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    AN ACT concerning nursing facilities.

 
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    Be it enacted by the People of the State of Illinois,
 
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represented in the General Assembly:


 
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    Section 1. Short title. This Act may be cited as the 
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Nursing Facility Bed Conversion and Modernization Act.
 
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    Section 5. Nursing Facility Conversion and Modernization 
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Program. 
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    (a) For the purposes of this Section:
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    "Nursing facility" means (1) a skilled nursing or 
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intermediate long term care facility, whether public or private 
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and whether organized for profit or not-for-profit, that is 
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subject to licensure by the Department of Public Health under 
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the Nursing Home Care Act, including a county nursing home 
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directed and maintained under Section 5-1005 of the Counties 
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Code, and that is certified under Title XIX of the Social 
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Security Act and (2) a part of a hospital in which skilled or 
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intermediate long term care services within the meaning of 
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Title XVIII or XIX of the Social Security Act are provided.
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    "Conversion and modernization" means the construction, 
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alteration, reconstruction, renovation, modernization, or 
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improvement of existing nursing facility beds or areas within 
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an existing nursing facility.
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    (b)  Any nursing facility that has, for the previous 3 
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years, provided services to at least 35% of its resident 
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population under the medical assistance program under Title XIX 
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of the Social Security Act is eligible to apply for a Nursing 
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Facility Conversion and Modernization Grant.
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    (c)  Nursing Facility Conversion and Modernization Grants 
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shall be available for the conversion and modernization of 
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existing nursing facility beds or areas within a nursing 
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facility for any or a combination of any of the following uses:
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        (1)  Conversion of a portion of or all nursing facility 
 


 






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beds to an assisted living establishment or a special 
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program or unit for persons with Alzheimer's disease or 
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related disorders licensed under the Assisted Living and 
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Shared Housing Act or to a supported living facility as 
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provided pursuant to Section 5-5.01a of the Public Aid 
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Code.
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        (2)  Conversion of shared nursing facility bedrooms to 
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private, single-bed rooms.
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        (3)  Provision of any alternatives to nursing facility 
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care, which, for purposes of this Section, means those 
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services included in the program of home and 
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community-based waiver services for seniors under the 
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medical assistance program under Title XIX of the Security 
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Act, including, but not limited to, adult day services or 
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respite care living space within a nursing facility.
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    (d) A conversion and modernization shall not have the 
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effect of:
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        (1) diminishing or reducing the quality of services 
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available to nursing facility residents; or
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        (2) forcing any nursing facility resident to 
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involuntarily accept home or community-based services in 
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lieu of nursing facility services; or
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        (3) diminishing or reducing the supply of long-term 
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care services in any community below the level of need.
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    (e)  Grants may not be used to expand a current building, 
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except (i) for additional space required to accommodate related 
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supportive services, such as dining rooms, kitchen and 
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recreation areas, or other community use areas; or
(ii)  if the 
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facility demonstrates that new construction is more cost 
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effective than the conversion of existing space.
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    (f)  Notwithstanding any local ordinance related to 
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development, planning, or zoning to the contrary, the 
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conversion and modernization that closes or that curtails, 
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reduces, or changes operations shall be considered a conforming 
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use permitted under local law, provided that the facility is 
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converted to another long-term care service.
 


 






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    (g)  Conversions and modernization pursuant to this Act are 
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exempt from the requirements of the Health Facilities Planning 
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Act.
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    (h)  Subject to available appropriations, Nursing Facility 
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Conversion and Modernization Grants shall be available from the 
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Nursing Facility Conversion and Modernization Fund, a special 
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fund hereby created in the State treasury, for capital or 
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one-time capital expenditures, for a maximum of $1,000,000 per 
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nursing facility; provided that grantees shall be required to 
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provide 20%, and may offer to provide more than 20%, as match 
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toward the total cost of the capital project.  Any application 
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for a Nursing Facility Conversion and Modernization Grant shall 
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include the total budget that will be necessary, including 
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State and federal funding, for services to operate the program 
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once the capital project is completed, and shall specify the 
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number of existing nursing facility beds that the nursing 
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facility provider agrees to de-license.  In distribution of the 
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grants, the following factors shall be considered:
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        (1) the unique needs of residents and their caregivers 
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in the area in which the facility is located;
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        (2) the nursing facility bed need in the area in which 
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the facility is located;
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        (3) the extent to which the conversion and 
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modernization results in the reduction of certified  
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nursing facility beds in an area with excess beds; 
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        (4) compliance history with licensure and 
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certification requirements; and

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        (5) the extent to which the application reflects 
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collaboration and support for the conversion or 
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modernization by other providers and local government 
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leaders in the community.
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The application and grant process, including rules and 
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regulations for the Nursing Facility Conversion and 
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Modernization Program, shall be promulgated by the Director of 
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Public Health, in coordination with the Director of Public Aid, 
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the Director of Aging, and the Secretary of Human Services.
 


 






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    (i)  Any nursing facility receiving a grant pursuant to the 
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Nursing Facility Conversion and Modernization Program shall 
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reduce the number of certified nursing facility beds by an 
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amount equal to or greater than the number of beds being 
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constructed or modernized for one or more of the permitted uses 
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pursuant to subsection (c).
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    (j)  Any nursing facility receiving a grant pursuant to the 
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Nursing Facility Conversion and Modernization Program shall 
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agree, for a minimum of 10 years after the date that the grant 
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is awarded, to maintain a minimum of 35% of its occupancy for 
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residents eligible for services under the medical assistance 
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program under Title XIX of the Social Security Act.  In the 
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event the nursing facility provider or its successor in 
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interest ceases to comply with the requirement set forth in 
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this subsection, the provider shall refund to the Nursing 
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Facility Conversion and Modernization Fund, on an amortized 
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basis, the amount of the grant.
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    (k) Any nursing facility receiving a grant pursuant to the 
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Nursing Facility Conversion and Modernization Program shall 
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not segregate residents receiving nursing facility services 
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under the medical assistance program under Title XIX of the 
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Social Security Act in an area, section, or portion of the 
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nursing facility and shall not move or transfer a resident 
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within the nursing facility solely due to a change in payment 
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status from private payment to government subsidy.

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    (l) Nothing in this Section shall prohibit a nursing 
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facility from moving or transferring a resident as authorized 
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by the Nursing Home Care Act. 
 
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    Section 10. Reporting. The Director of Public Health, in 
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coordination with the Director of Public Aid, the Director of 
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Aging, and the Secretary of Human Services, shall implement 
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mechanisms to monitor and analyze the effect of the Nursing 
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Facility Conversion and Modernization Program, including 
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documenting and verifying the savings to the Medicaid program 
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attributable to this Act.   A report containing the analysis 
 


 






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shall be submitted to the Governor and the General Assembly on 
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January 1, 2006 and on January 1 of each year thereafter.
 
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    Section 90. The Illinois Health Facilities Planning Act is 
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amended  by adding Section 12.05 as follows:
 
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    (20 ILCS 3960/12.05 new)

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    Sec. 12.05. Nursing Facility Conversion and Modernization 
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Act. The criteria and standards for health care planning, 
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including but not limited to the statewide inventory 
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established under Section 12 of this Act, shall not be adjusted 
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by any change in the number of nursing facility beds resulting 
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from nursing home conversion or modernization pursuant to the 
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Nursing Facility Conversion and Modernization Act.
 
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    Section 95. The State Finance Act is amended by adding 
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Section
5.625 as follows:


 
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    (30 ILCS 105/5.625 new)


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    Sec. 5.625. The Nursing Facility Conversion and 
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Modernization Fund.

 

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    Section 99. Effective date. This Act takes effect upon 
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becoming law.