I am writing on behalf of the Association of Minority -Owned ALF (AMOA), which represents state-regulated Assisted Living Facilities (ALFs). These facilities provide essential care for the impoverished and disenfranchised, receiving minimal compensation. The Joint Legislative Audit and Review Commission (JLARC) has noted that the Auxiliary Grant is below fair housing market value.

The proposed regulation, 22VAC40-73, requires our small businesses to bear the burden of minimum liability insurance without corresponding financial support. This requirement will severely impact our ability to provide housing for individuals with mental disabilities.

The regulation fails to consider the differences among assisted living facilities. Auxiliary grant beds, which are primarily residential and offer a homelike environment, should not be classified the same as pseudo nursing homes that employ medical professionals and provide extensive medical assistance. If the Department of Social Services had collaborated with insurance companies to develop a practical tier classification system, it could have provided a viable solution. However, as it stands, the current proposal is merely theoretical, lacking a solid foundation. Insurance companies can disregard these tiers, leaving us exposed to unnecessary million-dollar policies. 

Consequently, insurance companies struggle to classify our smaller industry appropriately. A million-dollar policy for a thirty-bed facility earning only $70 per day is unreasonable, especially when compared to facilities earning $1000 per day. This disparity is not only unfair but also economically oppressive, threatening the survival of small black-owned businesses. 

For over twenty years, the AMOA has advocated for our industry, yet we have received no relief from these harsh and burdensome regulations. Implementing this new regulation without providing the means to sustain it sets us up for failure once again. Insurance agencies operate without restraints, able to drop clients without warning, shut down after taking deposits and financing, and deny coverage if it is not profitable for them.

We urge you to reconsider the implementation of this regulation and provide the necessary support to ensure the continued operation of our facilities.

Thank you for your attention to this critical matter.

AGENCY: DEPARTMENT OF SOCIAL SERVICES BOARD: STATE BOARD OF SOCIAL SERVICES CHAPTER: STANDARDS FOR LICENSED ASSISTED LIVING FACILITIES (22VAC-40-73) ACTION: MINIMUM LIABILITY INSURANCE FOR ASSISTED LIVING FACILITIES EMERGENCY REGULATIONS FOR LIABILITY INSURANCE FROM THE INDEPENDENT HOMEOWNERS We represent the small minority residential/assisted living homes that serve the mentally ill and the poor who receive auxiliary grant funding. We are finding it exceedingly difficult to find liability insurance for homes that are licensed for 8 to 25 beds. Your tier system is not recognized by insurance companies as there is no $250,00 insurance policy. Insurance companies are not interested in coverage less than (1) one million dollars. As small business owners this represents a hardship. Unlike private assisted living facilities, we are unable to pass this cost on to our residents. And our current funding source (auxiliary grants) has not increased to bear the additional cost. We are concerned that this additional cost could impact the quality and scope of the services we provide. We are different from nursing homes, rehabilitation facilities or convalescent homes. Assisted living standards state that we are to work within the scope of our license. We are a minimum care facility that went from board and care to assisted living. When this change occurred the insurance companies dropped coverage for small, assisted living homes throughout the State of Virginia. Now small businesses are being priced out of business by the insurance companies. The state is also failing to make the proper adjustments and funding to pay for this. As you research your records over the pass few years you will find that small minority homes have gone out of business based on changes in the assisted living standards and regulations. We are seeking a variance for small minority homes (8-25) beds to carry liability insurance as it presents a burden and hardship to the licensee’s which in turn impacts the individuals we serve. We have too many homeless citizens living on the street. This is unfair to them as they continue to need our assistance. Cc: kristoper.drew@dss.virginia.gov

Hello, I am writing to express my concerns about the proposed regulation, 22VAC40-73, and how it will impact small minority business owners like myself who operate small residential assistant living facilities. The burden that this regulation would place on us could potentially put us out of business, affecting our ability to provide housing for Auxiliary Grant residents.

As a business licensed to provide housing, care, and oversight along with medication management, we operate on a daily budget of approximately $70.00. This is significantly lower than facilities such as Group Homes and Nursing Homes, which earn around $1,000 daily. The regulation requirement to obtain a$250,000 policy is simply not feasible, as such policies are not readily available and we would be forced to purchase a $500,000 policy at a much higher cost.

This additional financial burden would not only be unfair to small business owners like myself, but it would also have a detrimental impact on the residents in our facilities. Many of these individuals rely on us for housing and care, and any disruption in our ability to operate could leave them displaced or even homeless.

I urge you to reconsider the implementation of the regulation and take into consideration the needs of the mental health and intellectually delayed residents who depend of facilities like ours for support and care.

Kind Regards

The requirement for assisted living facilities (ALFs) to maintain a minimum level of liability insurance, as outlined in Chapter 580 of the 2023 Acts of assembly (sb1221), could have significant financial implications for facilities that serve lower-income populations. Here are several ways in which this mandate might adversely affect these facilities:  

1. Higher Insurance premiums
2. Operational Strain
3. Potential for Facility closures

As an owner of a small facility of 6 I have found it extremely challenging to keep up with the ever so fast changing of the requirements that causes a Finacial increase, with the slow increase of the auxiliary grant. I have seen so many go out of business due to these changes. 

I ask that you all look at the need and the quality-of-care individuals receive at smaller homes that are licensed and take that into consideration when you decide on extreme changes that will pose financial strain. No one is asking to not hold insurance were just asking for REASON. When serving an already underserved population.