Provider News

House and Senate Propose Changes to AFC Licensing Law

Both the House of Representatives and Senate are working on changes to the Adult Foster Care (AFC) Facility Licensing Act under House Bills 5505 and 5506 and Senate Bill 745. A summary of these legislative changes is provided in this article.

It is early in the legislative process on making changes to the AFC Facility Licensing Act. Committee hearings have not yet been scheduled in the House or Senate for testimony on the proposed changes. In addition, numerous modifications to the bills are expected prior to final approval by the Michigan Legislature. MALA will be providing updates on the bills throughout the legislative process.

  • House Bill 5505 - Introduced by Representatives Liberati and Rendon on January 31, 2018
  • The definition of adult foster care family and group homes would be for settings with an approved capacity of at least 3. Therefore, a home for 1 or 2 persons would not be required to have an AFC license.
  • The proposed license fee increases are as follows:
    Family home (3-6) - increase from $65.00 to $100.00
    Small group home (3-6) - increase from $105.00 to $150.00
    Small group home (7-12) - increase from $135.00 to $200.00
    Large group home - increase from $170.00 to $500.00
    Congregate facility (renewal only) - increase from $220.00 to $500.00
  • A facility would be eligible for exemption from AFC licensure if all of the following requirements are met:

    (A) All residents are consumers who receive benefits from a community mental health services program and the local community mental health services program monitors the services being delivered in the residential setting.

    (B) The facility has a capacity of 4 or fewer adults.

    (C) The facility agrees to comply with R.400.14505 of the Michigan Administrative Code, regarding smoke detection.
  • House Bill 5506 - Introduced by Representatives Rendon and Liberati on January 31, 2018
  • The cost of the FBI criminal history checks would no longer be covered by the state of Michigan. This cost would be the responsibility of the AFC licensee.
  • In the event that the Department of Licensing and Regulatory Affairs decides to deny, suspend, revoke, or refuse to renew a license, or modify a regular license to a provisional license, the applicant or licensee has the right to a contested case hearing under the Michigan Administrative Procedures Act. This administrative appeal process would reduce the scope of the current facts and law review standard at the Circuit Court Level.

    MALA has numerous concerns with House Bills 5505 and 5506 including the proposed transfer of the cost for FBI criminal history checks from the state of Michigan to AFC licensees and the proposed license fee increases. We are participating in a workgroup of various stakeholders on these bills which has been created by Representative Rendon. We will be providing you with timely updates on the status of House Bills 5505 and 5506.
  • Senate Bill 745 - Introduced by Senator Marleau on January 10, 2018 - the bill's cosponsors are Senators MacGregor, Jones, Knollenberg, Nofs, Stamas, Kowall, Gregory and Schmidt.
  • This bill would amend the AFC Facility Licensing Act to clarify that an AFC license is not required if housing and services are provided by unrelated entities for 6 or less persons who receive community living supports or personal care, or both, as defined by the Michigan Medicaid Provider Manual. This bill is intended for an AFC license not to be required for self-directed living arrangements for individuals with disabilities. Under such living arrangements, the residential setting is typically leased by these individuals from a property owner who has no legal affiliation with the provider of supports and services. This proposed statutory language is based upon recommendations from MALA other than we recommended 4 rather than 6 for the number of persons.
  • Senate Bill 744 - Introduced by Senator Marleau on January 10, 2018 - the bill's cosponsors are the same as Senate Bill 745.
  • This bill would amend the Michigan Zoning Enabling Act to provide that the settings not subject to AFC licensure under Senate Bill 745 would be considered a residential use of property for the purposes of zoning and a permitted use in all residential zones.

MALA Expands Insurance Options and Resources

As previously announced, Michigan Assisted Living Insurance Services is now affiliated with Marsh & McLennan Agency (MMA) LLC and Marsh, Inc., the world's largest insurance organization. The various programs include coverage for professional liability, employment practices liability, property, auto and worker's compensation insurance.

With MMA's relationships and resources, MALA members now have access to an increased number of insurance companies with expertise in insuring assisted living, residential services and other human services. In addition, we understand that protecting an organization's assets is about more than buying insurance. We focus on risk management and loss control techniques to prevent losses.

MALA and MMA will review at no cost your existing insurance policies to assess whether your organization is properly protected at a competitive cost. Please contact MALA if you are interested in a review of your existing insurance program.

MALA is pleased to also be endorsing Lau & Lau Associates, LLC as an exciting new resource for health insurance and employee benefits. With more than 70 years of experience, Lau & Lau has extensive experience in financial and employee benefit planning services.

Lau & Lau's key competencies include health and welfare benefits, cost containment strategies, regulatory compliance, executive benefit strategies and business planning. If you are interested in learning more about Lau & Lau Associates, please call MALA at 1-800-482-0118.

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