Bill
S 2776
The bill expands oversight of home-based health and personal care firms by requiring registration, accreditation, enhanced financial reporting, audits, and penalties for non-compli
Title: Makes various changes to regulation of health care service firms
Purpose
- To reform state regulation of entities that provide or arrange health care, personal care, or companion services in the home, by expanding registration requirements, updating accreditation and reporting rules, and strengthening oversight and enforcement.
Key Provisions
1) Expanded Registration Requirement
- Any employment agency or other entity that employs, places, or refers individuals to provide companion services, health care services, or personal care services in the home of a person with a disability or age 60+ must register as a Health Care Service Firm if it is not already a licensed home health care agency or hospice.
- Applies regardless of business model (employment, online platforms, etc.).
- Such firms must follow the Health Care Service Firm rules adopted by the Division of Consumer Affairs (DCA) in the Department of Law and Public Safety (DLPS).
Definitions (for scope)
- Companion services: Non-medical, basic supervision/socialization in the individual's home (may include light household chores); no ADL assistance.
- Health care services: Services for maintenance/restoration of physical/mental health requiring a license or certification.
- Personal care services: ADL assistance (bathing, toileting, transferring, dressing, grooming, ambulation, etc.) by licensed/certified personnel.
2) Accreditation Requirement
- Registered health care service firms must obtain within 12 months of registration accreditation from an accrediting body recognized by the Commissioner of Human Services for homemaker agencies participating in Medicaid (per N.J.A.C.10:60-1.2).
- Accreditation standards to be those in N.J.A.C.13:37-14.1 et seq. and N.J.A.C.13:45B-13.1 et seq., as applicable.
3) Financial Reporting and Audit Requirements
- Annual Financial Statements: All health care service firms must annually submit financial statements aligned with the firm’s state tax filing, with an exemption if the firm did not receive any Medicaid Personal Care Assistance funds.
- Audits Triggered by Funding/Income Thresholds (updated thresholds):
- Audit required if the firm receives more than $5,000,000 for NJ Medicaid Personal Care Assistance (instead of $250,000 previously). Due: third calendar year after registration or by Dec 30, 2022 (whichever is later), and every third year thereafter; due by Sept 30 of the due year.
- Audit required if gross income is $10,000,000 or more in a year (note: prior wording referenced a different threshold; under this bill, the trigger is “generates $10 million or more”); due by Sept 30 of the year it is due.
- For firms that receive less than $5,000,000 in Medicaid Personal Care Assistance but have gross income between $1,000,000 and $10,000,000, the firm must submit a detailed report for the year (beginning with a transition not requiring prior to Dec 30, 2022). The report must include:
- Insurance coverages
- Ongoing or past litigation and regulatory actions by DLPS/DC A against the firm (and dispositions for the previous three years)
- Independent contractors used
- Transactions/liabilities exceeding 50% of total billings or liabilities, as applicable
- The report must be prepared by an independent third-party practitioner following director standards (per P.L.2014, c.29).
- If the Division finds adverse financial viability, it may seek additional information, impose corrective action, and require a separate, post-adverse-action review by a different independent third-party practitioner. The firm must then submit an audit for the next calendar year, regardless of gross income.
- Audits must be conducted by a New Jersey-licensed CPA, include compliance and financial components, and provide an unqualified opinion plus any management letters.
4) Penalties for Non-Registration
- A person who operates a health care service firm without registering is subject to a penalty of $500 per day for each day of operation, collected by the Director of the DCA via a summary proceeding under the Penalty Enforcement Law of 1999.
5) Regulatory Action and Rulemaking
- The Division of Consumer Affairs will adopt rules and regulations necessary to effectuate the act under the Administrative Procedure Act.
6) Effective Date
- The act takes effect immediately upon enactment.
Administrative and Timeline Details
- Accreditation: Within 12 months of registration.
- Audits/Reports: Specific due dates as described above, with September 30th deadlines generally applying for annual or multi-year audit/report submissions.
- Rulemaking: To be conducted by DCA to implement specifics.
Impact and Implications
Overall, the bill tightens regulatory oversight of home-based health and personal care service firms, raises audit thresholds, expands reporting requirements, and strengthens enforcement and accountability mechanisms.
Compiled from official sources — confirm details with the bill’s official record.
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