An Act to amend the Code of Virginia by adding a section numbered 32.1-126.6, relating to nursing homes; change of operator; application to Commissioner of Health for change of operator license; civil penalty.
SB247 creates a new Virginia licensing and oversight process for a nursing home “change of operator.” Before a new operator can take over daily management of a nursing home after a change in ownership or control, the operator must apply to the Commissioner of Health for a change-of-operator license and meet a series of disclosure, financial, and operational requirements. The application must identify major owners and related parties, disclose prior involvement in nursing homes in Virginia or other states, and report whether those facilities experienced closures, bankruptcy, receivership, licensure actions, special-focus-facility designation, or civil/criminal actions within the prior five years.
The bill also requires the entering operator to show financial security through a bond or similar instrument equal to $10,000 per licensed bed, unless an ownership threshold exception applies, and to maintain that security for five years after the change. In addition, the operator must demonstrate at least five years of nursing home management experience, attest to quality assurance and risk management plans, liability insurance, and adequate staffing. The Commissioner must issue a notice of intent to grant the license once the requirements are met, and the Department of Medical Assistance Services must conduct provider screening for Medicare or Medicaid participation. The bill preserves existing nursing home licensure requirements and directs the Board of Health to adopt implementing regulations, with initial regulations exempt from the Administrative Process Act.
The act adds § 32.1-126.6 to the Code of Virginia and gives the Commissioner of Health new authority to review, approve, deny, and monitor nursing home operator transitions. It creates new disclosure obligations, financial assurance requirements, and grounds for denial tied to prior facility failures or regulatory actions, while also authorizing civil penalties for failing to apply, filing fraudulent information, or failing to update required information. Penalty proceeds go to the general fund, and a failure to cure an unfiled application within 60 days can trigger the license revocation process under existing law. The Board of Health must promulgate regulations to implement the new section.
The bill appears to have been broadly supported and noncontroversial in the legislative process. It advanced unanimously or near-unanimously through Senate committees and floor votes and passed the House overwhelmingly, suggesting strong bipartisan agreement on increasing oversight of nursing home ownership and management changes. The available record shows no recorded opposition votes and no committee transcript debate, indicating a generally favorable reception.
No specific points of contention are documented in the available committee materials, but the bill’s substantive burdens suggest the likely policy issues were the scope of state oversight, the size and duration of the required bond, and the denial criteria tied to prior ownership history. Potentially affected parties include nursing home operators, owners, related-party service providers, and facilities seeking to change control or participate in Medicare or Medicaid. The bill’s exceptions for certain financial institutions and for affiliated ownership structures may also have been relevant to stakeholders concerned about financing and transaction costs.