Elder Care Referral Businesses to Face Increased Regulatory Scrutiny

NewImageWashington will be the first state to clamp down on the explosive growth of elder care referral businesses according to a report from the Seattle Times.

The providers help guide families through a range of options for their loved ones that can include assisting living or other senior housing that best fits their needs for free.  In return, these companies can be paid as much as $3,500 per person by the facilities for providing them with a client.

Legislation sent to Governor Chris Gregoire will require referral companies to follow strict standards that include written disclosures of their commission rates.  Washington is the first state to pass a comprehensive law to rein in elder-care referral companies, according to research by AARP, a senior organization that supported the bill.


Across the nation, lawmakers are studying the bill as a model for change in at least a dozen states, consumer advocates and legislators said.

“The inherent problem is that referral agencies aim to make a profit at a most vulnerable time in an elder’s life,” said state Ombudsman Louise Ryan. “Right now, there are no rules.”

The bill requires companies to meet the following minimum standards:

  • Obtaining a signed disclosure statement of fees and commissions.
  • Maintaining at least $1 million in liability insurance coverage.
  • Completing a standardized intake form that tracks a senior’s medical history and ability to pay for board and care.
  • Follow the state Consumer Protection Act, which gives the state Attorney General’s Office authority to investigate complaints.

State gets tough on referrals for elder care