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HB 5738

Health: licensing; references to licenses for certain substance use disorder services programs in the adult foster care facility licensing act; modify to include those exempt from licensure. Amends secs. 3 & 26a of 1979 PA 218 (MCL 400.703 & 400.726a). TIE BAR WITH: HB 5729'26

2025-2026 Regular Session Introduced by Karl Bohnak and 2 co-sponsors

HB 5738 would recognize and align adult foster care facilities that are exempt from licensure as SUD services programs, enabling co-occurring crisis programs while maintaining prot

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#health:controlledsubstances #health:licensing #health:substanceusedisorder #health:substanceusedisordertreatment
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Bill Summary · HB 5738

Summary of HB 5738 (2025-2026) – Michigan

Main purpose and intent

  • HB 5738 would amend the Adult Foster Care Facility Licensing Act (1979 PA 218) to update licensing references related to substance use disorder (SUD) services programs. Specifically, it adds licensing references to include entities that are exempt from licensure under Part 62 of the Public Health Code.
  • The bill ties its enactment to House Bill 5729; it takes effect only if HB 5729 becomes law.

Key provisions and changes

  • Amends Sec. 3 and Sec. 26a of the Adult Foster Care Facility Licensing Act:
    • Defines and clarifies terms related to adult foster care facilities (adult, adult foster care facility, family home, small/large group homes, etc.).
    • Keeps existing exclusions for certain healthcare facilities (nursing homes, hospitals, etc.) and special cases (e.g., certain child care–related facilities, areas excluded under other acts).
    • Adds reference to adult foster care facilities that are exempt from licensure as SUD services programs, allowing them to be recognized in relation to co-occurring enhanced crisis residential programs and other contexts.
  • Section 26a(2) and (3) recognize that residents enrolled in hospice or in SUD services programs exempt from licensure (but approved as co-occurring enhanced crisis residential programs) are not considered to require continuous nursing care for purposes of certain provisions. This provides protective alignment for facilities serving these residents.
  • Enacting clause stipulates the act does not take effect unless HB 5729 is enacted.

Affected entities and beneficiaries

  • Directly affects adult foster care facilities and their licensing framework by:
    • Incorporating facilities/programs that are exempt from Part 62 licensure into the regulatory landscape for co-occurring enhanced crisis residential programs.
    • Potentially reducing licensure barriers for providers that deliver SUD services but are exempt from licensure, while ensuring alignment with rulemaking.
  • Residents of adult foster care facilities (including those enrolled in hospice or in SUD services programs) who are connected to these exemptions may benefit from clarified licensure status and continued protection regarding nursing care requirements.
  • The companion bills (HB 5728, 5730–5737) would broaden conformity across various codes and acts, affecting hospitals, crisis stabilization units, zoning, health care contracting, and related regulatory definitions.

Procedural and timeline aspects

  • The bill is introduced March 18, 2026, and referred to the Health Policy Committee.
  • It includes an enactment condition: it becomes effective only if HB 5729 is enacted.
  • Fiscal note (HB 5729): Potential indeterminate impact on the Department of Licensing and Regulatory Affairs (LARA) due to changes in licensure requirements and potential loss of license revenue from facilities no longer needing a separate SUD program license (annual license renewal fee cited as $500).
  • Companion bills provide a coordinated package of conforming changes across multiple statutes and regulatory programs; approval of HB 5729 appears prerequisite for the effective changes in HB 5738.

Practical considerations

  • Effects on licensing: May reduce administrative/licensing burdens for certain hospitals, crisis stabilization units, and SUD program providers by recognizing exemptions from licensure, while maintaining standards via proposed rulemaking.
  • Rulemaking: HB 5729 would direct LARA to establish detailed rules for SUD services programs, covering categories, governance, staffing, procedures, audits, quality control, facility standards, and other operational requirements.
  • Implementation: Timing and fiscal impact depend on passage of the broader package (HB 5729 and related companion bills), with potential revenue impacts to LARA and changes in licensing practice for providers.

If you’d like, I can extract specific clause-by-clause implications or create a side-by-side comparison with current law.

Compiled from official sources — confirm details with the bill’s official record.

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