093_HB0050 LRB093 02215 MKM 02223 b 1 AN ACT concerning long term health care. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 1. Short title. This Act may be cited as the 5 Elder Care Savings Fund Act. 6 Section 5. Declaration of purpose. It is declared (i) 7 that for the benefit of the people of the State of Illinois, 8 the conduct and increase of their commerce, the protection 9 and enhancement of their welfare, the development of 10 continued prosperity, and the improvement of their health and 11 living conditions, it is essential that this and future 12 generations be given the fullest opportunity to provide for 13 their long-term health care needs and (ii) that to achieve 14 these ends it is of the utmost importance that Illinois 15 residents be provided with investment alternatives to enhance 16 their financial access to long-term health care. It is the 17 intent of this Act to create a savings fund that will provide 18 residents of the State of Illinois with an investment option 19 that will earn the highest available rate of return while 20 managing risk and maintaining liquidity. 21 Section 10. Definitions. In this Act: 22 (a) "Assisted living establishment" or "establishment" 23 means a home, building, residence, or any other place where 24 sleeping accommodations are provided for at least 3 unrelated 25 adults, at least 80% of whom are 55 years of age or older, 26 and where the following are provided consistent with the 27 purposes of this Act: 28 (1) Services consistent with a social model that is 29 based on the premise that the resident's unit in assisted 30 living and shared housing is his or her own home. -2- LRB093 02215 MKM 02223 b 1 (2) Community-based residential care for persons 2 who need assistance with activities of daily living, 3 including personal, supportive, and intermittent 4 health-related services available 24 hours per day, if 5 needed, to meet the scheduled and unscheduled needs of a 6 resident. 7 (3) Counseling for health, social services, and 8 nutrition by licensed personnel or case coordination 9 units under the Department on Aging and the area agencies 10 on aging. 11 (4) Mandatory services, whether provided directly 12 by the establishment or by another entity arranged for by 13 the establishment, with the consent of the resident or 14 resident's representative. 15 (5) A physical environment that is a homelike 16 setting that includes the following elements, as well as 17 other elements established by the Department in 18 conjunction with the Assisted Living and Shared Housing 19 Advisory Board: individual living units, each of which 20 must accommodate small kitchen appliances and contain 21 private bathing, washing, and toilet facilities, or 22 private washing and toilet facilities with a common 23 bathing room readily accessible to each resident. Units 24 must be maintained for single occupancy except in cases 25 in which 2 residents choose to share a unit. Sufficient 26 common space must exist to permit individual and group 27 activities. 28 "Assisted living establishment" or "establishment" does 29 not mean any of the following: 30 (1) A home, institution, or similar place operated 31 by the federal government or the State of Illinois. 32 (2) A long-term care facility licensed under the 33 Nursing Home Care Act. A long-term care facility may 34 convert distinct parts of the facility to assisted -3- LRB093 02215 MKM 02223 b 1 living, however. If the long-term care facility elects 2 to do so, the facility shall retain the Certificate of 3 Need for its nursing beds that were converted. 4 (3) A hospital, sanitarium, or other institution, 5 the principal activity or business of which is the 6 diagnosis, care, and treatment of human illness and that 7 is required to be licensed under the Hospital Licensing 8 Act. 9 (4) A facility for child care as defined in the 10 Child Care Act of 1969. 11 (5) A community living facility as defined in the 12 Community Living Facilities Licensing Act. 13 (6) A nursing home or sanitarium operated solely by 14 and for persons who rely exclusively upon treatment by 15 spiritual means through prayer in accordance with the 16 creed or tenets of a well-recognized church or religious 17 denomination. 18 (7) A facility licensed by the Department of Human 19 Services as a community-integrated living arrangement as 20 defined in the Community-Integrated Living Arrangements 21 Licensure and Certification Act. 22 (8) A supportive residence licensed under the 23 Supportive Residences Licensing Act. 24 (9) A life care facility as defined in the Life 25 Care Facilities Act; a life care facility may apply under 26 this Act to convert sections of the community to assisted 27 living. 28 (10) A free-standing hospice facility. 29 (11) A shared housing establishment. 30 (12) A supportive living facility as described in 31 Section 5-5.0la of the Illinois Public Aid Code. 32 (b) "Authority" means the Elder Care Trust Authority. 33 (c) "Elder Care Savings Fund" means the fund that is 34 created and administered by the State Treasurer to supplement -4- LRB093 02215 MKM 02223 b 1 and enhance the investment opportunities otherwise available 2 to Illinois residents seeking to save money to pay the costs 3 of long-term health care. 4 Section 15. Elder Care Savings Fund. 5 (a) In order to provide investors with investment 6 alternatives to enhance their financial access to long-term 7 health care, and in furtherance of the public policy of this 8 Act, the State Treasurer may establish and administer an 9 Elder Care Savings Fund. 10 (b) The Treasurer, in administering the Elder Care 11 Savings Fund, may receive moneys from Illinois residents into 12 the fund and invest moneys within the fund on their behalf. 13 The Treasurer may invest the moneys constituting the Elder 14 Care Savings Fund in the same manner and in the same types of 15 investments and subject to the same limitations provided for 16 the investment of moneys in the State treasury. 17 The Treasurer shall develop, publish, and implement an 18 investment policy covering the management of moneys in the 19 Elder Care Savings Fund. The policy shall be published at 20 least once each year in at least one newspaper of general 21 circulation in both Springfield and Chicago, and each year as 22 part of the audit of the Elder Care Savings Fund by the 23 Auditor General, which shall be distributed to all 24 participants in the fund. The Treasurer shall notify all 25 participants in writing, and the Treasurer shall publish in a 26 newspaper of general circulation in both Chicago and 27 Springfield any changes to the previously published 28 investment policy at least 30 calendar days before 29 implementing the policy. Any investment policy adopted by 30 the Treasurer shall be reviewed, and updated if necessary, 31 within 90 days following the installation of a new Treasurer. 32 (c) A portion of the administrative expenses of the 33 Elder Care Savings Fund shall be paid from the earnings of -5- LRB093 02215 MKM 02223 b 1 the fund. No more than 0.005% of the assets of the fund may 2 be used to pay administrative expenses. The Treasurer must 3 seek an appropriation for any administrative expenses that 4 are not paid from the earnings of the fund. As soon as the 5 Elder Care Savings Fund reaches an asset level that equals or 6 exceeds $200,000,000, the administration expenses of the fund 7 shall be paid solely from its earnings. Interest earnings in 8 excess of administrative expenses shall be credited or paid 9 monthly to the several participants in the fund in a manner 10 that equitably reflects the differing amounts of their 11 respective investments in the fund and the differing periods 12 of time for which the amounts were in the custody of the 13 fund. 14 (d) The Treasurer shall adopt rules as he or she deems 15 necessary for the efficient administration of the Elder Care 16 Savings Fund, including specification of minimum and maximum 17 amounts that may be deposited, minimum and maximum periods of 18 time for which deposits may be retained in the fund, and 19 conditions under which penalties will be assessed for refunds 20 of earnings that are not used for long-term health care 21 expenses defined in Section 10 of this Act. 22 (e) Upon creating an Elder Care Savings Fund the State 23 Treasurer shall give bond with 2 or more sufficient sureties, 24 payable to and for the benefit of the participants in the 25 Elder Care Savings Fund, in the penal sum of $500,000, 26 conditioned upon the faithful discharge of his or her duties 27 in relation to the fund. 28 Section 20. Exemption from taxation. As provided in 29 this Act, the investment in the Elder Care Savings Fund is in 30 all respects for the benefit of the People of the State of 31 Illinois, the conduct and increase of their commerce, the 32 protection and enhancement of their welfare, the development 33 of continued prosperity, and the improvement of their health -6- LRB093 02215 MKM 02223 b 1 and living conditions and is for public purposes. In 2 consideration of those facts, income derived from investments 3 in the Elder Care Savings Fund and financial incentives 4 received under the grant program described in Section 25 of 5 this Act shall be free from all taxation by the State or its 6 political subdivisions, except for estate, transfer, and 7 inheritance taxes. 8 Section 25. Grant program. 9 (a) The Governor and the Director of the Bureau of the 10 Budget shall provide for a grant program of additional 11 financial incentives to be provided to participants in the 12 Elder Care Savings Program to encourage the use of the Elder 13 Care Savings Fund and the income derived from the fund for 14 one or more of the following purposes: 15 (1) Care in a facility licensed under the Nursing 16 Home Care Act. 17 (2) Home health nursing services or home health 18 aide services provided by a home health agency licensed 19 under the Home Health Agency Licensing Act. 20 (3) Respite care as defined in the Respite Program 21 Act. 22 (4) Custodial care services. 23 (5) Care in a hospice licensed under the Hospice 24 Program Licensing Act. 25 (6) Long-term health care services for the aged, 26 the disabled, or persons diagnosed as infected with HIV 27 or having AIDS or a related condition. These services 28 include, without limitation, chore-housekeeping services, 29 a personal care attendant, adult day care, assistive 30 equipment, home renovation, home-delivered meals, and 31 emergency response systems. As used in this paragraph, 32 "AIDS" means acquired immunodeficiency syndrome; "HIV" 33 means the Human Immunodeficiency Virus or any other -7- LRB093 02215 MKM 02223 b 1 identified causative agent of AIDS. 2 (7) Care in an assisted living establishment. 3 (b) The grant program of financial incentives shall be 4 administered by the State Treasurer pursuant to 5 administrative rules adopted by the Treasurer. The financial 6 incentives shall be in forms determined by the Governor and 7 the Director of the Bureau of the Budget and may include, 8 among others, supplemental payments to the participants in 9 the Elder Care Savings Fund to be applied to costs of care or 10 services specified in items (1) through (6) of subsection 11 (a). The Treasurer may establish, by rule, administrative 12 procedures and eligibility criteria for the grant program; 13 those rules must be consistent with the purposes of this Act. 14 The Treasurer may require participants in the Elder Care 15 Savings Fund, providers of long-term health care services, 16 and other necessary parties to assist in determining 17 eligibility for financial incentives under the grant program. 18 (c) All grants shall be subject to annual appropriation 19 of moneys for that purpose by the General Assembly. 20 Financial incentives shall be provided only if, in the sole 21 judgment of the Director of the Bureau of the Budget, the 22 total incentives offered in a given year will not exceed the 23 balance of the Elder Care Savings Fund on the day the 24 incentives are offered by more than 0.5%. 25 Section 30. Education program. The State Treasurer, in 26 cooperation with the Department on Aging and area agencies on 27 aging, shall develop and implement an education program and 28 marketing strategies designed to inform residents of this 29 State about the options available for financing long-term 30 health care and the need to accumulate the financial 31 resources necessary to pay for that care. The Treasurer 32 shall report to the General Assembly on the program developed 33 and its operation before May 1, 2004. The Treasurer shall -8- LRB093 02215 MKM 02223 b 1 adopt rules with respect to his or her powers and duties 2 under this Act. 3 Section 35. Elder Care Trust Authority. 4 (a) The Elder Care Trust Authority is created. The 5 Authority shall consist of 11 members, 7 of whom shall be 6 appointed as follows: the Speaker and Minority Leader of the 7 House of Representatives and the President and Minority 8 Leader of the Senate shall each appoint one member, and the 9 Governor shall appoint 3 members. The State Treasurer, the 10 Director of the Bureau of the Budget, the Director of Public 11 Health, and the Director of the Illinois Economic and Fiscal 12 Commission, or their respective designees, shall each be a 13 member ex officio. The Governor and legislative leaders 14 shall give consideration to selecting members that include 15 representatives from the following categories: (i) a 16 director, officer, or employee of an entity that provides 17 long-term health care services; (ii) a person having a 18 favorable reputation for skill, knowledge, and experience in 19 the field of portfolio management; and (iii) a person 20 experienced in and having a favorable reputation for skill, 21 knowledge, and experience in the long-term health care 22 savings field. 23 The State Treasurer or the Treasurer's designee shall 24 serve as the chairperson of the Authority. 25 The appointed members of the Authority first appointed 26 shall serve for terms expiring on June 30 in 2004, 2005, 27 2006, 2007, 2008, 2009, and 2010, respectively, or until 28 their respective successors have been appointed and have 29 qualified. The initial term of each of those members shall 30 be determined by lot. Upon the expiration of the term of any 31 member, the member's successor shall be appointed for a term 32 of 6 years and until his or her successor has been appointed 33 and has qualified. -9- LRB093 02215 MKM 02223 b 1 Any vacancy shall be filled in the manner of the original 2 appointment for the remainder of the unexpired term. 3 Any member of the Authority may be removed by the 4 appointing authority for misfeasance, malfeasance, or wilful 5 neglect of duty or other cause after notice and a public 6 hearing, unless that notice and hearing are expressly waived 7 by the member in writing. 8 Members are entitled to be compensated from moneys 9 appropriated to the State Treasurer for their reasonable 10 expenses actually incurred in performing their duties. 11 Staff assistance shall be provided to the Authority by 12 the State Treasurer. 13 The Authority shall meet at least once each year. 14 (b) The Authority has the following responsibilities: 15 (1) To make recommendations to the Elder Care 16 Savings Fund staff regarding the marketing of the fund to 17 ensure the use of the fund by participants throughout the 18 State for long-term health care purposes. 19 (2) To advise the Elder Care Savings Fund staff on 20 an effective advertising campaign to inform the general 21 public about the fund and its availability. 22 (3) To advise the Elder Care Savings Fund staff 23 regarding the investment portfolio of the fund. 24 (4) After the creation of the Elder Care Savings 25 Fund, to assess the effectiveness of the program and 26 recommend constructive changes to the Bureau of the 27 Budget. 28 (5) To make recommendations to the General Assembly 29 regarding statutory changes that the Authority deems 30 necessary or desirable. 31 Section 99. Effective date. This Act takes effect upon 32 becoming law.