioned on the department conducting an on-site review. The department shall adopt rules on notice requirements for on-site reviews. A license issued under this chapter shall not be transferred or assigned. A home health agency license, unless suspended or revoked, shall be effective for a period of up to two years, at the discretion of the department.

NEW SECTION. Sec. 10. The governor shall appoint a nine-member home health care advisory council.

(1) The council shall consist of:

(a) Three members of the general public who are not owners or employees of a home health agency and do not provide home health care services. In addition, the three general public members shall not be associated in any way with an organization that contracts for or directly provides home health care services. Of these three members, one shall be a representative of senior citizens and one shall be a representative of disabled or handicapped persons;

(b) Three members who are employed by home health agencies;

(d) One member who is a registered nurse who is not employed by a home health agency; and

(e) One member who is a licensed physical or occupational therapist, social worker with a master's degree, or speech and hearing therapist, and who is not employed by a home health agency.

(2) The governor shall choose one of the three members from the general public to be chair of the home health care advisory council. Members of the council shall be reimbursed for travel expenses in accordance with RCW 43.03.050 and 43.03.060. Each member shall serve for a term of three years, except that any member appointed to fill a vacancy shall serve for the remainder of the unexpired term. The terms of office of the members first taking office shall expire, as designated at the time of appointment, three at the end of the first year, three at the end of the second year, and three at the end of the third year after the date of appointment. Thereafter, all appointments shall be for three years. The council shall meet as frequently as the chair deems necessary, but not less than quarterly each year. Upon request by three or more members, it is the duty of the chair to call a meeting of the council.

(3) The home health care advisory council shall consult with the department in matters of policy affecting home health agencies on a quarterly basis.

NEW SECTION. Sec. 11. The department shall adopt rules and standards necessary to implement this chapter in accordance with chapter 34.04 RCW. The department rules shall address the following:

(1) Maintenance and preservation all records that relate directly to the care and treatment of persons by licensees;

(2) Establishment of a procedure for recording and evaluating complaints of persons receiving care from licensees pursuant to this chapter;

(3) Establishment and implementation of a plan that provides for on-going care of persons and preservation of records if the licensee ceases operations;

(4) Delivery of a majority of the services directly;

(5) Supervision of the services by a physician or a registered nurse as appropriate for acute or maintenance care patients;

(6) Renewal of physician's orders as appropriate for acute and maintenance care patients;

(7) Continuing education and in-service training of direct service and contract staff;

(8) On-site supervision of services at appropriate intervals for acute or maintenance care patients;

(9) Qualifications and minimum training requirements of all home health agency personnel;

(10) Maintenance of written policies regarding response to referrals and access to services during weekends, holidays, and after-office hours;

(11) Maintenance of written personnel policies and procedures and personnel records that provide for regular performance evaluations, including observation in the home, participation in orientation and in-service training, and involvement in quality assurance activities;

(12) Maintenance of written policies regarding consultation on clinical questions and provision for either patient care conferences or interdisciplinary team meetings and coordination with referral sources and community resources; and

(13) Requirement that home health agencies accept patients regardless of their location within the county.

Sec. 12. Section 8, chapter 249, Laws of 1983 as amended by section 7, chapter 22, Laws of 1984 and RCW 70.126.040 are each amended to read as follows:

For the purposes of RCW 48.21.220, 48.21A.090, and 48.44.320, the department of social and health services shall adopt rules establishing standards for the certification of ((~~home health agencies and~~)) hospices under this chapter. These standards shall be compatible with and at least as stringent as ((~~home health and~~)) hospice certification regulations established by the United States department of health and human services and hospice accreditation standards established by the joint commission on accreditation of hospitals.

NEW SECTION. Sec. 13. Nothing in this chapter shall be interpreted as prohibiting persons who are receiving home care from being eligible to receive home health care when medically necessary.

NEW SECTION. Sec. 14. (1) A home health agency shall provide each patient or designated representative with a written statement affirming the person's right to receive the following information:

(a) A written statement of services offered, and applicable charges, if any;

(b) Written disclosure of the policy on uncompensated care;

(c) The name of the responsible person supervising the patient's home health care and the manner in which that person may be contacted;

(d) A description of the process for addressing patient complaints; and

(e) A written statement providing that the patient or designated representative is entitled to select any licensed home health agency to provide care, subject to the patient's reimbursement mechanism.

(2) Upon request, a home health agency shall provide each patient with a fully itemized monthly billing statement, including date of service and charge. Home health agencies receiving prepayments for services shall not be required to provide itemized monthly billing statements.

NEW SECTION. Sec. 15. The department shall adopt rules pursuant to section 11 of this act governing the procedure for the receipt, timely investigation, and disposition of complaints regarding services provided by licensees. This section does not apply to a home health agency that maintains a meaningful grievance procedure subject to approval by another state department or agency.

NEW SECTION. Sec. 16. In order to assist the department in the administration of this chapter, the department may adopt rules pursuant to section 11 of this act to provide that a home health agency that was certified pursuant to chapter 70.126 RCW immediately prior to the effective date of this act continue to operate under the current certification through the expiration date of the certificate.

NEW SECTION. Sec. 17. Pursuant to chapter 34.04 RCW, the department is authorized to deny, suspend, or revoke a license under this chapter or, in lieu thereof or in addition thereto, assess monetary penalties of a civil nature not to exceed one thousand dollars per violation in any case in which it finds that the licensee, or any applicant, officer, director, partner, managing employee, or owner of five percent of more of the applicant's assets:

(1) Failed or refused to comply with the requirements of this chapter or the standards or rules adopted hereunder;

(2) Was the holder of a license issued pursuant to this chapter that was revoked for cause and never reissued by the department, or that was suspended for cause and the terms of the suspension have not been fulfilled;

(3) Has knowingly or with reason to know made a false statement of a material fact in the application for license or any data attached thereto or in any record required by this chapter or matter under investigation by the department;

(4) Refused to allow representatives of the department to inspect any book, record, or file required by this chapter to be maintained or any portion of the premises of the home health agency or home care provider;

(5) Wilfully prevented, interfered with, or attempted to impede in any way the work of any representative of the department and the lawful enforcement of any provision of this chapter;

(6) Wilfully prevented or interfered with any representative of the department in the preservation of evidence of any violation of this chapter or the rules adopted hereunder; or

(7) Fails to pay any civil monetary penalty assessed by the department pursuant to this chapter within ten days after the assessment becomes final.

NEW SECTION. Sec. 18. The department may at any time conduct an on-site review of a home health agency in order to determine compliance with this chapter. The department may also examine and audit records necessary to determine compliance with this chapter. The right to conduct an on-site review and audit and examination of records shall extend to any premises and records of persons whom the department has reason to believe are providing home health care without a license.

Following an on-site review or audit, the department shall give written notice of any violation of this chapter or the rules adopted under this chapter. The notice shall describe the reasons for noncompliance and inform the home health agency that it must comply, or appeal the decision under chapter 34.04 RCW, within a specified reasonable time, not to exceed sixty days. If the licensee fails to comply or appeal, the licensee is subject to disciplinary action under section 17 of this act.

NEW SECTION. Sec. 19. All information received by the department through filed reports, audits, on-site reviews, or as otherwise authorized under this chapter shall not be disclosed publicly in any manner as to identify persons receiving care under this chapter.

NEW SECTION. Sec. 20. Notwithstanding the existence or use of any other remedy, the department may, in the manner provided by law and upon the advice of the attorney general, who shall represent the department in the proceedings, maintain an action in the name of the state for an injunction or other process against any person to restrain or prevent the operation or maintenance of a home health agency without a license under this chapter.

NEW SECTION. Sec. 21. A person having a claim against a licensed home health agency for failure to comply with this chapter and implementing rules may bring suit upon the bond required by section 7 of this act in the superior court of the county in which the home health agency is located. Action upon the bond or deposit shall be commenced by filing a complaint with the clerk of the appropriate superior court within one year from the date of the incident. Service of process in an action upon the bond shall be exclusively by service on the department. Three copies of the complaint and a fee of ten dollars to cover the handling costs shall be served by registered or certified mail upon the department at the time suit is initiated and the department shall maintain a record, available for public inspection, of all suits so commenced. Service is not complete until the department receives the fee and three copies of the complaint. Such service shall constitute service on the licensee and the surety for suit upon the bond and the department shall transmit the complaint or a copy thereof to the licensee at the address listed in the application and to the surety within forty-eight hours after it has been received.

The surety upon the bond shall not be liable in an aggregate amount in excess of the amount named in the bond. The surety upon the bond may, upon notice to the department and the parties, tender to the clerk of the court having jurisdiction of the action an amount equal to the claims thereunder or the amount of the bond less the amount of judgments, if any, previously satisfied therefrom and, to the extent of such tender, the surety upon the bond is exonerated. If the actions commenced and pending at any one time exceed the amount of the bond then unimpaired, claims shall be satisfied from the bond in the order in which judgment is entered.

If any final judgment impairs the liability of the surety upon the bond and there is not in effect a bond undertaking in the amount of fifteen thousand dollars, the department shall suspend the license of the home health agency until the bond liability in the required amount unimpaired by unsatisfied judgment claims has been furnished.

A person having an unsatisfied final judgment against the licensee for failure to comply with this chapter and implementing rules may execute upon the cash deposit or security held by the department by serving a certified copy of the unsatisfied final judgment by registered or certified mail on the department within one year of the date of entry of the judgment. Upon the receipt of service of such certified copy, the department shall pay or order paid from the deposit or security, through the registry of the superior court that rendered judgment, toward the amount of the unsatisfied judgment. The priority of payment by the department shall be the order of receipt by the department, but the department has no liability for payment in excess of the amount of the deposit.

If any final judgment reduces the cash deposit or security below fifteen thousand dollars, the department shall suspend the license of the home health agency until the licensee deposits sufficient cash or other security to equal twenty-five thousand dollars.

NEW SECTION. Sec. 22. Any person providing home health care without a license under this chapter who is not exempt from licensure pursuant to section 4 of this act is guilty of a misdemeanor and each day of a continuing violation after conviction shall be considered a separate offense.

Sec. 23. Section 1, chapter 249, Laws of 1983 as amended by section 1, chapter 22, Laws of 1984 and RCW 48.21.220 are each amended to read as follows:

(1) Every insurer entering into or renewing group or blanket disability insurance policies governed by this chapter shall offer optional coverage for home health care and hospice care for persons who are homebound and would otherwise require hospitalization. Such optional coverage need only be offered in conjunction with a policy that provides payment for hospitalization as a part of health care coverage.

(2) Home health care and hospice care coverage offered under subsection (1) of this section shall conform to the following standards, limitations, and restrictions:

(a) The coverage may include reasonable deductibles, coinsurance provisions, and internal maximums;

(b) The coverage should be structured to create incentives for the use of home health care and hospice care as an alternative to hospitalization;

(d) The coverage may require that home health agencies and hospices have written treatment plans approved by a physician licensed under chapter 18.57 or 18.71 RCW, and may require such treatment plans to be reviewed at designated intervals;

(e) The coverage shall provide benefits for, and may restrict benefits to, services rendered by home health agencies licensed and hospices certified by the department of social and health services;

(f) Hospice care coverage shall provide benefits for terminally ill patients for an initial period of care of not less than six months and may provide benefits for an additional six months of care in cases where the patient is facing imminent death or is entering remission if certified in writing by the attending physician;

(g) Home health care coverage shall provide benefits for a minimum of one hundred thirty health care visits per calendar year. However, a visit of any duration by an employee of a home health agency for the purpose of providing services under the plan of treatment constitutes one visit;

(h) The coverage may be structured so that services or supplies included in the primary contract are not duplicated in the optional home health and hospice coverage.

(3) The insurance commissioner shall adopt any rules necessary to implement this section.

(4) The requirements of this section shall not apply to contracts or policies governed by chapter 48.66 RCW.

Sec. 24. Section 2, chapter 249, Laws of 1983 as amended by section 2, chapter 22, Laws of 1984 and RCW 48.21A.090 are each amended to read as follows:

(1) Every insurer entering into or renewing extended health insurance governed by this chapter shall offer optional coverage for home health care and hospice care for persons who are homebound and would otherwise require hospitalization. Such optional coverage need only be offered in conjunction with a policy that provides payment for hospitalization as a part of health care coverage.

(2) Home health care and hospice care coverage offered under subsection (1) of this section shall conform to the following standards, limitations, and restrictions:

(a) The coverage may include reasonable deductibles, coinsurance provisions, and internal maximums;

(b) The coverage should be structured to create incentives for the use of home health care and hospice care as an alternative to hospitalization;

(e) The coverage shall provide benefits for, and may restrict benefits to, services rendered by home health agencies licensed and hospices certified by the department of social and health services;

(h) The coverage may be structured so that services or supplies included in the primary contract are not duplicated in the optional home health and hospice coverage.

(3) The insurance commissioner shall adopt any rules necessary to implement this section.

(4) The requirements of this section shall not apply to contracts or policies governed by chapter 48.66 RCW.

Sec. 25. Section 3, chapter 249, Laws of 1983 as amended by section 3, chapter 22, Laws of 1984 and RCW 48.44.320 are each amended to read as follows:

(1) Every health care service contractor entering into or renewing a group health care service contract governed by this chapter shall offer optional coverage for home health care and hospice care for persons who are homebound and would otherwise require hospitalization. Such optional coverage need only be offered in conjunction with a policy that provides payment for hospitalization as a part of health care coverage.

(2) Home health care and hospice care coverage offered under subsection (1) of this section shall conform to the following standards, limitations, and restrictions:

(a) The coverage may include reasonable deductibles, coinsurance provisions, and internal maximums;

(b) The coverage should be structured to create incentives for the use of home health care and hospice care as an alternative to hospitalization;

(e) The coverage shall provide benefits for, and may restrict benefits to, services rendered by home health agencies licensed and hospices certified by the department of social and health services;

(h) The coverage may be structured so that services or supplies included in the primary contract are not duplicated in the optional home health and hospice coverage.

(3) The insurance commissioner shall adopt any rules necessary to implement this section.

(4) The requirements of this section shall not apply to contracts or policies governed by chapter 48.66 RCW.

NEW SECTION. Sec. 26. Sections 1, 3 through 5, 7 through 11, and 13 through 22 of this act are each added to chapter 70.126 RCW.

NEW SECTION. Sec. 27. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION. Sec. 28. This act shall take effect January 1, 1988.