Relating to the regulation of referral agencies for senior living communities.
SB 1383 creates a new regulatory framework in Texas for referral agencies that connect consumers with senior living communities. The bill defines who counts as a referral agency and who counts as a senior living community, then requires agencies to give consumers a written disclosure at the time of referral explaining the agency’s services, who pays the fee, the consumer’s right to stop using the agency, and the fact that the agency’s list may not include every available community. It also requires agencies to consider consumer preferences, prohibits them from using cost as the sole selection factor, and bars senior living communities from being forced to contract with a referral agency.
The bill further restricts referral agencies from steering consumers to communities in which they have an ownership or financial interest, from holding a consumer’s power of attorney or property, from referring consumers to unlicensed facilities, and from collecting certain fees outside specified circumstances. It imposes operational duties such as background checks for certain employees, liability insurance, license audits of referred communities, employee training, notice to communities when a referral is made, and contract terms limiting how long referral fees may be collected. The bill also states that compliant compensation arrangements are not grounds for disciplinary action against a senior living community, while preserving federal anti-kickback restrictions and other applicable laws.
SB 1383 adds Chapter 121 to the Business & Commerce Code and makes a conforming amendment to the Occupations Code to exclude referral agencies from a general provision applicable to certain entities. In practical terms, it regulates the business practices of senior-living placement and referral services, while also affecting senior living communities, assisted living facilities, retirement homes, memory care facilities, and similar providers serving elderly individuals. The bill does not replace existing licensing or consumer-protection laws; instead, it overlays disclosure, conflict-of-interest, recordkeeping, and contracting requirements on referral agencies operating in this market.
The bill appears to have received generally favorable support, as reflected by strong passage margins in both chambers and final enactment. The Senate passed the bill 30-1, the House passed it 106-15 with one present not voting, and the Senate later concurred in the House amendment 30-1. The broad bipartisan vote pattern suggests consensus around the need for clearer rules and consumer protections in senior-living referrals, even though a minority of members opposed or withheld support.
The main points of contention likely centered on how heavily to regulate referral agencies and whether the bill could affect business relationships between agencies and senior living communities. The bill addresses concerns about conflicts of interest, steering, and fee arrangements by prohibiting ownership-linked referrals, requiring disclosures, and limiting compensation practices, while supporters likely viewed these as necessary consumer safeguards. Opponents may have been concerned about compliance burdens, background-check and insurance requirements, and the bill’s effect on referral-based marketing and placement services. The narrow but consistent opposition in both chambers indicates some disagreement, but not enough to prevent passage.