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A new bill would close an unusual loophole in California, requiring all nursing home owners and those planning to buy facilities to get a license before taking control.

The proposal, Assembly Bill 1502, would prohibit entities from acquiring and operating a skilled nursing facility in the state without first obtaining a license from the state’s Department of Public Health.

Operators would also need to show their Medicare and Medicaid cost reports from the last five years for all nursing facilities owned or managed by them under the measure. The licensing applications and related documents would be made public by the department. 

The agency could also deny application if operators don’t meet the necessary requirements. The measure is expected to be passed quickly, this week possibly, by state lawmakers, according to a report by the Times of San Diego.

Lawmakers and industry advocates have also sought more ownership transparency on a national scale. A top expert in September suggested that more transparency regarding nursing home ownership and how profits are spent will be needed if the industry wants to successfully move forward from the COVID-19 pandemic.