PREFILED JAN 09 2026
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REFERENCE TITLE: health facilities; licensure; complaints; investigations |
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State of Arizona House of Representatives Fifty-seventh Legislature Second Regular Session 2026
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HB 2176 |
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Introduced by Representative Willoughby
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AN ACT
Amending section 36-420.05, Arizona Revised Statutes; Amending Title 36, chapter 4, article 2, Arizona Revised Statutes, by adding sections 36-424.04 and 36-424.05; relating to health care institutions.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 36-420.05, Arizona Revised Statutes, is amended to read:
36-420.05. Legal action or sale; change of ownership; effect on licensure
A. The director may continue to pursue any court, administrative or enforcement action against a licensee even if the health care institution is in the process of being sold or transferred or has closed.
B. The department may deny an application for a health care institution license if either:
1. The applicant, the licensee or a controlling person has a health care institution license that is in an enforcement action or court action related to the health and safety of the residents or patients.
2. The department has determined for reasons other than those specified in paragraph 1 of this subsection that the issuance of a new license is likely to jeopardize resident or patient safety because the applicant or anyone in a business relationship with the applicant, including stockholders and controlling persons, either:
1. Has had a license to operate a health care institution denied, revoked or suspended or a license or certificate issued by a health profession regulatory board pursuant to title 32 or issued by a state agency pursuant to chapter 6, article 7 or chapter 17 of this title denied, revoked or suspended.
2. Has a licensing history of recent serious violations occurring in this state or in another state that posed a direct risk to the life, health or safety of patients or residents.
C. The department may deny the approval of a change in ownership of a currently licensed health care institution if the department determines that the transfer of ownership, whether involving a new direct owner or new indirect owner, may jeopardize patient safety because the new direct owner or new indirect owner or anyone in a business relationship with the new direct owner or new indirect owner, including stockholders and controlling persons, either:
1. Has had a license to operate a health care institution denied, revoked or suspended or a license or certificate issued by a health profession regulatory board pursuant to title 32 or issued by a state agency pursuant to chapter 6, article 7 or chapter 17 of this title denied, revoked or suspended.
2. Has a licensing history of recent serious violations occurring in this state or in another state that posed a direct risk to the life, health or safety of patients or residents.
Sec. 2. Title 36, chapter 4, article 2, Arizona Revised Statutes, is amended by adding sections 36-424.04 and 36-424.05, to read:
36-424.04. Complaint investigations; basis of complaints; time limit
A. When entering a health care institution for a complaint investigation that is filed with the department, the department shall notify the licensee of the general nature of the complaint or complaints WHILE ensuring that the department does not release any protected health information or information that may identify the complainant.
B. IN CONDUCTING A compliance inspection OR INITIAL COMPLAINT INVESTIGATION, THE DEPARTMENT MAY NOT CONSIDER OR INVESTIGATE ANY ALLEGED VIOLATION THAT OCCURRED MORE THAN twelve months BEFORE THE DATE THAT THE complaint was submitted to the department.
36-424.05. Statement of deficiencies; informal dispute resolution; written decision; amended statement
A. The department shall include in any statement of deficiencies that is issued after a COMPLIANCE inspection OR COMPLAINT INVESTIGATION THE CITATION of THE STATUTE OR RULE THAT APPLIES TO EACH IDENTIFIED DEFICIENCY.
B. If a licensee receives a statement of deficiencies following a COMPLIANCE inspection or complaint investigation and the licensee wishes to dispute any identified deficiency, the licensee, during the informal dispute resolution process, shall indicate to the department within ten business days after receiving the statement of deficiencies each deficiency the licensee is disputing and provide:
1. An explanation demonstrating, or documentation showing, that the licensee was in compliance with the identified deficiency at the time of the compliance inspection or complaint investigation.
2. A request for the information to be corrected or rescinded and supporting documentation that explains the reason the deficiency should be corrected or rescinded.
C. The department shall review any information and documentation provided by the licensee pursuant to subsection B of this section within ten business days after receiving the information and render a written decision. The written decision shall state whether the licensee's request to amend the statement of deficiencies is accepted and shall contain a detailed explanation of the disposition of each deficiency contained in the dispute.
D. If any change is made to the statement of deficiencies during the informal dispute resolution process, the department shall issue an amended statement of deficiencies, which may include a deficiency-free statement.