Changes Coming for Minnesota Assisted Living

Sweeping new regulatory standards governing assisted living facilities operating in Minnesota are set to go into effect on August 1, 2021.  The Assisted Living Licensure law under Minnesota Statutes, chapter 144G, is the result of reform legislation passed by the Minnesota Legislature and signed into law by Governor Tim Walz in 2019 to improve the safety and quality of care in assisted living facilities.

Before the legislation, Minnesota facilities commonly referred to as assisted living operated with separate licenses for housing and services.  Under the new law, each assisted living facility is required, by August 1, 2021, to apply for and obtain an assisted living facility license from the Minnesota Department of Health that combines housing with services and home care regulations.  New applicants must first apply for a provisional license that lasts one year.  During that time, the Department will complete a survey of the facility and the facility’s managerial officials.  Direct owners will also be required to undergo a background study.  There are additional licensing requirements for facilities with dementia care.  Once granted, licenses must be renewed annually.  There is a licensing fee for the initial application and renewal of $2,000 plus $75.00 per resident ($3,000 plus $100 per resident for facilities with dementia care), subject to potential adjustments.

The new law includes minimum requirements for assisted living facilities that cover all elements of operation, including resident rights, staffing, training, meals, medication management, infection control, resident programs and councils, visitors, resident records, and resident grievances.  Assisted living facilities must at least have a temporary service plan for each resident in place prior to a resident moving in, must assess and implement a service plan within fourteen days of beginning to provide services to a resident, and must regularly reassess and revise the service plan thereafter.  Beginning on August 1, 2021, all residents must receive a copy of the assisted living bill of rights.  The text of the new law, which includes a number of additional regulations, is available at https://www.revisor.mn.gov/statutes/cite/144G.

Regarding changes of ownership, the new legislation specifies that assisted living facility licenses are not transferable.  Though the legislation is relatively light on change of ownership-specific requirements, it is clear that prospective licensees will need to notify the Department at least 60 days in advance of a change in ownership and apply for a new license prior to operating the currently licensed assisted living facility.  Additionally, for new licensees after a change of ownership, the Department will complete a survey within six months after the new license is issued.

—

The Arnall Golden Gregory Change of Ownership (CHOW) team leads all regulatory aspects of healthcare transactions for investors, operators, managers, capital partners, and developers of every size in all 50 states.  The team streamlines the regulatory process so that clients close their transactions on or ahead of schedule. Whether obtaining licensure and Medicare/Medicaid approvals, structuring transactions to expedite closing, anticipating issues to minimize cash flow disruption, negotiating regulatory terms in deal documents, creatively resolving diligence issues, or advising on CHOW guidelines and compliance, the team provides extensive experience and practical solutions. To date, the CHOW team has served as primary regulatory counsel in transactions valued at more than $25 billion.​