I don’t quite know why we keep doing this, but from time to time one player in the senior living sector seems to delight in demonizing their competitors.

I don’t quite know why we keep doing this, but from time to time one player in the senior living sector seems to delight in demonizing their competitors. 

Don’t get me wrong, when we see someone doing something unethical or immoral, something that puts elders or staff members in jeopardy, we have a moral obligation to stand against those things. 

That being said we should never turn to the law to protect us from our competitors or to hurt our competitors. 

It is unfair and it is wrong.

The Proposed Bill

A few weeks ago a California State legislator introduced a new bill that, according to the author, was written to protect consumers from “Unscrupulous Elder Care Referral Agencies”; here are the key provisions:

  • Require referral agencies to disclose any financial interest shared with a care facility, including all fees, commissions received, and other financial benefits resulting from the placement.
  • Require disclosure of how often a referral agency has inspected a facility; and, provide information on where complaints can be directed.
  • Require the referral agency to protect the medical privacy of seniors by prohibiting the sharing of any of the client’s personal information.
  • Require the referral agency to maintain liability insurance, and prohibit the referral agency from holding any power of attorney or property of a client.
  • Require a referral agency to visit a client within a reasonable time after placement.
  • Add “residential care facility for the elderly” to the definition of referral agency for licensing purposes.

Here’s What’s Wrong

Disclosure:  Caring.com is a Senior Housing Forum partner, which means there is a financial relationship between the two entities and this bill would do damage to Caring.com.

  • This bill does essentially nothing to protect consumers.  Instead it is designed to give local senior living placement organizations an unfair competitive advantage over online internet referral agencies like Senior Housing Forum partner, Caring.com and A Place for Mom. 

    The most burdensome of the requirements is that referral agencies visit communities prior to making referrals and then again after placement of a resident. Well ok . . . and do what? Is the referral agency supposed to be a second licensing inspection? What happens if a referral agency visits a community (single snapshot, the agency can only see what the operator wants them to see) and then something turns out to be different?  

    And if the post move-in visit does little except invite the referral agency to tell the new resident about an even better opportunity (churning). Again what happens if the agency finds a problem.

  • This bill is also being supported by a coalition of small six-bed board and care communities, which have traditionally been the bread and butter of these local placement agencies. It becomes a direct shot across the bow to every single larger assisted living community that depends on leads from Caring.com, A Place for Mom, and similar services.
  • As the bill is currently written referral agencies would be prohibited from transmitting by paper or email any prospect information. The only method allowed to connect prospects with a community would be for the placement agency to handwalk prospects into a community . . . this would be true in Silicon Valley, the birthplace of technology.
  • The other dark age provision is that every prospect would be required to sign a paper document authorizing a referral agency to help them. Good way to kill more trees, and give local referral agencies a clear advantage. It does not benefit the consumers because it effectively limits consumer’s ability to use internet services.  
  • The bill is mostly solving a problem that doesn’t exist. The articles describing this bill cite three example problems. The two that are specific, describe actions that are already illegal and the law did not prevent. The third is along the lines of “There are rumors of unscrupulous behaviors.”
  • The way the bill is written suggests there is not good disclosure that the senior living communities pay the fees. While there may be some small companies where this is true, it is not the case for either Caring.com or A Place For Mom. They do nothing to hide the fact that the service is free to the consumer and is paid by the senior living community.
  • If seniors are looking for a more intimate referral experience they should, by all means use one of the companies supporting this bill. But if they are looking for great reviews and great listings on the Internet, they should not be handcuffed by legislation.

At the most fundamental level I find myself asking if we really need another law, another agency or another thing an existing agency needs to regulate. The licensing agency in California is struggling today. The idea of chasing a problem that either doesn’t exist or is very tiny is nuts. Their resources need to be focused on inspecting communities and cracking the whip on those communities that are not providing care.

While today this is a California problem if it passes here, other states need to look out. 

If you are interested in watching sausage being made, you can view the video of the first public hearing here: 


Steve Moran